India: The New El Dorado of Luxury. Is your brand ready?
The luxury market in India has witnessed unprecedented growth over the past decade, establishing itself as one of the most promising destinations for global luxury brands. Below, we present the key reasons why luxury firms should consider immediate entry into this emerging market.
1. Economic Growth: According to the World Bank, in 2021, India was the sixth-largest economy in the world, with a GDP of $2.87 trillion. This growth is expected to continue, driven by economic reforms and an expanding middle class.
2. Rise of the Middle Class: The Brookings Research Centre estimates that India will add 140 million people to its middle class by 2025. This growing middle class has an increased willingness and spending capacity, especially for luxury goods.
3. Young Demographics: India has one of the youngest populations in the world, with over 50% of its population under 25 years old. These young individuals, influenced by global trends and with an increasing desire for branded products, are willing to invest in luxury goods.
4. Digitalisation: With over 700 million internet users in 2022, India has experienced a surge in e-commerce. Luxury brands can leverage this channel to reach a broader audience.
5. Brand Culture: The perception of luxury brands in India has shifted. They were once seen as unattainable, but now they are symbols of status and success. The aspiration towards renowned international brands has grown, presenting a massive opportunity for luxury firms.
6. Infrastructure Development: Cities like Delhi, Mumbai, and Bangalore have seen the emergence of shopping centres and luxury districts that provide the perfect environment for hosting premium brands.
7. Cultural Diversity: India's vast cultural diversity offers a unique opportunity to personalise and adapt luxury products, which can result in a stronger connection with local consumers.
8. Limited Competition: Although several luxury brands have established their presence in India, there is still room for new entrants, meaning firms entering now will have a competitive edge.
9. Trend towards Luxury Experiences: Indian consumers are showing increasing interest not just in products but also in luxury experiences, such as luxury travel, gourmet dining, and exclusive services.
10. Historical Connections: India has a long-standing tradition in luxury craftsmanship, from jewellery to textiles. Brands that incorporate this rich heritage into their offerings can deeply resonate with the local clientele.
The luxury market of India presents a golden opportunity for brands looking to expand into emerging regions. The combination of a growing economy, a favourable demography, and a rising appreciation for luxury makes India a market that cannot be ignored. It's imperative that luxury firms act now to establish a solid presence and capitalise on this vast potential.
