‘Luxury is about disposability. It is not a luxury to write with a Mont Blanc or a Cartier pen as much as it is a luxury to write on a Mont Blanc or Cartier writing pad, read it, ponder over the scribble, be unamused, tear the page and throw it in the bin and not even think about it. Luxury is about disposability’ remarks Ashmit S Alag of Transform Retail Design.
Brands such as Louis Vuitton (handbags), Gucci (accessory brand), Fendi Casa (handbags, eyewear, fragrances), Zumtobel (lighting), Versace Home (furnishing) have already forayed into the Indian retail environment. Malls like DLF Emporio, U B City have been build to capture the attention of the cities’ most wealthiest crowd. Luxury only seems to grow in size in the coming years.
The number of millionaires in India rose 51 per cent to 126,700 last year, according to the 2010 World Wealth Report by Bank of America Corp's Merrill Lynch & Co and Cap Gemini SA. Retailers need to keep an eye on this retailing not just to upgrade their products but also who keep an eye to enter in this business full fledged.
Let us understand some core concept of luxury retailing and its peripherals:
Goods that sell in India
Pens, Leather materials—bags, wallets, apparel, eyewear, watches, fashion apparels. Though the trend has been that females take the stride proudly but now-a-day’s men’s population is also giving competition to their counter parts in luxury spending.
Abhijeet Das, Marketing Head, Delhi Duty Free at T3 says, “ Customers here at T3 buy writing instruments like Mont Blanc ranging between $800 to $8000 or Swarovski design jewellery sells in the range of $300 to $3000.”
- Main Cities: Delhi, Mumbai and Bangalore
- Luxury locations: DLF Emporio (Delhi), UB City (Bangalore), Paladium (Mumbai) and the 5-star hotels have components of luxury shopping.
Luxury means twice the space of regular retail environment
“Almost Definitely,” says Ashmit S Alag, The Chief Designer, Transform Design. He explains, “Luxury store requires twice as much space as any normal retail outlet for a merchandise. The amount of negative space (empty space) should be enough to solely highlight the merchandise kept for greater visibility and admiration in its eternity. “
The cost of investment starts from Rs 3000 and above which can go upto Rs 15,000 per sq feet calculated on the carpet area of about 1000 sq ft and above.
Says Ronak Sheth, Director, Eternity Lifestyles, “As far as eyewear is concerned, Rs 5000-6000 per sq feet would give the desired result.”
Says Chetan Singh, MD, Venire, “You need to sit with the designer to generated unique ideas to bring opulent shopping environment for wealthy shoppers. VMs, flooring, lighting and the whole concept should be truly international and replica of the ambience of same brand overseas.”
Store should reflect a story telling atmosphere
Finely defining luxury product, Sheth of Eternity Lifestyle says” you need to understand each and every piece kept in the store in detail—which as every brand has been build over time. The product reflects its unique heritage and a retailer plays the role of a storyteller between the brand and the end user. The whole concept of the store is to be designed that accentuates the identity of the brand and the collection.”
Burn the extras
Says Ashmit Alag, Transform Design, “To maintain the exclusivity of the collection, brands would rather burn the products but not go on sale.”
Exclusitivity and not range is what luxury merchandise focus at.
Customer loyalty is more important than brand awareness
Unlike regular buyer, each customer in luxury retailing is treated personally to understand his/her choices and tastes. Gaining the customer loyalty and entertaining the client with his taste of collection saves time and effort. Ambika Nair, Marketing Manager – DKNY elaborates, “A strong relationship is to be built with the customers such as calling them on their birthdays, anniversaries and inviting them for special sales or launch previews. Sometimes in-store events are organized exclusive for our patrons.”
- Highly Customized services or limited stock of products
- Very High personal services: Orders for latest collection is carried out keeping in mind his kind of clients’ taste and preferences.
- Pre-orders—for example at DDF customers can pre-order a product for himself and he is taken care of.
Lack of Luxury ambience in India but slowly gaining the momentum
Luxury spending in India, the world's second-most populous nation, was less than a tenth of that in China last year, according to Bernstein Research 2010.
Lack of exotic shopping ambience and sparse collection diverted the flock to spend overseas. There is still dearth of good shopping experience (though it has improved—DLF Emporio, UB City mall, and many hotel locations) which can match the high streets in Paris, London and Milan where the wealthy shoppers don’t mind to drive 4000 miles to shop for their favourite brands !
In India, the customer does not get the feel and the ambience even if he has access to the international brands.
Initiatives have been taken by Murjani Group to build the Galleria in Mumbai, which it says was the first Indian shopping centre where most tenants sold high-end products targeted at the rich. Before that, luxury stores were mainly located in five-star hotels in New Delhi, Mumbai and Bangalore.
Says Abhijeet Das, Marketing Delhi Duty Free, “Since travelling is increasing, more and more international brands are foraying with their latest collection. Here at T3, for the first time, brands would be available in duty free arena, which we hope would increase the sales.”
DDFS has recently opened three new showrooms of Hugo Boss, Mont Blanc, MCM, Samsonite Black and Swarovski to bring together a wonderful selection of fashion concepts that complement each other perfectly. The initial response has been incredibly positive, with the passengers expressing their delight at the unique range on offer, while enjoying the benefits of duty-free prices.
In conclusion, the whole concept of luxury retailing both at macro and micro level, has to be understood in detail to grab the attention of the target group as there is a positive trend that shoppers are giving domestic market also a chance to get a share from their wallets.