Luxury At A Click Goes To Towns
Once reserved for exclusive brick-and-mortar stores in upscale shopping districts, luxury goods have progessively become more accessible to Indian consumers through digital platforms in recent years. The trend, a fallout of the Covid-19 induced lockdowns, has brought about a remarkable transformation in the Indian ecommerce landscape. This surge in online luxury goods purchases has been fuelled by changing consumer preferences, increasing disposable incomes of a growing middle-income group, and the growing inclination to shop online even after Covid-provoked restrictions were lifted.
The Compound Annual Growth Rate (CAGR) of ecommerce in India has been robust and it is projected to continue to grow in the coming years. The CAGR for ecommerce in India had been estimated at around 25-30 per cent annually, making India one of the fastest-growing ecommerce markets in the world. This growth was driven by increasing internet penetration, rising use of smartphones, government initiatives and of course, changing consumer preferences.
Revenue in the ecommerce market is projected to reach $63.17 billion in 2023 and grow at a CAGR of 14.11 per cent through the years ahead to reach a projected market volume of $107.10 billion by 2027. A Redseer report says in the financial year gone by (FY 2023) online shopping transactions totalled $60 billion. This whopping big number emerged in spite of a waning surge in ecommerce since the lifting of pandemic-compelled restrictions on movement. The attractiveness of ecommerce in luxury goods endures partly because of the pertinent and cost-effective product offerings of online retailers and partly because of the consistent and standardised shopping experience on their platforms.
The evolution of ecommerce per se in India has been nothing short of spectacular. Over the past decade, the Indian ecommerce market has grown exponentially, making it one of the fastest-growing sectors in the country. The growth of ecommerce giants like Flipkart, Amazon, and Snapdeal, coupled with the rise of numerous specialised luxury ecommerce platforms, have contributed to this transformation.
*The Luxury Segment
The concept of luxury has evolved from being a status symbol to a lifestyle choice for many Indians, ushering in luxury ecommerce players into the country. Says Jayanti Ganguly, VP, Business, Myntra, “Being one of the leading players of India's luxury market, the Luxe segment on Myntra, caters to evolving consumer trends, particularly in the Millennial category expanding across geographies. A focused entry point on Myntra’s home page for the luxury segment, combined with the diverse and attractive collections by leading global brands, is a testament to our commitment to serving thousands of luxury connoisseurs in a seamless manner.”
Ganguly adds that India's luxury market primarily operates in the accessory and beauty segment followed by apparel, with ~30 per cent of Myntra customers having shopped from the category at least once. This indicates increasing inclination of customers toward high-end premium products. “Our robust portfolio across fashion, beauty, footwear, handbags, and wearables promises a delightful shopping experience. Some of the most sought-after brands on Myntra Luxe are from The Collective, which has brands including Ted Baker, Polo Ralph Lauren, Hackett London, Versace Jean Couture and Fred Perry, to name a few. Additionally, we have recently launched Just Cavalli and DKNY with the Iconic group, significantly expanding our selection in the handbags category. With a growing popularity amongst affluent customers and Myntra being the destination of choice for leading international brands in this category, Myntra Luxe’s apparel category has been witnessing a ~2X y-o-y growth on the back of strong growth of the overall luxury segment on the platform.”
*Rising Disposable Incomes
India's growing middle class boasts of higher disposable incomes. This upwardly mobile segment of the population displays an increasing craving for luxury items and ecommerce offers them a convenient way to access such products. The availability of high-speed internet and affordable smartphones has empowered Indian consumers to shop online. This has been especially beneficial for the luxury segment, as consumers can browse and purchase high-end products from the comfort of their homes.
Ecommerce brands are leaving no stones turned to cash in on this opportunity. Gopal Asthana, Chief Executive Officer, Tata CLiQ says that as an omnichannel platform, the brand is building Tata CLiQ Luxury as a luxury lifestyle destination for shoppers by embracing the principles of the ‘Slow Commerce’ brand philosophy. “At Tata CLiQ Luxury, we're experiencing tremendous growth that is being driven by both brands that have always been on the platform and done well, as well as new categories and luxury brands that are being introduced online for the first time. As a leading luxury ecommerce player in the market, we are targeting the top five million households, or one to two per cent of the top consumers in India. With a curated assortment of brands and products across leading premium and luxury global and Indian brands, the platform has an industry-leading NPS score and sees high GMV from repeat customers with high order frequency. Apart from the metros, the platform is witnessing healthy growth in tier-2 to tier-3 cities and towns as well.”
Tata CLiQ Luxury has one of the biggest collections of luxury brands on its platform. These include Aspinal of London, Armani Fragrances, Boss Home, Bvlgari fragrances, Estee Lauder, Memo Paris, Mulberry, Montblanc, Peugeot, Piquadro, Ralph Lauren Home, Roberto Cavalli Home, YSL Fragrances, and more. Says Asthana, “One of our biggest milestones this year, so far, has been launching TimeVallee, the luxury multi-brand boutique’s first-ever digital boutique in India, on our platform. Marking their entry into India, with this launch, luxury aficionados and watch connoisseurs can browse and shop from prestigious Swiss luxury watchmakers recognised for their heritage, such as Cartier, IWC Schaffhausen, Jaeger-LeCoultre, Panerai, Piaget, and Roger Dubuis, on the platform.”
