As the Indian luxury market enters the next phases of development, the rewards of this potentially massive market will continue to attract foreign investment. However, India is not just another emerging market. It is a market of contrasts, contradictions and extremes. Numerous luxury and fashion brands have exited the Indian market or re-entered with a modified strategy. For example, Dunhill recently announced its withdrawal from the Indian market. There is no guarantee to market success. The dynamics of the Indian luxury market challenge international luxury companies to develop an Indian-driven strategy.
This raises the question how international luxury brands can resonate with the Indian consumer? Many international luxury brands are held in high esteem but are competing against an array of local brands that enjoy the aura of tradition, heritage and prestige. Luxury brands need to develop relevance that goes beyond the logo of the brand. This involves a fine balance that integrates the brand’s global values with Indian meaning. A ‘Made for India’ has already been recognized as key to market success. For example, Hermès launched a collection of sarees that represents a fusion of western and local influences. However, the notion of Indianness needs to go beyond the physical product offering but to be incorporated across all touchpoints of a holistic luxury brand experience. The following five interactions of Indianness are examples of how luxury brands are able to connect with the Indian consumer.
1) One obvious interaction of Indianness is Bollywood. Many international luxury and fashion brands have used the aspirational appeal and associations of Bollywood to reach out to new and emerging consumer classes. Louis Vuitton, Dior, Chanel and Hermès have all used product placements in Bollywood blockbuster films.
2) Royalty patronage is a defining feature of luxury in India. Whether it was the Rajputs of Rajasthan or the Nizams of Hyderabad, luxury in India has been associated with the royal dynasty. Cartier ‘Travel with Style’ Concours d’Elegance is a heritage motoring event that attempts to reconnect with the past and revive the brand’s royal heritage.
3) Indian weddings and religious festivals are lavish and extravagant occasions for celebration. It is also an important shopping occasion for Indian consumers. Luxury brands have started to leverage these culturally important purchase occasions. For example, Moët Hennessy can instruct their in-house chef to create a menu harmonized with any of the wines or champagnes that a customer has purchased from them for a wedding event.
4) The family bond has a very special place in Indian society. Indians shop as a family and even the pleasure of luxury consumption is a family affair. The success of champagne brunches hosted in luxury hotels is an occasion where families can spend an enjoyable and memorable time together.
5) The notion of outstanding service has a very unique standing in India that goes beyond the normal practices in the West. Salvatore Ferragamo, Paul&Shark and Ermenegildo Zegna have introduced home shopping services where customers can shop in the comfort of their home.
If international luxury brands are to succeed in India, they will need to market the ‘Indian way’. This doesn’t mean that they need to compromise on their heritage but to be relevant that has meaning in an Indian context. International luxury brands need to seize this opportunity.