|CURRENT ISSUE NOVEMBER 22, 2004|
|COVER STORY: LUXURY BRANDS|
These brands include some of the world's most celebrated: Fendi and Louis Vuitton, Canali and Bvlgari, Cartier and Hugo Boss, Dolce & Gabanna and every Swiss luxury watchmaker worth his diamond bezel. Last week, Jaeger-LeCoultre launched its Grand Reverso watch priced at Rs 20.8 lakh, while for those with higher aspirations, there is always Cartier's made-to-order Tank Francaise with more diamonds than there are days in a year, and priced at Rs 2.03 crore.
Unlike a few years ago, when consumers like the Dhariwals had to do their shopping in London, Paris and New York, the world's leading luxury merchants are realising that they cannot ignore the Indian market. As Bruno Saelzer, head of the eclectic designer label Hugo Boss, says, "The economy of India has picked up significantly in the past few years. There is a wider pool of wealthier Indian residents who have the purchasing power and the desire for high-end luxury goods."
Like Atul Dheer, 36, a handicrafts exporter who has just picked up a Tag Heuer watch for over Rs 1 lakh. As he says, "I want the best and you can get the best in India today. Since you are buying here from the legal market, you get warranties and proper bills."
Compared to western markets, India is still a niche market for luxury products, but it is one that is growing fast and producing aspirational lifestyles where, unlike the earlier decades of socialist populism, display of wealth and luxury are no longer a dirty word. As Gaurang Sahay, a sociologist at the Tata Institute of Social Sciences, Mumbai, says, "The consumption of luxury goods is a kind of a superstructure of a capitalist society. People who have a lot of cash and are influenced by the media will want to purchase luxury goods that will make them stand out from the crowd." Like jewellery designer and socialite Queenie Dhody who remarks: "I would hate to carry something that is common. I'd rather go for a Vuitton bag which is rare and a limited edition."
In today's deluxe India, the children of your domestic staff are wearing Levi's and Lee. For the brand-conscious and trendy, it has to be the Swarovski-encrusted Seven for All Mankind Jeans, specially made for the Indian market. In fact, if you have got the cash, there is no limit to the splash. Bentley's Grand Arnage comes with a price tag of Rs 4 crore, Samsung's ultra-slim 60-inch plasma screen TV costs over Rs 10 lakh, the Bose Lifestyle 48 HES home theatre system comes with a price tag of Rs 2.57 lakh, Mont Blanc retails a diamond-encrusted pen for Rs 50 lakh, Ermenegildo Zegna's top-of-the-line, custom-tailored suit will set you back some Rs 6 lakh and a mid-range Louis Vuitton briefcase can go up to Rs 1.27 lakh. Last month, Nokia launched its limited-edition luxury brand of mobile phones, Vertu, in India at prices ranging from Rs 3.7 lakh to Rs 19 lakh.
Retail management company KSA Technopak pegs the market for luxury and high-end clothing in India at Rs 1,000 crore and for accessories at another Rs 1,000 crore. Says Saloni Nangia of KSA, "With the entry of first movers into the market, a host of international luxury brands are evaluating the opportunity offered by India."
What has facilitated the entry of these brands is the lowering of duties in some cases and easier regulations for automobiles, inspiring luxury automakers to launch their vehicles in India or expand their existing range. Mercedes is the perfect example. DaimlerChrysler debuted in India in January 2000 with a petrol and diesel version of the E-Class. Eight months later, it brought in the S-320, followed by the C-Class in April 2001, the E-240 in October 2002 and in March 2003 came the S-350 L. The Mercedes range now boasts the new E-200 along with the SL-Class, the sporty SLK and Mercedes M, their luxury SUV.
Despite the numbers and an appetite for quality, India has not known real luxury experience till very recently, if one discounts the watch and writing instruments brands that came in earlier. In the past, mid to high-end brands like Alfred Dunhill, Mexx, Liz Claiborne and Pierre Cardin tested Indian waters but came with a limited collection or dumped old stocks. They had to beat a hasty retreat, leaving behind an impression that India was a value-for-money mass market.
It took a true-blue luxury brand like Louis Vuitton, a pioneer in testing new markets, to disprove this theory. The flagship leather accessories brand of the French luxury goods conglomerate LVMH (Moet Hennessy Louis Vuitton) opened its first store in Delhi last year only to discover that there exists a segment that has a voracious appetite for premium, aspirational products. Says Prasanna Bhaskar, retail head of Louis Vuitton India: "We knew there was a market for us in India but even we were overwhelmed by the response. The critical factor behind our success has been the simultaneous launch of products and services in our flagship stores in Paris and India. This earned us the trust of the Indian consumers."