Premium electronics are a small part of the consumer electronics business in a cost-conscious country such as India. Naveen Rao, managing director of Navshiv Retail Pvt. Ltd, which distributes high-end brands such as Loewe, Bang & Olufsen (B&O), Mobiado, People of Lava Sweden and Audio Pro throughout India, shares his views on the luxury electronics market in India, and why companies need to focus on mid-range items to build awareness in the market right now. Edited excerpts:
What is your view of the luxury market in India?
The market is small but growing. A new generation is more willing to spend money on audio-visual equipment—the money might still be spent by their CEO parents, but the children come with all the research done, aware of what they want and how they want to connect it together.
It also means that luxury distribution should cover a wide spectrum of products, where you have different brands at different prices. You can’t expect people who are used to spending on something like Sony to instantly jump to Bang & Olufsen.
You mentioned CEOs and their children. Is that the typical customer? What’s the average amount that you see customers spend on speakers?
Most often, you’ll see around Rs.5-10 lakh from a single customer. But the average is different, because now and then you’ll have the high-value customer who wants high-value items, many times more expensive. Or there will be a hotel which wants 20 TVs.
Typically, you’ll see someone around 18 select things, and then the parents buy. If the parents are well-travelled, and interested in audio, they might come themselves. Now more young people, around 30-35, come, young businessmen who want quality and value.
You sell to businesses and to consumers—what’s the focus and why are you catering to both groups?
We sell both to businesses and direct to the consumer because in India there isn’t really a strong consumer market for luxury electronics yet—it’s changing and it’s growing, but it is going to take time. It’s a fairly underdeveloped area—you will see the market for some brands like Louis Vuitton, but not for all of them. So you need to sell to businesses too.
B&O was small in India earlier, but today everyone knows them. There’s a huge gap between mass-market brands like Sony and luxury brands like B&O and I think that’s what the customers want. We’re trying to give, to grow the market.
So do you prefer working with consumers or businesses?
With businesses, it can be a very slow process, and they are often much more demanding about the products they want, and the prices. On the other hand, customers can have no clear idea about what they want, and change their mind often. Sometimes, you get strange requests.
We’ve had people who wanted TVs which were bigger than their rooms. We would lever it into the house with a crane, and remove walls to make it fit. Then they asked us to redesign the wall. One customer wanted to buy a dozen TVs, but only if we gold-plated them. Another took six months to make a decision, but then said, okay, I’ll buy the set, but only if you can install it tonight. We took a team and got it running by 1am.
There was even one man who wanted to gift a set-up, which would take two weeks to import. So he told us—give me the boxes, I will gift that, and send the speakers later!