The luxury market in India is niche, growing rapidly, but buys are made after much thought.

How is the luxury retail segment panning out in India? Are we still laggards?

_ Alfred P. Matthew, Kochi

Alfred, the real luxury segment at the top of the affordability market is only a niche today.

It is, however, a niche that is growing at a frenetic pace. Though India has an audience of high net worth individuals that compete with China in terms of equal size, the attitude to luxury buys in India is still conservative as compared to that of China. In China, a person will even beg and borrow to buy luxury. In India, even the ones that can afford luxury through their disposable incomes think thrice.

This has a good and bad dimension to it. The good dimension is the fact that the Indian luxury market is a solid market. It is a market that depends on solid affordability and incomes. It is not a credit-buy oriented market. The bad side of it is the fact that it is conservative in its attitude to luxury. And marketers hate conservative attitudes, as we know.

Indian brands are progressively adopting foreign brand names. Why? Does it work?

Sonal P. Mehta, Mumbai

Sonal, India is a nation that has been traditionally besotted with the foreign. The logic is simple. What you don't get easily, you tend to develop a passion for. What sounds distant attracts more. Never mind whether it is good or bad or ugly. This passion for the foreign brand name is typically all about a demand that is spurred on by a lack of access.

The second key point to remember is the heritage residue that successive sets of invaders and rulers left behind on India. The most recent was the influence left behind by the British. Indians fought hammer and tongs to get the British out, but the names and institutions they left behind still endure. So much so that we would want to run behind a Peter England ‘honest’ shirt rather than embrace a 'desi' Charagh Din!

The third point is that international-sounding names add aura and allure. At times you do not understand the brand name, but the mystique and aura about the name is enough to create excitement. Take Alpenliebe versus Rani candy. The mystique of the foreign name is such that it dictates purchase decision in an important manner. The foreign name is all about quality cues that are superior to the Indian name that is about “low quality”. Ouch!

If you land up at your corner grocer and find two brands of toilet soaps, which one would you buy on the count of quality-cue superiority: Le Sancy or Raja? Never mind that Le Sancy soap may have been made at a place close to Dharavi in Mumbai! Shakespeare was, therefore, wrong. What's in a name? Plenty. A name spells origin mystique, a name cues quality, a name spells aura and a name spells a lot more than meets the eye.

Indian companies run behind foreign names to attain quick status and quick aura. Bhopal boasts of a residential gated community called “British Park”. It achieves instant status and aura. Da Milano attracts eyeballs and even Bulchee sounds foreign never mind that it is a brand that is meant to exude the ownership of the Bulchandanis.

What’s the ‘gyan’ on advertising in movies?

_ Vasanthi Hari, Chennai

Vasanthi, movies offer pre-segmented audiences. Those who watch movies in a cinema theatre are enabled audiences. They are audiences willing to fork out as much as Rs 1,800 per couple per show (top end multiplex) or as little as Rs 200 per couple per show (bottom end theatre) if you include ticket prices, the mandatory snack in theatre, and the cost of commuting to and from the theatre. These are audiences who have entertainment money on hand to splurge. They are impatient audiences as well, who will not want to wait for the movie to reach their television sets 4-6 months down the line. These are, therefore, buying and decision-making audiences. Audiences on roller-skates. The benefits of advertising and appealing to such audiences are obvious. Cinema advertising provides for this.

Out here, in-film branding and overt advertising, both work. For audiences in the top niche, in-film branding works better though, by a whisker.

Harish Bijoor is a business strategy specialist and CEO, Harish Bijoor Consults Inc. askharishbijoor@gmail.com

(This article was published on August 30, 2012)
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