The Changing Face Of Luxury In India
In the past few years, luxury in India has been growing at a compound annual growth rate (CAGR) of about 25 per cent. As per a report by Assocham, the market is expected to exceed $18.6 billion by 2016-17. Interestingly, as per Amitabh Kant, CEO, Niti Aayog, the luxury industry in India has the potential to grow 10-fold from its current size and reach a top line of $180 billion by 2025.
The Indian luxury landscape is clearly experiencing strong evolutionary undercurrents that are redefining the consumer profile and also how luxury players need to operate in this domain.
Service areas such as fine dining, electronics, luxury travel, luxury personal care and jewellery have seen increasing revenues and are expected to grow 30-35 per cent over the next three years. Spending on luxury cars continues to rise growing upwards of 18-20 per cent. As the purchasing power of women is rising in India, luxury beauty products market is witnessing a fast-paced growth. According to Euromonitor International, the luxury product categories that have recorded considerable growth are luxury jewellery as well as timepieces, luxury writing instruments/stationery; super premium beauty/personal care products, luxury electronic gadgets and luxury tobacco.
Besides, the Indian luxury market is developing many facets. Luxury is no longer restricted to the rich and famous alone; the new age consumers, who do not typically fit into the boardroom definition of luxury consumers, are staking claims to luxury products, brands and services, but on their own terms.
Luxury is no longer the privilege of the few who were born into wealth. There is now a larger consumer base, which has the money to splurge but want a real value proposition. Going forward, this will be the biggest challenge faced by luxury brands this year.