The socio-economic-political gloom all over the world paints a not so rosy picture, at the end of a cold and wintry 2019. However, the rich continue to spend, and the personal luxury goods market continues to grow at 4%. This, irrespective of disturbances in Hong Kong, the Brexit reality, & the Modi government facing its worst ever crisis since it return to power for a second term.
In such a depressive scenario laced with geo-political uncertainties & fears of recession, is there hope for India’s Luxury industry? Will the Indian rich continue to spend? How should a luxury brand prepare itself for not only survival but a growth trajectory?
There is no doubt that the Indian luxury opportunity clearly looms large and attractive. However considering the cultural diversity, the geographic divide, the challenging environment and other technicalities, a luxury brand would do well to take note of the key performance drivers and or trends currently prevalent India.
The Inverted pyramid phenomenon is peaking: With the millennials and gen Z seeking authenticity over brand name, the true mix and match culture is at its peak. With luxury brands trading down and high street fashion brands trading up, the trend is the amalgamation of the two. It is quite common to see the stylist effortlessly showcasing an expensive hand bag or shoe with a Marks & Spencer’s or even a Zara dress.
Reusable luxury is not taboo any more: From cars to watches to fashion and accessories, the new luxury consumer is preferring to buy a cheaper higher positioned luxury product over the traded down lower level of a luxury brand. Clearly, democratised luxury lines are facing the heat from their own higher up’s. Names like Big Boyz Toyz have created history by clocking unheard of sales via their online mediums
Beauty and skin care are driving luxury sales: The wellness transformation of the luxury beauty & skincare market has taken a major leap with emergence of South Korea as a leader. Have the Koreans discovered the elixir of youth, or is it all just a marketing puff? The advent of tic toc celebrities from smaller towns drawing instant fame to almost cult positions is driving the small town India towards a look good phenomenon. Whilst the likes of HnM; MnS and Zara bring fast fashion to small towns, it’s the beauty business which is laughing all the way to the bank. After all, you can’t rent a lipstick can you?
The invasion of the pink brigade: With the clearance of the article 377, an open arm acceptance of the LGTBQ community is being celebrated all over. Fashion is more universal & gender neutral, make up is following and so is jewellery.
The lazy generation: Digital assistants by virtue of remote devices are now being discarded and replaced by voice activated assistants. No longer does the generation want to lift even a finger, but uses his voice to command devices. And technology surely is aiding this lazed out approach. From TV’s to air conditioners to cars to mobiles, all seem to respond to his masters’ voice!
Wanderlust drives micro vacations: The desire to see more, explore more, share more and post more is driving youngsters to locate, experience and wander to unchartered locations. Mini vacations replace month long family holidays. Long weekends / short weekend all see hordes of SUV’s driving to remote locations for a micro break.
Time & clean air are the new luxury: With traffic & environment conditions deteriorating, new models of work, living and entertainment are emerging. With a customer’s time being at a premium, anything which can help save time is preferred. A new trend towards home delivery, home shopping, and home entertainment is creating a new economy. The gig economy, the zero distance retail and entertainment hub real estate projects are fast catching trends.
Emergence of the ‘Seenager’ consumer: With more and more brands focussing on the young, a newer breed of products are seen to quietly target the aging baby boomers. Aptly coined as ‘seenagers’, this cohort has the money to spend, is knowledgeable, patient and willing to experiment unlike his forefathers. Special living homes, assisted travels, curated holidays and service at the snap of you finger are being designed and offered to this consumer. And yes, the elders are simply loving it!
Affordable Luxury Is the Segment to Be In: A strong case exists for catering to first-time luxury buyers who have recently seen a rise in their disposable incomes. Thanks to 4G, they now have access to cheap & fast internet via smartphones. With sophisticated tastes and awareness of international trends, this affluent demographic wants better goods & services which the luxury industry is primed to offer. The Uniclo’s, MnS, HnM and Zara are clear winners in this race.
The rise of the ‘fit’ customer: Another megatrend is fueling the demand in active wear and sportswear. Worldwide, there is a cultural shift towards sports including running as part of a growing emphasis on fitness, especially among the urban population. Technology is getting integrated as part of wearable. There are smart clothing items in the market with embedded health sensors and medical monitors. Outside of apparel too, fitness wearable that sync to smart phones have gone mainstream.
Abhay Gupta, Founder & CEO – Luxury Connect | Advisor & Mentor to Luxury Brands | Professor of Luxury Management | Speaker | Author | Mentor | Certified Marshall Goldsmith Coach
The above forecast is partly credited to the yet to be released book ‘The Incredible Indian Luxury Bazaar’, authored by Abhaya Gupta.
Ralph Lauren store in Delhi at The Chanakya Mall (India)