Lux­ury, Now Af­ford­able!

Ms Mala Al­wani, Founder, BESIVA, ex­plores the grow­ing mar­ket for ‘af­ford­able lux­ury’, as more and more In­dian con­sumers are look­ing at lux­ury brands as their top choice for shop­ping ap­parel.

Apparel - - Contents -

Ex­plor­ing the grow­ing mar­ket for af­ford­able lux­ury

With ris­ing in­comes and greater ex­po­sure to Western cul­tures, the habits, tastes and needs of the new mid­dle-class In­dia is an emerg­ing mar­ket as the con­sumers evolve–shop­pers seek­ing aspi­ra­tional, high qual­ity brands at the best prices. Ev­ery con­sumer is well-versed with the in­ter­na­tional qual­ity and longevity stan­dards, and the so­cial me­dia out­burst gives them up-to-date cov­er­age on what’s the lat­est in the lux­ury seg­ment.

DE­MAND DRIV­ERS

Lux­ury has dif­fer­ent mean­ings for dif­fer­ent peo­ple. To some con­sumers, lux­ury goods pro­vide a means to a bet­ter life­style, while oth­ers adapt lux­ury goods to their ex­ist­ing life­style. This per­cep­tion varies with the ma­tu­rity of the mar­ket and the ex­po­sure to which the con­sumers have been sub­jected. The grow­ing in­flux of in­ter­na­tional lux­ury brands will be a gamechanger, the likes of which the re­tail sec­tor has not seen in a very long time.

In­dia’s lux­ury mar­ket is set to grow to US$30 bil­lion from US$23.8 bil­lion by the year-end, on the back of grow­ing ex­po­sure of in­ter­na­tional brands amongst the In­dian youth and higher pur­chas­ing power of the up­per class in tier II and III cities.

Growth in the num­ber of mid­dle class con­sumers–fu­elled by fac­tors such as eco­nomic progress, higher pro­duc­tiv­ity, ed­u­ca­tional at­tain­ment, ur­ban­i­sa­tion and more work­ing women–is driv­ing up av­er­age in­come and spend. Low-in­come con­sumers com­ing out of poverty are in­creas­ing ex­pen­di­ture on a range of dis­cre­tionary items such as pre­mium pack­aged foods, din­ing out, health and beauty, elec­tron­ics, fash­ion and other prod­ucts and ser­vices. They are not pre­pared to com­pro­mise on qual­ity: in gen­eral, they would rather save up their money to buy fewer pres­tige brands than pur­chase a large num­ber of in­fe­rior prod­ucts. To make prod­ucts af­ford­able and ap­peal­ing to emerg­ing mar­ket con­sumers, brands like BESIVA are em­ploy­ing tech­niques such as par­ing down lo­cal pro­duc­tion costs, sa­chet mar­ket­ing, re­gional cus­tomi­sa­tion and es­tab­lish­ing a stronger on­line pres­ence with whole­sale as well as re­tail web­sites.

Well-trav­elled con­sumers and a sta­ble econ­omy, cou­pled with a young pop­u­la­tion with grow­ing dis­pos­able in­comes, spell good news for lux­ury brands across the world. With pos­i­tive reg­u­la­tions and poli­cies for the re­tail in­dus­try be­ing put in place by the Gov­ern­ment, In­dia is a mar­ket that can no longer be ig­nored by in­ter­na­tional brands. And it turns out that this is what the mod­ern In­dian cus­tomer is look­ing for, whether they live in Delhi, Mum­bai, Ben­galuru or Chen­nai.

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