Preserve the
Luxury
or
Extend the Brand
In context with Indian
Market
Indian
Consumer
Market
Indian consumers are becoming increasingly
demanding and knowledgeable. Urban as well as
rural consumers know what they wa...
The opportunities -- and the challenges -- posed by the
Indian market are enormous. The world's second most
populous natio...
India is a booming emerging
market.
Today, the demand for luxury brands is ever increasing and
brand offering is continuou...
Luxury Brand
Segment in India
The fast rising Indian Consumer Markets has attracted many
Luxury brands from the worldwide to set up their business in
In...
From about $3.66 billion in 2007, the luxury market
has more than doubled to $7.58 billion in 2013.
According to industry ...
The Key Consumers
The CII-IMRB report said luxury is no longer restricted to the
rich & famous alone, the new age or 'closet consumers'
who ...
Who are
CLOSET
Consumers
Closet consumers are cost-
conscious and seek “value”
even when buying luxury products.
And their definitions, symbols of
...
These are new generation entrepreneurs,
senior corporate executives,
farmers who have sold their land to developers ,
the ...
Typically these are people who have not been born wealthy
and luxury is not a way of life yet – they are just
experimentin...
“The inner conflict between a middle class
mind set and the globally rich income level,
between conspicuous consumption an...
The “closet consumers” are represented in
Green
The Red and Green
sections are the target
markets of the Luxury
Brands in ...
The question here is, whether the Luxury
brands need to bring down the prices or extend the
brand set at lower price in or...
Let’s Find Out
Luxury products are perhaps one of the purest form
of branding because the brand and its image are
often key competitive a...
Enduring Style and authenticity
are often critical to justifying a
sometimes highly extravagant
price.
According to BMW Group India President:
Phillip von Sahr
Challenges luxury players face in India is making the
brand known...
Let’s take an example
of Multinational Luxury
Brand..
Louis Vuitton
A French fashion house founded in 1854 by
Louis Vuitton.
Ranging from luxury trunks and leather goods to
ready-to-wear, sh...
In 2003, LV launched its first
official store in New Delhi, India.
The target market:
Rich Businessman
The Royals
CEO’s
Ce...
NEWS REPORT TELLS ABOUT THE KEY
GROWTH MARKETS IN INDIA
Key growth drivers are the 150,000-
plus HNIs (high net worth indi...
How does
“Closet
Consumers”
make purchases
Closet Consumers "won't pick up a Louis Vuitton [bag]
because it's Louis Vuitton. They examine it and give a glance
to its...
Clever buyers, prefer the best quality with a reasonable price.
About two-thirds of India's population is below 30 years i...
So does this mean that Louis
Vuitton should drop down the
prices or extend the brand set at
lowered price in order to reac...
Louis Vuitton‘s continued success can be attributed to
consistently upholding its core values and remaining
loyal to its t...
Quality and Exclusivity.
Symbol of social status for them.
High reputed Brand symbolizing the
wealthy and elegant lifestyl...
A note describing some of the
“Indian Consumers of Luxury Brands”
While extending the brand has positive effects for the firm
as it can serve more people and simultaneously increase
its ma...
Brand dilution: Consumers no longer associate the
brand with a specific or highly similar set of products
and start thinki...
Alienate the Core Consumers base
and ultimately erode and dilute the
Louis Vuitton brand equity.
People may start thinking that the company has shifted
its focus towards the other segment and have lost the
interest in t...
“India could become an important luxury
market in the next decade. However, right
pricing is very important. A luxury bran...
Instead of extending the
brand, the company needs
to think about boosting
the sales of the brand…
1. Increasing the footfall to
their stores
2. Endorsing and Sponsorship
3. Opening outlets in Luxury Malls
4. Outlets in 5 star hotels.
5. High streets: high footfall
6. Delighting customers with gifts on
purchasing during the low season.
7. stores located in the country’s
most favourite Tourist Destinations.
8.