Some of the other international brands that Tata CLiQ Luxury launched on the platform are Baldinini, Chiara Ferragni, Kendall + Kylie (footwear), Liu Jo, Pollini, Loci, Themoire, Twinset, etc. “We’ve also launched brands such as De Beers Forevermark in the fine jewellery category, Gauri Khan Designs in home and Le Mill in fashion. In addition, the platform continuously launches exclusive assortments from brands, the most recent one being timepieces from the True Thinline X Great Gardens of the World Collection, a limited edition from Rado,” says Asthana.
Apart from global luxury brands, Tata Cliq Luxury also plans to focus on expanding its portfolio in the Indian luxury market in the Indiluxe segment. Asthana says that the festive season is the biggest driver for ecommerce in India. “The sale during the festive period is a key growth driver for the ecommerce sector, as the festive season historically has been a high-spending season for the Indian economy. “Many of the sale events, including 10.10, which is the flagship festive sale hosted on Tata CLiQ, Tata CLiQ Luxury, and Tata CLiQ Palette, have a high recall value, and hence, consumers anticipate and wait for them for their festive shopping. The platform will be hosting a Black Friday sale in November to drive significant business and top-line revenue growth,” he tells us.
Luxury for Tier-2 & Tier -3 Cities
Ecommerce platforms are enabling luxury brands to reach out to consumers in tier-2 and tier-3 cities, which are increasingly turning into hubs of affluence. These consumers, while geographically distant from traditional luxury retail centres, have a strong desire for premium products. Moreover, the digital space allows for innovative marketing strategies, personalised recommendations and virtual experiences, enabling luxury brands to engage with consumers in a way that was hitherto only possible through physical stores. This not only enhances the reach of luxury brands but also allows them to establish a more direct and interactive relationship with their customers.
According to India’s latest ecommerce player Tira Beauty, an offering by Isha Ambani under the banner of Reliance Retail, festive season strategies represent a comprehensive approach designed to capture a more extensive market segment. A company spokesperson says that through compelling experiences like Gift with Purchases (GWPs) Tira goes the extra mile with personalised touches both online and offline. It offers customised gift boxes and has a dedicated gifting Lab, which enables consumers to engrave names or initials on selected items. Positioned strategically for the festive season and backed by a robust support network from Reliance Retail, Tira boasts of an expansive reach, spanning over 100 cities and covering 98 per cent of India's PIN codes.
As Tira expands its store presence in Mumbai and beyond, strategic collaborations with global and local brands underscore a burgeoning demand in the market. Notably, Tira has astutely observed market trends, securing an exclusive partnership with the Korean brand Blessed Moon, in response to the increasing popularity of K-beauty products.
*Ethical Luxury Brands
Ethical and sustainable luxury brands are increasingly being welcomed more on ecommerce platforms, catering to a growing segment of conscious consumers who seek products that align with their values. These brands place a premium on responsible sourcing, environmental sustainability, fair labour practices and transparency in their supply chains. Ecommerce platforms provide them with an ideal avenue to showcase their commitment to these ethical principles. Customers can easily access detailed information about the origins and production processes of products.
The convenience of online shopping and the ability to reach a global audience allows ethical luxury brands to expand their reach and connect with like-minded consumers who prioritise both opulence and ethical responsibility. In this way, ecommerce is not only transforming the way we shop for luxury, but is also shaping a more conscious and sustainable future for the industry.
Amala Earth is one such ecommerce platform in India. Gunjan Jindal Poddar, Founder, Amala Earth says that the festive season offers the perfect opportunity for consumers to make festivities all about tradition along with mindful and eco-friendly practices. “At Amala Earth, customers can find a wide array of products to suit a myriad sensibilities and budgets and our earth-friendly sale is curated to ensure that everyone finds something natural, artisanal, handcrafted and earth-friendly at our one-stop marketplace. As a conscious shopper you will find a wholesome range of products from mindful eating to eco-friendly fashion; from handcrafted home décor to pooja essentials in natural materials; from chemical-free beauty products to natural home cleansers, wooden toys and baby essentials, there’s lots more to explore on Amala Earth.”
Poddar adds that it is no longer just about the basics but unique products like handwoven linen sarees, organic linen dohars (duvets), pure linen bedcovers and table cloths, mulmul (muslins) curtains; mango wood, teak wood tableware; kansa (bell metal) dinnerware, cast iron cookware, Ayurvedic cosmetics, pure ghee, cotton and linen co-ord sets, wooden games and crochet toys, plant-able stationery, bamboo towels, coconut shell serve ware, brass puja thalis (trays) soy wax and beeswax candles, curated gift hampers etc. “We have over 700 premium brands and over 80,000 products curated for discerning customers across the length and breadth of the country. From natural and traditional materials to an array of colours that are in sync with the rich cultural heritage of India, our one-stop marketplace is all about making every day earth-friendly,” says Poddar.
The luxury e-commerce landscape in India is undergoing a significant transformation, as more and more consumers turn digitally savvy and look for convenient ways to access luxury products. The convergence of technology, changing consumer behaviour, and the craving for luxury has created a perfect storm for luxury ecommerce in India. Opportunities abound for those able to navigate this evolving market and reach out to India’s aspirational consumers.
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