A couple of weeks ago Sukumar posted an article on PSFK about the size India’s luxury market. Now, Time Magazine seems to have taken up the thread with an article on "India’s Lust For Luxe".
What’s changing is India’s demographic makeup as the nation’s booming economy mints a critical mass of newly affluent consumers. Last year, the average Indian salary surged 14% (18% for IT professionals), the highest wage growth in Asia, according to a study by Hewitt Associates, a global human-resources company. There are now about 1.6 million Indian households that spend an average of $9,000 a year on luxury goods, according to The Knowledge Company, a management-consulting firm in New Delhi.
Apparently, they can’t get enough of Jimmy Choos.
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Thanks Guy. Interestingly, they have cited the same report that i referred in my post.
April 7th, 2006 at 11:16 am
We don’t even have a Jimmy Choo outlet here. And although luxury brands hog a lot of space in the media (they’re given out free to celebs) India is far far behind in luxury consumption compared to most countries.
There are a lot of fancy showrooms. Invariably empty. I’m not sure what falls under ‘luxury goods’. Diamond jewellery is selling. Not Cartier. Maybe high end watches. A lot of the luxury good shopping would be wedding related. And all of it is basically use of ‘black money’ ie money on which tx hs not been paid to the govt.
So sure, luxury brands are here and displaying their wares. Hoping to create a market. I guess human beings are the same everywhere and one day we will succumb. Right now though that number is far smaller than is being estimated!
April 7th, 2006 at 3:02 pm
Rashmi,
Thanks for the comment. I think it will be helpful if you could support your argument with some pointers to help our readers.
When i linked to the TOI report, i did a back of the envelope calculation based on the total estimated number of households. Per the NCAER (see this article on Rediff http://in.rediff.com/money/2004/mar/09shining.htm) there are going to be around 220MM households in India by 2010. Lets say there are 200MM households today, a 1.6MM high-end households estimate given by TOI seems plausible because it works out to less than 1% (0.07% to be precise) of the total number of households. I am sure we can imagine the top1% of Indian households to have a USD100,000 income which is really not that much.
April 8th, 2006 at 10:16 am