Appealing
more to
Young
Millionai
res
But
sometimes
Bad times pose difficult
challenges on the luxury
brands pricing.
`
Those who have successfully extended their
brands from vertically across a range of price
points are usually the most im...
Giorgio Armani
Giorgio Armani
Italian fashion house founded by Giorgio Armani which
designs, manufactures, distributes and retails haute couture,
ready-...
The Armani brand extended from the
most expensive to most accessible
In Tier 1 : Custom made couture products
Giorgio Arma...
In Tier 2: Young, modern, more affordable
styles
Emporio Armani
and
Armani Collezioni
Tier 3: More youthful and street-savy
translations of Armani Style
AJ | Armani Jeans
and
AX | Armani Exchange
Clear differentiation exists between these brands,
minimizing the potential for consumer confusion and
brand cannibalizati...
Market share of
Luxury Brands
SIMILARLY
BMW cannot launch a car in the compact
segment below 20 lakhs INR because the
company is associated with high pe...
The BMW’s lowest priced car in India is 1 series:
22 lakhs.
It maintains the luxury of the Parent brand and
does not dilut...
Conclusion
A brand is a name, term, sign, symbol, design or some
combination of these elements, intended to identify the
goods of one...
If we want to keep younger and closet consumers
buying and consuming good-quality luxury products
at affordable prices—and...
They can be made under the umbrella of the
original group, but the production and
distribution chains must be clearly sepa...
Companies with superior reputations must
offer good-quality branded luxury products
at competitive prices.
Any attempt to change the traditional way of
doing things could alter the Brand’s
perceived value in the eyes of both the
...
Created By: Dipanshu Sehjal, IIIT Allahabad
During an Internship under guidance of
Prof. Sameer Mathur
IIM Lucknow
www.IIM...
Preserve the luxury or extend the brand.
Preserve the luxury or extend the brand.
of 69

Preserve the luxury or extend the brand.

Published on: Mar 4, 2016
Published in: Marketing      
Source: www.slideshare.net


Transcripts - Preserve the luxury or extend the brand.

  • 1. Preserve the Luxury or Extend the Brand In context with Indian Market
  • 2. Indian Consumer Market
  • 3. Indian consumers are becoming increasingly demanding and knowledgeable. Urban as well as rural consumers know what they want, and are looking for products and avenues to fulfil their needs without compromising on quality. Today's Indian consumer has more expectations regarding - variety, availability of the latest products and location close to response.
  • 4. The opportunities -- and the challenges -- posed by the Indian market are enormous. The world's second most populous nation, India has already become its twelfth largest economy.
  • 5. India is a booming emerging market. Today, the demand for luxury brands is ever increasing and brand offering is continuously on the rise. The luxury market is expanding rapidly in India on the back of Economic deregulation, Fast GDP growth, Wealth (re)generation, Increasing per capita consumption, Growing young working population.
  • 6. Luxury Brand Segment in India
  • 7. The fast rising Indian Consumer Markets has attracted many Luxury brands from the worldwide to set up their business in India. India being the second-fastest growing economy is believed to be one of the most sought after market by the luxury brands. India's growing luxury market is set to exceed $14 billion-mark by 2015 boosted by a new class of wealthy termed as the 'closet customers' who have joined the traditionally rich contributing to higher luxe sales.
  • 8. From about $3.66 billion in 2007, the luxury market has more than doubled to $7.58 billion in 2013. According to industry experts, India could emerge as an important luxury market in the next decade but pricing will continue to play a key role in expanding the market.
  • 9. The Key Consumers
  • 10. The CII-IMRB report said luxury is no longer restricted to the rich & famous alone, the new age or 'closet consumers' who do not typically fit into the boardroom definition of luxury consumers are staking claims to luxury products, brands and services as well, but on their own terms. The past 10 years of economic growth has given rise to a new wealthy class in India —‘closet consumers’— who are a major force behind the country’s luxury market growth.
