Tap India’s Richie Rich through the trade



Year 2007 will be remembered as the year of billionaire Indian businessmen making their mark in the global arena. Now, India is the home of about 54 billionaires as on date (as per Forbes.com), whose collective networth has doubled compared to last year and has touched USD 351 billion.

Sunil Karer

Year 2007 will be remembered as the year of billionaire Indian businessmen making their mark in the global arena. Now, India is the home of about 54 billionaires as on date (as per Forbes.com), whose collective networth has doubled compared to last year and has touched USD 351 billion. This is second highest number in Asia after China. Spreading affluence may have been the dominant theme for Year 2007 as economic growth created an unprecedented number of millionaires and fuelled new levels of consumer spend. 2007 was a year when India fast forwarded to a new level of conspicuous consumption, driven by a wider-based economy and a stock market that provided record returns.

March of luxury

The affluence has certainly led to an increased demand for luxury products including watches. Global luxury brands set up shop in India in unprecedented numbers making brands the story of the year. Industry estimates say that some 250 international luxury brands are eyeing the Indian market, worth Indian rupees 24 billion (USD 0.6 milliards) already and growing at 30-32%. There are 1.6 million households in India spending over Indian rupees 400,000 (USD 11’000) a year on jewellery, clothing, digital accessories, watches and cosmetics and skin care. These households will treble to three million in the next five years, says a study on luxury goods spending. The study presents a four-deck Indian Affluent pyramid : one million luxury households, six to seven million very affluent, nine to 10 million mid-affluent, and 14 to 15 million upper middle class. The World Wealth Report by Merrill Lynch put the number of millionaires in India at 93,000, up from 82,000 in 2005-06, and said that India recorded the world’s second fastest growth at 19.3 per cent in the number of high networth individuals. That translates into a potential market of USD 16 billion, with the number of very affluent households growing by 12-15%.

Trade rules the roost

Areas of rapid change and those where very little has changed for centuries merely brought out the contrast and contradictions in much sharper relief. As far as the horological business is concerned, there is one element that has remained constant. The challenge for international watch marketers is to translate the “ability to pay” factor into “willingness to pay” by appealing to different niche audiences in a highly fragmented market. There is a need to guide the consumer up the value chain – where the decision to purchase a watch brand is a cumulative of economic considerations, functional attributes and emotional aspirations. In India, the 10,000 strong horological trade rules the roost ! In the Top 30 cities of the country, the horological dealers and distributors are well cued on to the dynamics of the market. They are directly in touch with their retailers as well as their customers. The trade maintains an exhaustive database of their customers and knows their preferences quite well. The trade also keeps its ears to the ground in an attempt to connect to those consumers, who want indulge.

Even though the Indian consumer mindsets have changed considerably, what has remained a ‘constant’ in an increasingly ‘variable’ situation is the fact that the trade knows the Indian consumer, who is searching for offerings that suit his/her aspirations, budget and lifestyle. The trade knows how to reach out to the consumer at different locations or times of his/her daily routine. The trade fulfils the marketers’ needs to ’connect’ with consumers locally. The trade is aligned to the emphasis of shifting from ’deliveries’ of exposures to setting up, managing and measuring ’consumer meetings’. Trade is the answer as sophisticated marketers are increasingly supplementing the ’see and hear’ approach with a strong ’touch and feel’ dimension. The trade can take the lead in a range of marketing and media activities in a specified market, which delivers (to consumers) a brand experience with multiple touch points and much deeper levels of involvement.

Trade can play a significant role

The trade can play a significant role in realigning the consumer mindset towards the adoption of products that are available in a complete feel-good complete package – assured quality, guaranty or warranty, value additions, after-sales and most importantly long lasting relationships.

The trade can empower consumers to get a first hand insight to the brand. This is particularly relevant in the case of foreign brands that can directly communicate their glorious history ; establish an aura comprising of their features, advantages and benefits of their globally renowned brands. This will also help the Indian consumer to take a plunge and go beyond the deep-rooted perceptions that have been embedded in their minds. It is time to drive home the fact that watches provide much more than the functional attributes ; that the real thing is better than a million counterfeit products ; buying and wearing a recognized brand speaks volumes about one’s personality so on and so forth.

Every industry sector has its own annual carnival and it is time the Indian horological industry had one of its own. The atmosphere in India is conducive for organising an international trade event that would act as a catalyst for increased interaction and business development. As India shines and rises, it’s the right time to enrol the trade and showcase the latest offerings ; forge the requisite alliances ; increase distribution channels ; communicate effectively and orchestrate mega promotions. ■

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