Leather gets aspirational

For a category where consumer demand is high, why are there such few homegrown leather brands in India, while international brands mostly crowd the luxury peak?

Strong annual growth at 25% and seasonal growth as high as 150-200% indicates that leathers in India have strong consumer demand. A browse across retail throws up a flood of jazzy and pastel colours like blue, orange, fuchsia and yellow. You can also buy lightweight, anti-fungal, anti-bacterial, water proof and weather-proof leather products.

A study by Dragonfly Market Research for mid-end leathers brand Lavie indicated that while consumers recalled Coach, Prada, Louis Vuitton, Gucci, Charles & Keith, Hidesign, Nine West, Aldo, Da Milano, Zara, Mango and Guess at the luxury/premium end, their brand recall fell to twothree at the mid and popular ends.

Why is it that for a category that’s recording such rapid growth, leathers haven’t exactly seen major home g rown brands coming up in India? A few ‘made in India’ brands such as Da Milano, Caprese, Holii, fab-India and Hide sign show a national presence. The rest are either regional brands or unknown-brand products that consumers mostly buy relying on the retail outlet’s reputation or high-street address.

While checking out leather bags at a popular outlet in Delhi’s Connaught Place, Mitali Gupta, 35, a software engineer, said: “I am looking for a handcrafted leather bag for र 1,500-2,000.” She does not know much about leather grades.

“The growth of the leather category is phenomenal at 150200% season on season, reflecting strong consumer presence. However, average price points hover between र 1,500-6,000, reflecting price sensitivity,” said Praveen Sinha, founder and MD, Jabong.com. Leather jackets cost र 20,000 plus.

“Branded leather products are expensive, hence a majority of consumers opt for unbranded leather products. Look, feel and variety matter to consumers, as do the better prices in alternative materials such as art and synthetic leather,” said Sandeep Goenka, COO, Bagzone Lifestyles, which sells the Lavie brand leather bags and footwear targeted at Gen Y women. Bagzone also sells Samsonite and American Tourister. Lavie recently ran a TV ad campaign with Kareena Kapoor endorsing it.

“While Indian consumers have started aspiring for leather products, the majority of the market still remains price sensitive and illiterate about good leather grades,” said Ankur Bisen, senior vice president, retail, Technopak. “High grade leather is 10 times more expensive than low grade leather. Then, there are mixes with nylons and synthetics that bring prices down, attracting consumers. This obstructs the growth of leather brands.”

“The cost of raw materials for leather products is much higher than synthetic and faux leather,” said Mehak Khurana, retail merchandising head, Holii. “The consumer likes cheaper copies but does not respect the brand,” grumbled Dilip Kapur, president, Hidesign.

Added Harkirat Singh, MD, Woodland: “India is exporting over 60% of leather. The rest goes to selected manufactures for domestic consumption, insufficient for reasonably priced products.” Woodland mostly imports leather products from Italy to India.

For now, the consumer does not seem too bothered. “I own seven-eight purses, of which only one is of a well known leather brand. The rest I bought from malls and online portals, based on their looks, style, colours and pricing,” said Gupta.