More than a dozen high-end consumer goods companies have set up shop in India in preparation for the next holiday season, hoping to cash in on the increasing discretionary wealth of Indians across the country. Executives believe that this growth in interest from western luxury goods is due to three factors: increasing exposure to global trends; younger people buying luxury products; and a post-pandemic boom.
Swiss high-end chocolate producer Laderach is among the several new and forthcoming brands to open a storefront in New Delhi's posh DLF Emporio shopping mall last week. The French department store Galeries Lafayette is expanding into India with the help of the Indian conglomerate Aditya Birla Group. Balenciaga SA, a Spanish luxury fashion business, is collaborating with retail giant Reliance Brands to open outlets. Other brands that will be making their debut include the Swiss luxury multi-brand watch and jewelry store TimeVallee and the Dutch haircare salon services brand Keune. As the Chinese economic engine slows, luxury companies are placing their bets on India's relatively steady growth and the increased demand it will generate.
The potential of the Indian market for premium and opulent brand experiences is without dispute. Elias Laderach, a member of the executive board and chief creative officer of Laderach, the largest chocolate retailer in Switzerland, expressed the company's high regard for the Indian market, its major cities, and its consumers.
In addition to selling through their own ecommerce portal, the family-owned luxury chocolate company that has entered India in cooperation with DS Group wants to open five to seven stores in India over the next two years.
A K-shaped recovery, according to experts, is what's drawing in high-end retailers from around the world. Bain & Co., a worldwide consulting firm, predicts that by 2030, India's luxury goods market will grow by 3.5 times its current size, reaching $200 billion. While inflation and other factors have hurt entry-level product categories, high-end items appear to be doing well.
Santosh Desai, a social analyst and columnist, has remarked, "The luxury market is inflation proof — consumers in this segment do not get impacted by inflationary trends." We're seeing packets that are four or five times more expensive in even the most basic needs categories. There is zero connection between these packs and the underlying structure. There is no doubt that the market for such products is niche, but the number of people who fall into that niche is growing rapidly and they are eager to spend money in every market segment. The term "K-shaped recovery" has been used to describe this trend.
It has been described as "a coming-of-age moment for Indian luxury" by Aditya Birla Fashion Retail (ABFRL), which has teamed with French luxury retailer Galeries Lafayette to open stores in India selling over 200 premium brands like Armani, Christian Dior, and Prada.
"India is now home to a generation of young and affluent consumers with global exposure," said Ashish Dikshit, managing director of ABFRL. The growth and activity of the luxury market are indicative of this. Galeries Lafayette's involvement signals their confidence in India's potential to serve as a growing center for high-end labels.
According to officials with knowledge of the company's plans, Reliance labels is rapidly expanding its existing ties with worldwide labels Valentino and Tiffany in preparation for the holiday season.
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