T HE L UXURY T IMES Residents from upmarket south Mumbai households drink milk from happy cows‘. Priced at Rs 75 a litre, the milk is extracted from Jersey-Holstein cows which listen to soothing music and consume specially grown fodder. In 2010, a consortium of industrialists in Aurangabad placed an order for 150 Mercedes cars worth Rs.65 crore. (Customer profile: Entrepreneurs in their 30s and 40s) Hero Cycles has forayed into the premium bicycle market by launching cycles priced at Rs 43,000, under the brand name ‘Urban Trail’.
P ERSPECTIVE Luxury market grew at ~20% in 2010-11 and is valued at ~$5.8 billion, currently. World Wealth Report by Cap Gemini Merrill Lynch estimates the number of Indian high net worth individuals with liquid assets of over $1 million at 1,53,000. A study by Wealth-X, estimates that there are 8,200 ultra-high net worth individuals (UHNW) in India with a combined fortune of $945 billion.
R ECENT T RENDS Jewellery, electronics, cars, fine dining, apparel, accessories, wines and spirit witnessed maximum growth. Luxury has gone beyond Delhi, Mumbai and Bangalore to Chennai, Hyderabad and Pune. North Mumbai and Gurgaon have emerged distinct hubs for luxury goods.
D RIVERS OF GROWTH Aspiring middleclass with rising disposable incomes- the game changer Privatization of airports providing a retail space for brands that fit in modern life, work, career, travel and international lifestyle. Government showing interest in increase in FDI limits to 100% in single brand retail and 51% in multibrand retail
P ROGRESSION OF B RANDSLuxury/Prestige brand• Rolex, Louis Vuitton, CartierPremium brands• Ralph Lauren, Calvin Klein, Tommy HilfigerFashion brands• Numero Uno, Titan, Fast track
ATTRIBUTES OF L UXURY G OODS Creativity Premium Exclusivity pricing. Attributes of Luxury GoodsInnovation Craftsmanship High quality Precision
B OTTLENECKS Infrastructure challenges and regulatory constraints Import taxes on luxury goods, which at the federal level are between 30%-40% 51% cap on the foreign ownership of their Indian units, which luxury brands fear risks diluting their name and harming their business models.
E SSENTIALS FOR LUXURY BRANDS IN I NDIA ‘Expansiveness’ (meeting divergent needs) Must tell a story (identity) Relevant to the consumers’ need Align with consumers’ values as luxury goods are forms of expression or identification for a luxury consumer Must perform
S TRATEGIES FOR M ARKETING OF L UXURY G OODS Customer engagement, personalized experience Maintain exclusiveness Separate line of goods available at lower cost; refurbished cars and line extensions P ™romoting luxuries as a wise investment; Villas ‘Targeted luxury’ memorabilia is given to the target segment in an attempt to fuel their desire for owning the product; Miniature models of Mercedes cars, key chains of Rolex watches
F OCUS AREASPrice-value relationship Reputation of the service provider Product brand
N EW TERRITORIES OF LUXURY BRANDING Services Real estate Hospitality
H IDESIGN : A HOMEGROWN LUXURY BRAND Hippie brand born in the late 1970s. The Puducherry-based company caters to the upmarket luxury end of the business. French multinational Louis Vuitton has bought a stake in the company The company has introduced ‘Holii’ range of accessories, in partnership with Kishore Biyani’s Future Group.