This three-episode series explores the Indian luxury market, including its growth forecasts. The first episode explained how the number of dollar-millionaire households in India would increase in the coming years and also analysed the impact of the country’s digital transformation following a focus on India’s purchasing behaviour during the Covid-19 pandemic. This episode number two will address Indian millennials’ powerhouse, while the third and last chapter will discuss the possibilities of menswear brands in the country with a detailed case history.
What a millennials’ powerhouse can bring to India: the large youth population offers both workforce and target market
India is home to a fifth of the world’s youth population. This will create a demographic dividend that could play a critical role in achieving the nation’s ambitious target to become a US$ 5 trillion economy. The large youth population offers both a workforce as well as a market. These young people are driving a culture of innovation, entrepreneurship and diversity.
Some fashion illustrations from a collection designed by an Istituto Marangoni Mumbai student
A recent study by consulting firm Deloitte and the Retailers Association of India indicates that millennials now make up 34 per cent of the total population in the country. The report also shows that millennials in India are better connected to global trends than previous generations. They enjoy higher disposable income levels and are driving changes and rapid growth across multiple consumer segments; their reliance on the Internet to shop and discover new brands is also shifting the economy towards an omnichannel experience. These fundamental changes in the Indian economy create new opportunities for luxury brands in the country; those brands that successfully embody the lifestyle and values that new Millennial consumers aspire to will enjoy tremendous growth.
What Indian millennials are asking from international luxury brands
“Affluent Indians celebrate the duality – and fusion – of global luxuries and indigenous Indian brands in their lifestyles,” says Manoj Adlakha, CEO of American Express in India. “But growing in the hearts, minds, and share of wallet of affluent consumers will require more than just showing up.”
International brands are increasingly bullish on expanding their footprint in the country and boosting their brand awareness. But in one of the world’s largest and most populous nations, brands must pay attention to consumer trends and behaviours since they differ across regions, cities, and social groups: employing a “one-size-fits-all” approach won’t work.
While Delhi and Mumbai continue to have the highest number of millionaire households, high taxes and the COVID-19 pandemic might shift. Moreover, even in these cities, consumer behaviour is not linear, and the young, spendthrift millennial cohort doesn’t have the same consumption habits as older generations.
The Gateway of India in Mumbai
Furthermore, millennials are unafraid to navigate each segment of the fashion pyramid, moving from high and low, from Indian to international luxury brands with ease. That “ease” was not visible in the previous generations, making it an equally exciting and challenging space for brands to tackle.
These young consumers also have absolute expectations that brands will answer their questions on sustainability, political affairs, community building and so on, and are ready to move on to another brand if a certain label is unable to deliver on its promise.