LUXURY BRANDS MARKETING
Over years, India’s tryst with luxury brands has changed gears. With high disposable incomes and a penchant for all things luxury amongst affluent Indians on the rise, the country is emerging as the next stopover for global luxury brands such as Gucci, Christian Dior and Versace. However, we must realize that Luxury marketing is a whole new ball-game altogether, both from the perspective of the marketer as well as the luxury consumer. It therefore becomes important to view it both in relation and isolation from the ‘regular’ goods marketing. To achieve the above objective, we would first look at how luxury goods are different from regular goods and then go on to explore some facets and trends of the luxury goods as well as their market and consumers. This analysis would finally sum up into a SWOT analysis of the luxury goods segment, thereby helping in obtaining a bird’s eye view of the exercise at hand. Considering that the luxury concept has shifted to the ‘new’ meaning, we would further delve into that aspect to understand the drivers for luxury brands presently, as well in the time to come. This is followed by a luxury potential determination of the Indian market both in terms of quantitative growth factors as well as qualitative initiatives.
Objectives & Sub Objectives6
Getting To Know Luxury8
Difference Between Regular & Luxury Goods10
Luxury In India14
The Affluent Indian: Profiling The Indian Luxury Consumers17
Classification Of The Indian Luxury Consumer21
Strategies For Luxury Marketing In India57
“Why do I need to know how the watch market is doing? I’m in the business of luxury” Partick Heiniger, CEO, Rolex
GETTING TO KNOW LUXURY
Luxury brands have often been associated with the core competences of creativity, exclusivity, craftsmanship, precision, high quality, innovation and premium pricing. These product attributes give the consumers the satisfaction of not only owning expensive items but the extra-added psychological benefits like esteem, prestige and a sense of a high status that reminds them and others that they belong to an exclusive group of only a select few, who can afford these pricey items. The luxury sector targets its products and services at consumers on the top-end of the wealth spectrum. These self-selected elite are more or less price insensitive and choose to spend their time and money on objects that are plainly opulence rather than necessities. For these reasons, luxury and prestige brands have for centuries commanded an unwavering and often illogical customer loyalty. Luxury, derived from the Latin word luxus, means indulgence of the senses, regardless of cost. Luxury brands are brands whose ratio of functional utility to price is low while that of intangible utility to price is high. Such brands share characteristics like consistent premium quality, a heritage of craftsmanship, a recognisable style or design, a limited production run of any item to ensure exclusivity, an element of uniqueness and an ability to keep coming up with new designs when the category is fashion-intensive. THE market for luxury brands in our country has expanded in recent times. With income levels going up, customers prepared to buy such brands are growing in numbers. According to an NCAER Household Income Survey, in 2001-02, there were 20,000 families in India with annual incomes of more than Rs 1 crore. By 2005, that number increased to almost 53,000. By 2010, India will have some 1, 40,000 crorepatis. Retail management company KSA Technopak estimates the market for luxury and high-end clothing in India at Rs 1,000 crore and for accessories at another Rs 1,000 crore.
CHARACTERISTICS OF THE LUXURY INDUSTRY
1. Luxury is a product...