Synopsis on Indian Luxury Market
Essay Preview: Synopsis on Indian Luxury Market
Report this essay
Synopsis On Indian Luxury Market Submitted by: Himanshu yadav DGLLBM150472 Table of ContentsOverview of the Indian Luxury Market Literature Review Concept of luxury products Classical theory Prototype theory Exemplar theory Classification of luxury products Bibliography Overview of the Indian Luxury MarketIndia is a fast becoming one of the leading market for luxury products in the world. This market is experiencing growth of CAGR of about eighteen percent and is predicted to reach fifteen million USD by 2016 (Datamonitor, 2015). This is owing to a fast rising upper middle income group especially in the urban cities. It is due to this that there is a rising number of high net worth people who are having a good demand for luxury brands. Thus, it is showing a good potential market for the luxury brands. There are several global players who are making efforts to enhance their market share in the luxury market of India. But, they are being confronted with different kinds of challenges such as excessive selling of counterfeit products and presence of less talent for the marketing of the luxury products. [pic 1]The luxury market in India has grown at twenty three percent since 2006. The market of luxury products like electronics, jewellery, watches, and apparels, etc. have grown at thirty percent to reach a market size of about USD 14.72 billion by the end of 2015 (Market of Luxury Products , 2015). There is an unprecedented growth in the various categories ranging from fashion to hotels, to automobiles and fine dining, etc.It is especially after the recovery of the global economy that the global luxury industry is also experiencing a growth. But, this growth has been disproportionate as it is mainly expanding in the Asian Pacific region. India is emerging as a hub of luxury goods brand and is being projected as one of the next big market for luxury products after China in terms of its consumption. This is primarily due to rise in the number of millionaires and the rising disposable income of people in India (Market of Luxury Products , 2015). Literature ReviewConcept of luxury productsThe term luxury products refers to all such products which possess more than the necessary and the normal attributes compared to the other products of their category, which include their relatively high level of price, rarity, aesthetics, extra-ordinariness, and symbolic implication (Phau & Prendergast, 2000). Luxury brands are considered as images which are created in the minds of the customers which includes associations about the high level of price, quality, aesthetics, rarity, uniqueness and a high degree of non-functional associations (Kapferer, 2012).
Various products and brands can be classified into luxury or non-luxury division as per the similarity of their attributes (Wiedmann, Hennigs, & Siebels, 2007). There are various theories for the categorization of products into luxury or non-luxury category. Some of the prime theories are like:Classical theory As per the classical theory there are certain prime assumptions based on which the classification is being done. It comprises of the critical attributes of the object by which it can be put in a specific category (Vigneron & Johnson, 2004). Every object features of a particular attributes by which it becomes easy to classify like there are certain unique or rare features of a product by which they can be categorized into luxury products. However, these categorizations are instable and tend to change with the passage of time and also in the category of product for which the classification is being done. Prototype theoryAs per this theory there are assumptions like the typical attributes which show the knowledge concerning a category that is being represented through an abstract prototype like specific features which are dependent on the experience regarding the concrete representatives of a category (Bearden & Etzel, 1982). The typical attributes are having a good possibility of their occurrence within a particular class of objects but are not essentially being seen in every product of a division. It also highlights that there is a continuous updating based on which the products are to be categorized into luxury products (Yeoman & McMahon-Beattie, 2006). This theory also suggests that the objects of a particular category tend to be different in the degree which qualifies them as the representatives of the specific category. It implies that the luxuries are not the same in all categories of products and therefore, they tend to vary in their extent of affiliation or brands. Exemplar theoryThis theory is considered to be a more realistic approach as it considers the use of particular exemplars like Rolls Royce in automobiles as the representation of luxury. Any new product is being classified into a specific category by making comparison to the existing exemplars. It is based on this that the new object is being assigned to the categories to whose exemplars it is depicting the maximum similarity (Csaba, 2008). Therefore, this theory is considered to be more flexible approach based on which the products can be easily categorized into either luxury or non-luxury divisions. But, the prototype theory is regarded to be one of the common theory for the categorization of products which is being supported by the exemplar theory. There are certain requirements of specific attributes by which the products can be classified into the category of luxury products. For instance, Czellar, Laurent and Dubois have identified certain attributes for a product to be considered as luxury (Dubois, Czellar, & Laurent, 2005). These are like:Excellent quality – it is generally believed that the luxury products are having excellent quality which is a major attraction for their buyers. Very high price – luxury products are having very high pricing which makes them stand out from their non-luxury options. Scarcity and uniqueness – luxury is a concept that is related to scarcity and this scarcity is linked with the perceived exceptional quality and pricing that is linked to luxury products. Aesthetics and polysensuality – luxury comprise of a strong aesthetic appeal that is being preferred by its customers like rare pieces of art or craftsmanship, etc. Ancestral heritage and personal history – luxury is also linked to ancestral heritage and therefore the luxury products and services are required to have a long past and their elaboration procedures along with their consumption that are required to respect certain traditions. Superfluousness – luxury also is associated to perceived superfluousness as they are not felt to be essential for survival. It is due to this that certain researchers and customers are confronting luxuries and necessities (Dubois, Czellar, & Laurent, 2005). Classification of luxury productsLuxury products are being classified into various categories in the following manner:Personal versus impersonal products – it comprises of the products where luxury products are being used for the purpose of managing self-image and are making strong tie-ups with such products (Kapferer J. N., 1996). On the other hand there are products that are like the garden furnishing or the bathroom equipment etc. that fall in the category of impersonal luxury products. Public or privately consumed products – public consumed products are like cars, etc. that are visible to others. On the other hand the privately consumed products are like kitchen appliances, etc. which are not seen by lot of people. Accessible or the exceptional luxury products – the prime attributes or products by which they can be categorized into accessible and exceptional luxury products is on the basis of inter-categorical comparison of their selling price which is also having an influence on their level of diffusion and the repurchased rate (Kemp, 1998). For instance products like expensive perfumes are the accessible luxury products but products such as private jets are exceptional luxury products which can be afforded by only few people, however these are inaccessible to most people. Most of the luxury products are being categorized generally in various kinds of products such as leather, fashion, and automobiles, etc. There are various local and international brands that are operating with their unique product offers in different categories. For instance, in fashion there are various companies which are operating in the Indian luxury products market such as Zara Fashion, Louis Vuitton, and Armani, etc.