India’s luxury landscape is at a crucial juncture. With a booming economy, the world’s largest population and a dynamic, youthful demographic, the country has been dubbed the next luxury hub, especially at a time when luxury consumption in China is declining as spending softens.
Is the centre of the world’s luxury market shifting from China to India, as a fast-growing appetite in goods such as high-end watches suggests? And, if so, how should brands approach and win over luxury clients in this market known for its millennial craftmanship and strong culture?
India by the numbers: growth and opportunities
Home to the world’s fifth-largest economy, India is currently seeing explosive growth in its luxury sector. At a recent event by luxury consultancy IndLux in partnership with INSEAD, IndLux CEO François Grouiller said, “The next 100 years will be marked by the rise of India, and we believe that the Indian century can become an opportunity for all.”
The country’s luxury market, currently valued at US$17 billion, is set to more than triple by 2030, growing to upwards of US$85 billion. Years of impressive GDP growth have turned India into the world’s fastest-growing major economy. This economic surge will boost the number of ultra-high-net-worth individuals – people with a net worth of at least US$30 million – by an anticipated 50 percent by 2028.
“When it comes to India, don’t take a snapshot, focus on the trajectory,” said Mahi Khanna, project lead at IndLux. Indeed, the expanding middle class and their growing disposable income are propelling what will be a US$2.2 trillion retail market by 2030, which will make India the third largest globally.
Unique to India are the country’s cultural and historical ties with luxury, both older and stronger than in many other markets. As Khanna observed: “Luxury is as old as our civilisation – it is part of India’s cultural and historical DNA.” Luxury has deep roots in the subcontinent, from the Maharaja of Patiala, known as the largest owner of Cartier jewellery, to the intrinsic cultural value placed on artistry, craftsmanship and opulence.
But local and foreign brands face various challenges tied to the landscape: a complex regulatory environment, inadequate luxury retail infrastructure and consumer behaviour nuances that demand a tailored approach.
The need for clear personas in a young market
Representing 40 percent of urban consumers, 377 million Indian Gen Zs (people born from around 1995 to 2010) make up the largest generational cohort in the country. They contribute to 43 percent of overall consumer spending, setting a significant economic precedent. Notably, 76 percent of Gen Zers in India are open to trying new brands, creating a ripe environment for both established luxury houses and newcomers.
However, success requires clarity in targeting distinct personas within this diverse generation. Research of key stakeholders – including wealthy Gen Zers and top influencers, whom IndLux named “the Catalyst Generation” – highlighted five major Gen Z personas with different expectations:
- The “Gram Kid”: Influenced by social media and keen on elevating social status, in line with the global trends cycle.
- The “New Maharaja”: Prefers silent luxury without conspicuous logos, focusing on quality and cultural connections.
- The “Devoted Nurturer”: Prioritises family and meaningful experiences, emphasising luxury as an investment for shared joy and collective pride.
- The “Local Loyalist”: Balances an affinity for global accessories with a deep respect for local craftsmanship, signalling a dual identity.
- The “Nuance Seeker”: Values sustainability, craftsmanship and meaningful luxury. Well-travelled (and often returning to India after having worked, lived or studied abroad), appreciates understated elegance and often seeks unique, purpose-driven brands that align with their personal values.
Luxury brands looking to access this young market must tap into this subset of wealthy, metropolitan Gen Zers setting the pace for emerging luxury trends in India. To do so, they must develop a nuanced understanding of these personas, emphasising customised, local and culturally resonant experiences.
“INSEAD, a contraction of “Institut Européen d’Administration des Affaires” is a non-profit graduate-only business school that maintains campuses in Europe, Asia, the Middle East, and North America.”
Please visit the firm link to site
