Hamilton South | Young affluent Indians redefine luxury

Mumbai: Hamilton South is founding partner of marketing and communications firm HL Group and oversees corporate advisory services to global consumer products and luxury lifestyle brands such as Ralph Lauren, Sotheby’s and the Starwood Capital Group. He has also been editor-at-large of Vanity Fair magazine. His experience with diverse media platforms gives him insights into both sides—the demand and supply—of the luxury market. An Indophile with a keen insight into Indian cultural influences, South explains what the future holds for brands in the country. Edited excerpts:

What, according to you, are the most exciting trends for the media and the luxury segments in 2012?

The media business globally is fracturing. I think that as mobile technology moves into the forefront, more and more brands are required to become more adept at storytelling. Having worked in media and now working on the brand side, it is the perfect time to be creative and to explore new possibilities. It is a great time for change and there are a number of new platforms that I need to be able to talk to clients about. That is probably in detail the most exciting thing happening around now.

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Hamilton South says Indians are creating their own definitions of luxury and that luxury brands need to embrace social media to reach out to young customers.

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It’s something we’ve heard you say often before, that brands need to be about the storytelling.

I think that if you look at most great successful brands you will find that it is a ...a good product , but really what makes a great brand is the ability to tell a story across geographies and across cultures. In order for a company name or brand to rise to the level of adjectives, it needs to be able to tell that story.

With the advent of the digital age, and a lot of brand building having moved beyond print, how do you think brands need to change and grow to effectively reach out?

There are a couple of different ways to do that. In print, there was always a very, very large requirement that you understood the notions of photography. Still photography was always the primary medium for a brand to storytell....it was a great medium, but it was a very flat medium. The requirement of language is to get something across. I think with the (advent of the) Internet and the entire digital space, it now forces brands to develop their ability to tell stories using video. I think you now have to be able to tell your brand in both video stories and verbal stories.

Is luxury at all looking to exploit the viral nature of social media?

I think three years ago you heard every luxury brand talk about how the Internet was not an “appropriate place” for luxury and I think that that’s just fundamentally stupid. The reality is that what matters most right now over the long haul is the younger consumer, who over the next 20 to 30 years is going to be engaging with the mass brands and the luxury brands. And that consumer has largely grown up on a diet of digital. That is the expansion of the e-commerce space now in the luxury conversation, and makes it an absolute necessity.

The other thing is it’s no different than 30 years ago, when people were talking about television replacing the radio. I certainly don’t think that any medium ever goes away. I just think that at certain periods of time there will be new mediums. That is why I focus on storytelling. No matter how advanced, all of these, Twitter, Pinterest, Facebook, they are all just distribution mediums. And distribution mediums are all essentially worthless unless you have a good story to tell.

With so much of what was once considered aspirational coming within the reach of a large mass of the market, what do luxury brands have to do in order to retain its edge of being “luxury”?

That is such a complex question and I think that the definition of anything changes over time. The definition of luxury is one that is constantly changing. If you look at luxury three years ago it was driven by scarcity of products, aspirational pricing. The need for the consumer to feel that they had to stretch to engage and I am not necessarily sure that that is the definition of luxury over the next five years. I certainly think that in the Indian market a lot of the younger, affluent people are very keen to figure out how value is part of a luxury product.

If India is truly in a phase where it is defining, or rather redefining luxury for itself, how do you see that definition changing in the near future?

India is either the largest or the second largest English speaking nation in the world, which gives luxury brands a very ripe opportunity. I’m a big believer that one of the key mistakes luxury brands make in terms of their global expansion is to base all their key decision making on that. But what denotes luxury to India is not at all what denotes luxury to Europe or America. I think customer here will comfortably change the definition of luxury. India as a market is far more advanced in terms of global technology than any other country in the world probably. And I think how mobile (technology) plays a part in all this will define it. And lastly, if you look at the landscape of Western brands it is littered with references to India, from Cartier to Hermes to Harry Winston. India from the design standpoint and the historical standpoint has supplied a tonne of inspiration for European luxury brands. And that is a “European notion” of luxury. I think the young, intelligent, well-educated, affluent Indian consumers will make their own very personalized decisions about what constitutes luxury in the future.

There is recent news that LVMH (Moet Hennessy Louis Vuitton SA) is investing in Fabindia Overseas Pvt. Ltd. Fabindia does not conventionally fit in with the European definition of luxury brands, but clearly, the people at LVMH are very smart and they see something there.

gayatri.j@livemint.com

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