With traditionally conservative markets like Surat, Chennai and Kolkata now emerging as the cities for luxury labels more and more international luxury brands are looking to make their presence in these places. These cities have opened a wealth of opportunity for brands like Louis Vuitton, Armani and Burberry. As Sanjay Kapoor, MD, Genesis Luxury puts it there is a nascent market waiting to explode. “We think the time has come." Genesis Luxury, markets brands such as Armani, Burberry and Canali in India.
Recently, Louis Vuitton opened a store in Chennai. Chennai is becoming big in terms of consumers’ spending on luxury and lifestyle, feels Rajmohan Krishnan, Executive VP (wealth management) for north and south, Kotak Mahindra Bank. People have new money and there is a new generation of entrepreneurs who want to splurge. Moreover, the mounting connection between the north and south is impacting spending habits of people in south India.
Louis Vuitton also plans to share space in the seven lakh sq. ft. mall built by businessman Sanjiv Goenka in Kolkata. Although the mall is under-construction and expects to open by next year, it has already leased out 50,000 sq. ft. of space to luxury brands like Bottega Veneta, Bally, Burberry, Rolex, Porsche Design and Jimmy Choo. Pankaj Renjhen, MD, retail services, at property consultant Jones Lang LaSalle feels that the mall will not only attract shoppers from the entire east India, but also from Bangladesh. Apart from this, Louis Vuitton also plans to have its presence in cities like Hyderabad, Noida, Gurgaon and Pune. Gucci too is exploring possibilities of opening a store in Kolkata.
In Surat, Genesis has taken up space for half a dozen stores at a luxury mall being built by Virtuous Retail, a retail real estate asset platform sponsored by the Xander Group Inc. It is also looking for space in Chandigarh, Ludhiana and Jaipur. It is expected that in the next six months, more than half a dozen international luxury brands including Armani, Burberry, Tumi and Crabtree & Evelyn would enter Surat.
According to a report, boomtowns like Surat, Jaipur, Lucknow, Nagpur, Bhopal, Coimbatore and Kanpur have seen the most striking shift in income distribution. The number of high-income households in these cities is growing at around 20 per cent a year, against 13.7 per cent in the mega cities and boomtown households on average spend 12.7 per cent more than mega cities on clothing.
Anupam Yog, MD, Virtuous Retail says Surat is one of the top 10 markets on the company’s radar and has massive consumption potential with 73 per cent of the five million population in Surat below 35 years, and 32 per cent of the households having an annual income of more than 3 lakh. No wonder, newly opened luxury hotel in the city, The Leela Palace, has set aside around 8,000 sq. ft. of retail space for luxury retail brands, with a focus on jewelry and watches.