Geographic boundaries will no longer be a limitation for luxury retail in India. Growth in the country’s luxury market will be driven by those living in tier II and III cities, says a recent report by CII-IMRB International.
The report — Emerging Consumers of Luxury – India Tiers 2 & 3– has been created through a face-to-face research with high net-worth individuals in non-metros, men and women in the age group of 20-55 years, with an annual household income of over Rs 1 crore. It was conducted in multiple tier II and III cities, including Chandigarh, Ludhiana, Kanpur, Coimbatore, Bhopal, Patna, Kochi and Rajkot.
“It’s amply clear Indian men in non-metros continue to seek power and status to validate their position in life, just like their urban counterparts. While non metro women are happily indulging themselves, encouraged by the exposure to international fashion and fascinated by the easy availability of hitherto inaccessible luxury products, they seek high fashion and style and are ready to pay for it,” the report said.
While globally the Indian market is the 5th largest consumer, its share in luxury segment is yet to capture the top 50 for most categories.
However, the report found out that women in small towns are a cautious group with just a couple of designer handbags to ensure just the right impression in society. They still carry their cultural baggage along with a new found modern and semi-westernised identity.
The top three aspects Indian consumers value in Luxury Products currently are Quality, Luxuriousness and Fashion Quotient. However, despite this, luxury brand communication in India is very imagery and celebrity-led, except in categories like automobiles.
In the tier II and III cities surveyed, luxury automobiles have the highest penetration, followed by apparel for women and accessories for both sexes, found out report.
Electronic gadgets like mobiles and home electronics also have reasonably high penetration.
Men’s watches too, are a category often portrayed as signals of power, heritage and opulence, thus fitting in with the need for social signaling, whereas men’s apparel even in metro India is yet to get into the luxury sphere with any intensity.
The more esoteric or experiential aspects of luxury ownership – art, travel etc – are still at very low levels of penetration, arguing for a consumer who is as yet on the preliminary, signaling, level of luxury consumption. Few luxury consumers in the smaller cities seem to be in the individual/ self-identity state of mind.
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