  • 11. Who are CLOSET Consumers
  • 12. Closet consumers are cost- conscious and seek “value” even when buying luxury products. And their definitions, symbols of luxury are often in variance with conventional ones.
  • 13. These are new generation entrepreneurs, senior corporate executives, farmers who have sold their land to developers , the BPO generation that lives with parents and has money to splurge.
  • 14. Typically these are people who have not been born wealthy and luxury is not a way of life yet – they are just experimenting with luxury. Despite their newfound riches, there is an inherent middle class mind set among this class, even as they can no longer be classified as middle class based on their income.
  • 15. “The inner conflict between a middle class mind set and the globally rich income level, between conspicuous consumption and a level of luxury is what called as the ‘closet consumer”
  • 16. The “closet consumers” are represented in Green The Red and Green sections are the target markets of the Luxury Brands in India. Projected Income distribution of the Indian Consumers in the upcoming years.
  • 17. The question here is, whether the Luxury brands need to bring down the prices or extend the brand set at lower price in order to attract more customers to make it more affordable and become capable of catering the larger segment of the target market.
  • 18. Let’s Find Out
  • 19. Luxury products are perhaps one of the purest form of branding because the brand and its image are often key competitive advantages that create enormous value and wealth for organizations. Luxury for many have become more about personal pleasure and self-expression. The common denominators of luxury brands are quality and uniqueness.
  • 20. Enduring Style and authenticity are often critical to justifying a sometimes highly extravagant price.
  • 21. According to BMW Group India President: Phillip von Sahr Challenges luxury players face in India is making the brand known amongst its target customers. "For luxury companies, making brand familiar is the most important challenge. The next is to ensure that customer remains loyal to the brand”.
  • 22. Let’s take an example of Multinational Luxury Brand..
  • 23. Louis Vuitton
  • 24. A French fashion house founded in 1854 by Louis Vuitton. Ranging from luxury trunks and leather goods to ready-to-wear, shoes, watches, jewellery, accessories, sunglasses and books. LV is one of the world's leading international fashion houses.
  • 25. In 2003, LV launched its first official store in New Delhi, India. The target market: Rich Businessman The Royals CEO’s Celebrities NRI’s Closet Spenders
  • 26. NEWS REPORT TELLS ABOUT THE KEY GROWTH MARKETS IN INDIA Key growth drivers are the 150,000- plus HNIs (high net worth individuals) with a net worth of $600 billion-3.1 million households earning more than Rs.10 lakh in the top 10 cities (Mumbai, Delhi/NCR, Bangalore, Kolkata, Pune, Chandigarh, Hyderabad, Ludhiana, Chennai and Ahmedabad)
  • 27. How does “Closet Consumers” make purchases
  • 28. Closet Consumers "won't pick up a Louis Vuitton [bag] because it's Louis Vuitton. They examine it and give a glance to its worth. "The new Indian luxury buyer is more aware of brands. While he values and buys international luxury brand offerings, he also appreciates his Indian roots and culture.
  • 29. Clever buyers, prefer the best quality with a reasonable price. About two-thirds of India's population is below 30 years in age, which is a challenge for most brands as these are aspirational consumers, but may not have the money to buy.
  • 30. So does this mean that Louis Vuitton should drop down the prices or extend the brand set at lowered price in order to reach this segment ??
  • 31. Louis Vuitton‘s continued success can be attributed to consistently upholding its core values and remaining loyal to its travel-centric heritage. Core Consumers buy LV because it is more about personal pleasure and self-expression.
  • 32. Quality and Exclusivity. Symbol of social status for them. High reputed Brand symbolizing the wealthy and elegant lifestyle.
  • 33. A note describing some of the “Indian Consumers of Luxury Brands”
  • 34. While extending the brand has positive effects for the firm as it can serve more people and simultaneously increase its market share which in turn may help the firm to survive the economic downturn. But it also have negative effects
  • 35. Brand dilution: Consumers no longer associate the brand with a specific or highly similar set of products and start thinking less of the brand.
