Boston Consulting Group forecasts due to the COVID-19 pandemic, global luxury sales could plummet almost 35 per cent in 2020 compared to 2019. According to Abhay Gupta, Founder and CEO, Luxury Connect, a luxury brand management firm, India’s luxury market could take an even bigger hit than the global average as sales could drop almost 50 per cent. The Indian luxury market is much smaller than that of the US and China. April report of Statista notes this market will be worth $7,956 million in 2020 and grow annually by 10.6 per cent CAGR between 2020-23, with cosmetics and fragrances forming its largest segment.
Cecilia Morelli Parikh, Founder, Le Mill, a Mumbai-based luxury concept store feels, the phenomenon of revenge buying which helped the luxury sector to rebound in China, may play out in India too since consumers will not be able to travel for leisure—earlier, lower duties and taxes made purchases abroad attractive. However, Gupta believes it will have a different impact on different categories. Beauty and wellness category will the first to see sales surge as people are missing going to salon for self-care and wellness.
However, people are likely to become more conscious of the quality and quantity of clothes they buy especially luxury apparels. They may not prefer to invest in luxury fashion without a tactile experience.
Luxury shopping becomes subdued
Just like in China, India’s luxury shoppers may display a demure, classic and refined trend which was popular in the last few seasons as they might not have as much money and will think hard about what they want to buy. Rather than flashy or ostentatious clothes, they will opt for more neutral colors and smart silhouettes offered by brands such as Jil Sander, Loewe and Phoebe Philo. Conscious consumption will replace conspicuous consumption amongst these affluent consumers.
Another trend that is expected to rise amongst these shoppers is the preference for online shopping. To satiate this need, retailers like Le Mill plan to launch their own website. The retailer is already selling 70 per cent apparels through whatsApp and home deliveries.
Emerging shopping trends
Besides going online, some luxe retailers also plan to implement appointment-based shopping once the lockdown is relaxed. Also, only 60 per cent of staff will be present in a store on a given day.
Similarly, Collective-one of India’s largest luxury retailers, plans contactless delivery system for the first month and a half. For this, the retailer will send out a few selected items for customers to pick and choose. This system can be availed by everyone, though it might work better for retailer’s existing customers.