According to the UN, India’s total population is going to touch 1,5 billion by the end of 2030 as well as estimated to reach 1,7 billion by 2064. The country is forecasted to become the second-biggest economy by the year 2075 by Goldman Sachs. The Indian luxury market is set to cross $200 million in 2025 with an unsurpassed level of intra-travelling, digital space usage, and the rise of economic standards along with raving attractions from upper and middle classes. India’s largest luxury mall, Jio World Plaza, was unveiled at Bandra Kurla Complex in Mumbai in November 2023. It features 66 international brands such as Rolex, Dior, Gucci, and Louis Vuitton, as well as the first outlets for Tiffany & Co., Bulgari, and Versace. It is said that Louis Vuitton is paying a monthly rent of INR 4,05 million.

The luxury brands started to get more attention in 2023 with the country’s increasing appeal towards its market. Additionally, the retail sector is expected to reach new levels with around 20 global brands already competing on the market. Amazon has stated that it will be investing an additional amount of $13 billion in India by the year 2030.

With a market bearing several opportunities for brands and retailers, they must be ready with the diversifications of the geographical aspects in this region and how to target the people correctly.

Elite Urban Centers

India has eight cities listed as luxury capitals - Bengaluru, Mumbai, Chennai, Ahmedabad, Delhi NCR, Kolkata, Hyderabad and Pune. These cities are rich in people with high living standards and the richest statuses.

According to CBRE Research, around 70% of the luxury and jewelry consumers in India prefer physical brick-and-mortar stores to buy their goods. Here, flagship retailing will help the brands to get more connected with their customers and make them trust. Premium malls such as Palladium, Lulu Mall, Phoenix Marketcity, Jio World Plaza, and DLF Emporio can be ideal locations to set up flagships. Brands such as Coach, Canali, Cartier, Gucci, Rimowa, Hermes, Dior, Bulgari, Versace, Louis Vuitton, Manish Malhotra, Valentino, Abu Jani Sandeep Khosla, and many more have already set up their stores in malls. The global brands have to focus on the retailing type followed by local brands such as Sabyasachi and Tarun Tahiliani to learn the storytelling in heritage.

These tier 1 cities’ consumers have the habit of prioritizing in-store experience with service that can woo them in the first place. Word-of-mouth from the customers can really affect the potential customers’ minds too. It is important to incorporate butler services which include carrying the bags and assisting customers with refreshments. They have to encourage the audience to do hands-free shopping by requesting them to drop their coats and bags upon arrival. It is in retailers' and brands’ hands to come up with creative concierge services too.

WhatsApp has become a go-to app to build and strengthen customer relationships. Luxury labels Shivan & Narresh, and Le Mill have been using WhatsApp as their commerce platform and have seen 80-90% and 75% conversion rates respectively. Reliance Brands Limited has also created several innovative catalogs to post on the app to engage their customers during the COVID-19 lockdown.

Emerging Market Cities

Indian cities with a total population from 50.000 to 100.000 come under the Tier 2 category. Some cities are gradually emerging into this classification and are becoming a potential market due to a noteworthy increase in middle-class people driven by reverse migration. Since they are at the earlier stages, it gives a door for brands and retailers to invest in the cities now as the places are developing economically and growing an unavoidable demand for luxury retail. Labels can plan for long-term interaction with the customers here with marketing strategies that go well with the middle-class population. Here, the brands and retailers can hike their offline and online presence, unveil showrooms, and adjust their product catalog and regular price range. Rare Rabbit is an ideal example with premium collections at an affordable price. Labels like GAP and H&M are extending their retail presence by entering Guwahati and Ranchi.

Malls are like weekend and holiday-special getaways for the audience in Tier 2 cities. This location can play as a distraction for the customers from real life and give brands a place to build their retail stores. They have to keep an eye on all the notable holidays such as Diwali, Holi, and Eid to plan seasonal strategies. Brand activations, workshops with product demonstrations, and influencers as guests for a pop-up at the mall can be useful strategies in this situation. Nykaa held its third beauty activation event at Lulu Mall in Kochi in 2023.

There are successful e-commerce retail platforms like Myntra and Nykaa with a vast range of brands in their portfolio. With escalating exposure online and the surge of e-commerce shopping, these platforms can assist global brands in entering this market. Even though there is an increase in demand for in-store experience, the brands have to ensure their customers with online commerce for their convenience. Offers and discounts, products that can be easily found, and specific lines, window displays and aisles for festive seasons are part of the convenience in-store.

Vibrant Startup Hubs

Indore, Vadodara, Trivandrum, and Surat are the budding cities with encouraging young students and start-up companies. They have a mixed-versions of retail ground with an engaging community. By the year 2030, these cities have the potential to create 50 million new jobs and include $1trillion in the global economy.

These start-up cities have a demographic of new young and entrepreneurial consumers to look forward to. They want the creative experience to connect with. Therefore, the brands and retailers have the possibility to connect with them and support them by collaborating with them. Hiring local interns/apprentices and partnering with the start-ups are viable options.

This population has a messy time calendar with unpredictable climate changes. Many consumers will be comfortable with their night times due to the favorable climate and majority of work patterns. So, retailers and brands have to focus on creating a shopping experience that supports night and late hours as well as provides convenient times to shop and do leisure work.

India has the majority of youths with around 66% under the age of 35. These locations will have a youth population from different backgrounds and geographical regions. They need to be engaged offline, especially on weekends and after work.

Wellness-Focused Metropolises

Cities under this category are more calmer, cleaner, and comfortable spaces with healthier lifestyles. They have all types of consumers - from business people to worker classes with different lifestyles and statuses. This classification demands retailer strategies involving local communities and wellness moments.

Retailers can work on organizing activities in city centers, parks, and neighborhoods to reach more audiences. These hubs have natural environments such as mountains and lakes with a pleasant climate. This acts as an advantage for sports, activewear, and outdoor brands. They can conduct programs, art workshops, and active clubs for the people. Partnering with the local artisans, and young minds to reach in-depth.

Considering this category’s heritage and ecological aspects, the brands and retailers have to set up retail stores and outposts that are sensitive to the local community, sustainability, and domestic craftsmanship. It should be a tribute to the flora and fauna and take inspiration from the architectural sites of those cities.

Brands can launch pop-ups and collaborations that can offer leisure experiences with escapism. These cities have a busy professional schedule and many are interested in having a holistic wellness experience that serves as a vacation. Here, beauty brands can play a crucial role by providing wellness programs and other offerings to engage their customers.

Cover Image: Mumbai, Mysore, Indore and Coimbatore, courtesy Wassup Mumbai, Karnataka Tourism, Booking and Holidify.