  • 36. Alienate the Core Consumers base and ultimately erode and dilute the Louis Vuitton brand equity.
  • 37. People may start thinking that the company has shifted its focus towards the other segment and have lost the interest in the original segment of products. Lower priced brand segment might cannibalize the sales of the original Louis Vuitton product segment (its core segment).
  • 38. “India could become an important luxury market in the next decade. However, right pricing is very important. A luxury brand cannot bring down prices just to attract more customers, to make it more affordable. Premium pricing is essential to ensure the brand exclusivity" . Canali, Generale Manager, Stefano Canali said in the CII-ET Dialogue on Luxury.
  • 39. Instead of extending the brand, the company needs to think about boosting the sales of the brand…
  • 40. 1. Increasing the footfall to their stores
  • 41. 2. Endorsing and Sponsorship
  • 42. 3. Opening outlets in Luxury Malls
  • 43. 4. Outlets in 5 star hotels.
  • 44. 5. High streets: high footfall
  • 45. 6. Delighting customers with gifts on purchasing during the low season.
  • 46. 7. stores located in the country’s most favourite Tourist Destinations.
  • 47. 8. Appealing more to Young Millionai res
  • 48. But sometimes
  • 49. Bad times pose difficult challenges on the luxury brands pricing.
  • 50. ` Those who have successfully extended their brands from vertically across a range of price points are usually the most immune to economic downturns. LIKE…
  • 51. Giorgio Armani Giorgio Armani
  • 52. Italian fashion house founded by Giorgio Armani which designs, manufactures, distributes and retails haute couture, ready-to-wear, leather goods, shoes, watches, jewellery, accessories, eyewear, cosmetics and home interiors. Armani is the fastest growing fashion brand. In India, Genesis Luxury Fashion Pvt Ltd. Markets brands ARMANI along with many other luxury brands.
  • 53. The Armani brand extended from the most expensive to most accessible In Tier 1 : Custom made couture products Giorgio Armani Prive and Giorgio Armani
  • 54. In Tier 2: Young, modern, more affordable styles Emporio Armani and Armani Collezioni
  • 55. Tier 3: More youthful and street-savy translations of Armani Style AJ | Armani Jeans and AX | Armani Exchange
  • 56. Clear differentiation exists between these brands, minimizing the potential for consumer confusion and brand cannibalization. Each also lives up to the core promise of the parent brand, reducing chances of hurting the parent’s image.
  • 57. Market share of Luxury Brands
  • 58. SIMILARLY BMW cannot launch a car in the compact segment below 20 lakhs INR because the company is associated with high performance and luxury segment in spite of a tremendous market opportunities in the lower priced segment.
  • 59. The BMW’s lowest priced car in India is 1 series: 22 lakhs. It maintains the luxury of the Parent brand and does not dilute the Brand’s image.
  • 60. Conclusion
  • 61. A brand is a name, term, sign, symbol, design or some combination of these elements, intended to identify the goods of one seller and to differentiate them from those of competitors. Brands are valuable intangible assets that offer a number of benefits to customers.
  • 62. If we want to keep younger and closet consumers buying and consuming good-quality luxury products at affordable prices—and attract future high-quality- luxury consumers as well—then companies like LV, with superior reputations, must make good-quality branded products available at competitive prices.
  • 63. They can be made under the umbrella of the original group, but the production and distribution chains must be clearly separated. One option is to create two discrete business units within the group.
  • 64. Companies with superior reputations must offer good-quality branded luxury products at competitive prices.
  • 65. Any attempt to change the traditional way of doing things could alter the Brand’s perceived value in the eyes of both the industry and the consumers.
  • 66. Created By: Dipanshu Sehjal, IIIT Allahabad During an Internship under guidance of Prof. Sameer Mathur IIM Lucknow www.IIMInternship.com

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