India: Luxury’s looming youthquake

For years foreign brands have been put off by this country’s high import taxes (up to 50% for watches) and its shabby retail environment (there are no upscale shopping streets and few malls). But today India is experiencing a mall-building boom, perhaps a response to the sharp rise of newly affluent consumers—many under age 25. Analysts at Bain & Co. predict that the luxury market could grow 25% a year over the next three years—a far cry from the days when it was the exclusive preserve of Cartier-bedecked maharajas.

Most often mentioned luxury brands:

Three of the six most often mentioned luxury brands in India are local and cater primarily to men. Survey respondents who were asked to name the most familiar brands off the top of their head listed menswear labels—which can be explained by the fact that the majority of Indian women wear traditional saris. As foreign brands go, Swiss watchmakers have made the deepest inroads into this market, and only one foreign fashion label—Gucci—made the Top 10.

Park Avenue 51%

Allen Solly 45%

Rolex 34%

Omega 26%

Reid & Taylor 22%

Raymond Weil 22%

Best-known luxury brands:

Park Avenue 99%

Allen Solly 92%

Reid & Taylor 83%

Rolex 80%

Wills Lifestyle 72%

What Is Park Avenue?

With so many Indian consumers still opting for the traditional sari, it’s not surprising that menswear would be the fashion category leading the subcontinent into the world of luxury. There are other factors, like the climate, that explain the popularity of menswear brands like Louis Philippe and Crocodile. In India, shirts are considered outerwear, and these two brands are well-known shirtmakers. Other high-scoring local brands such as Park Avenue, Allen Solly and Reid & Taylor focus mainly on men’s business and formal attire (although they do manufacture women’s lines and traditional Indian clothing)—which means they cater to special occasions like weddings, considered the most important social event in India. Wills Lifestyle, the smallest of the brands above, may be more familiar to local fashionistas because it is a major sponsor of India Fashion Week.

What consumers want:

High quality 58%

Good reputation 55%

High fashion 50%

Percentage of affluent Indians who have heard of Marc Jacobs: 8%

Percentage who have heard of Yves Saint Laurent: 7%

Most widely owned brands:

1 Park Avenue

2 Allen Solly

3 Reid & Taylor

No. 1 shopping splurge in India: dresses

American brand they are most interested in owning: Calvin Klein

Beauty buying habits: The most popular purchase is fragrance—which can mean anything from a foreign brand to a local or custom-made scent. Most consumers who buy fragrance are responding to either the reputation of the brand or an advertisement they have seen. Thirty-four percent of respondents said they bought a particular perfume because it was expensive.

Where they shop for fragrance:

[This article contains a complex diagram. Please see hardcopy of magazine.]

Department store 44% Outlet store 36% Retail chain store 14% Internet 2% Catalog 2% Boutique 1% Other 1%

Average amount Indians will spend on a fragrance: $36

Top foreign beauty brands:

1 Clarins

2 Lancôme

3 Guerlain/Estée Lauder

Who they buy fragrance for:

THEMSELVES 58%

SOMEONE ELSE 16%

BOTH 26%

This TIME Style & Design poll of 410 affluent Indian respondents was conducted through personal interviews in June 2007 by GfK Roper at 40 different locations in Mumbai (formerly Bombay), Delhi and Bangalore in affluent neighborhoods and at upscale shopping malls, boutiques, hotels, car dealerships and fitness clubs. Respondents made at least 40,000 rupees a month. The margin of error is ±5%.