The document discusses luxury branding in India from an FCUK India perspective. It notes that the Indian luxury market is worth $4.9 billion and is the second fastest growing luxury market in the world, dominated by jewelry. While there is huge potential for growth, luxury brands struggle in India due to high import duties and consumers' preference to shop abroad. The document outlines attributes important to Indian luxury consumers and lessons brands can learn to better target the Indian market, such as partnering with local companies, offering lower price points, and customizing products for Indian tastes and trends.
5. THERE SHE GROWS
India is second fastest growing region in Asia Pacific for Luxury Products
The Indian market is expected to grow at rate of 25% over next 5 years.
At $4.8 billion, the luxury retail market has place for everyone.
Apparel, jewelry and personal care are the biggest sells in the luxury market.
7. LETS TALK NUMBERS
Indian Luxury Market is worth USD 4.9 billion
Forms only 2% of the global share – huge scope for expansion.
India will be the second largest economy by 2040.
103,000 millionaires .
16,000 more are getting added every year.
Second fastest growing luxury market in the world.
8. DIFFERENCES IN GLOBAL AND INDIAN
MARKET
Figs in percentage
29
43
7
28 39
14 5
8 20
7
Global India
Wines and Spirits Art Jewellery and watches Personal Care Apparel
Indian market is dominated by Jewellery whereas as Global market is dominated
by Apparel and Accessories. Source: AT Kearney Research Report
10. THE INDIAN SOJOURN
French Connection currently has more than 1,500 outlets across 25 countries worldwide.
fcuk hit the Indian market at the Lakme Fashion Week in April 2007.
Today it has 21 points of sale across eight cities in India.
Main segments are Men’s Apparel, Accessories, Women’s Apparel and watches.
For the Indian markets it has an agreement with BMI India for distribution.
12. PLUMMETING SALES GLOBALLY
AND IN INDIA
Globally, after 10 years of growth has come to a shuddering halt.
An adaptation of the company's infamous slogan may be a more fitting description of its financial
condition.
Making USD 300 per 100 sq. feet of retail space compared to USD 1000 as expected in India.
Given the global scenario, India should be high in the priority for fcuk.
14. BRAND CONSCIOUS
The Indian customer is aware of world trends because of growing travel overseas for business and leisure
travel where they get exposed to best of the brands and luxury trends.
Source: AT Kearney Research Report
17. HIGH EXPECTATIONS
High standards of service expectations as the Luxury Consumer will mostly have long term
association with the product
18. ATTRIBUTES OF “LUXURY BRAND” FOR
INDIAN CUSTOMER
VALUE FOR INTERNATIONAL HIGH QUALITY
HISTORY LONGEVITY EXPENSIVE EXCLUSIVITY
MONEY RECOGNITION AND SERVICE
Less important More important
Source ET consumer research across 6 cities and 4900 consumers
19. INDIAN LUXURY CONSUMER
Profession of Indian Luxury Consumer Age profile of Indian Luxury Consumer
Professional
5%
IT/BPO 45-50
8%
Years
Self
Employed 16%
9%
Industrialist
49%
25-34
Years
35-44
52%
Corporate years
29% 32%
India Luxury Consumer is typically a 25 – 34 year old entrepreneur
or a industrialist
21. INDIANS ARE VICTIMS OF HABIT
Consumers get accustomed to shopping abroad.
They rather spend 200 pounds on a shirt there, than Rs 20,000 here.
It is tough getting them to change.
22. IMPORT DUTIES ARE A HEADACHE
Steep duties translate to prices 15% higher than in Europe.
Jet-setting wealthy Indians hence shop abroad–means luxury brands often struggle to make a
profit in India
Indian presence is often seen as just a branding exercise.
23. INDIAN MEN LOVE TO SHOP
Around the world, the mix is a 60:40 (women VS men), but in India, it's skewed in favour of
menswear
Men’s formal wear is the fastest growing segment in India so it makes sense to focus on this
segment.
24. THIS SEASON’S TRENDS ARE MISSING
Luxury retailers offer a limited product range and stock second-rung products at astronomical
prices.
The customer thus, opts to buy from the stores abroad instead.
25. INDIA NEEDS NEW YORK’S FIFTH AVENUE
Luxury retailing in India is limited to a few shopping plazas, select high street locations, malls
and five-star hotel lobbies.
Just Three centers which are in the luxury segment are DLF Emporio in Delhi, UB City in
Bangalore and Palladium in Mumbai.
However, the right location and the retail ambience for a brand are crucial.
27. BRANDS SHOULD BE IN FOR
A 10-YEAR WAIT
Doing business in India is definitely not a wham-bam-thank-you-ma'am formula.
It's a slow process, but one that will eventually pay long-term dividends.
28. PARTNERSHIP IS KEY
Brands can JV with local partners which can help them understand local markets better.
With india’s FDI rules, having a local partner becomes profitable.
Prime examples are Reliance brands with Diesel , Genesis colors with Burberry, DLF Brands with
Boggi.
29. SOFTER PRICE POINTS
Brands would benefit by keeping their prices competitive and offering entry level products as
well.
Pricing products at a comparatively lower level than it’s international price can be a great
Investment towards brand building.
The Indian customer seeks the thrill of making a ‘steal’ bargain.
Initially the brand can bear the higher import duties partly helping the customer to get
oriented with the brand.
30. INDIANIZE PRODUCT
Foreign brands need to understand the Indian personality and fashion elements to ‘Indianise’ their
products.
A win-win situation for global brands is to utilize the talented and cost effective Indian designers.
It worked so well for fcuk in USA and UK, so why not in India.
32. ABOUT THE AUTHOR
Vijay Sharma is a graduate in Engineering from University of Mumbai
and is keenly interested in the fields of advertising, marketing,
business development and brand building. He loves presentations,
meeting people, talking, music and shopping.
You can mail him at
vijay_shrma@hotmail.com
