While the economic recession in the West has affected consumer sentiment worldwide recent research reveal the Indian consumer is still showing interest in global luxury brands. And to woo these consumers, global brands are adopting every single measure from offering early discounts to creating an India specific product range at affordable prices. Mid-segment to high-end luxury brands are busy creating collections to woo Indian consumers and boost sales.
Indian consumer is said to be a tough nut to crack when it comes to preferences where even food habits change every kilometre. Brands cannot have a blanket strategy to bring them to the stores but they are still going ahead by offering products that could appeal to the Indian consumers’ expectations. “With markets like Europe undergoing economic turmoil, developing countries like India are forging ahead as attractive markets for international brands,” says a recent study conducted by AT Kearney. According to the report, “India currently ranks 5th among developing markets as a key retail destination.” And brands are pinning their hopes on the supposedly positive India growth story since domestic apparel retailers have not been happy with the response from consumers since last couple of seasons. And even as most foreign brands witnessed a slowdown in summer with consumers tightening their purse strings, they are hopeful of the festive season ahead to achieving growth targets.
Keeping faith in the studies that are harping on how increasing disposable incomes in the country coupled with growth in brand consciousness in the Tier II, III cities will boost luxury shopping, high-end foreign labels are launching collections in India. For instance, Tom Ford recently launched diamond-studded cufflinks priced at Rs 5 lakh. Last year, the brand had launched the bandhgala jacket, exclusively for India, priced at over Rs 2 lakh.
Brands are also trying to offer low-priced range in the country. Like French fashion wear Elle, represented by apparel maker Arvind Brands, recently launched women’s wear at ‘Indian prices’ after its entry in April this year. German apparel brand s.Oliver too is planning to introduce low-priced products in India. Accessories seem to be driving the luxury retail market more than clothing. As Arvind K Singhal, Chairman of Technopak Advisors opines, “In the West, clothing forms a large part of luxury sales but luxury clothing is negligible in India. In India, we don’t have formal gowns and dresses because for Indian weddings, we have Indian style clothes. In this market, a Chanel or a Dior can’t get in. However, accessories market including luxury watches, bags, eyewear, jewelry are growing phenomenally.”
No wonder then global big names like Zara, Canali and Louis Vuitton have already established their footprint in India with local partners. And with the domestic luxury segment showing a potential of 20 per cent growth per annum and the government allowing 100 per cent FDI in single brand retail, other luxury giants such as Christian Louboutin, Abercrombie, Arcadia, Hennes and Mauritz, Prada and GAP are in working out plans to launch their India stores.
There are more global names in the luxury segment eyeing to enter India since the scenario is positive for them compared to developed economies of the world. DLF Emporio, for example is in talks with seven to eight international luxury brands that plan to foray into the country soon.