Sanjay Kapoor, managing director, Genesis Luxury (part of Genesis Colors), cringes at the music being played at DLF Emporio mall, New Delhi, as we head from the Canali store to the Paul Smith outlet for window-shopping. He mutters something about needing to chat with the mall’s staff about the music selection.
At the Canali store (among Kapoor’s favourite menswear brands, naturally), he had waxed eloquent about the mall’s many plus points as a one-stop-spot for luxury retail. Clearly, however, the mall’s current deejay doesn’t pass muster with Kapoor’s staid banker-like sensibilities. By his own admission, he is “more of a classic dresser than experimental”, something that also reflects in his taste in music.
Trend mapper:Kapoor says Indian men spend more on luxury clothing brands; women are more priceconscious. Jayachandran/Mint
Kapoor asks the store manager at the Paul Smith store why the merchandiser has not ordered the blue moccasins he had suggested during a buying trip a few months ago. I am surprised he could have recommended “blue moccasins”. Perhaps the surprise reflects on my face and he clarifies with a grimace that he would never have bought those for himself because he never wears moccasins, and brown shoes with laces are more his style. But he thinks young clients who favour the Paul Smith brand might have liked the shoes.
“Don’t get me wrong. I am not saying being dressed in a conservative suit is the only mark of a well-dressed man. Take two examples—A.D. Singh, who runs Olive, is always nattily turned out whether he is wearing a hat or a white suit. On the other extreme is Nakul Anand, who runs ITC hotels. He dresses in a suit with a matching pocket square and a tie always. It doesn’t necessarily mean one style is better (than the other), but what you prefer. I lean more towards Nakul Anand’s style.”
Read that as being dressed in “a dark, preferably Canali suit”, a white shirt, perhaps a tie in a bright hue such as jewel green, and brown shoes.
It’s a little tough to imagine this 42-year-old man as a no-holds-barred risk-taker at 24. Kapoor pursued an MBA at the University of Rochester in the US. He gave up a well-paying job (“must have been around Rs7,000 per month in the early 1990s) at Citibank to set up a business without having a concrete business plan in place, or so he claims. “When I announced my decision to quit the bank, the response was ‘Are you nuts? Who quits Citibank in their early 20s?’” In his family, no one had ever dabbled in business, and they found this yearning to be an entrepreneur tough to comprehend.
But right at the start of his career, Kapoor was sure he did not want to work for someone else. “It is really a twin-edged sword,” he says. “When you spend time working in a job, you get experience and become secure. But the longer you stay in a job, the more your risk-taking abilities get blunt.”
Kapoor and his partner Jyoti Narula (whom he met at Citibank) had a vague notion that lots of people were exporting garments and it seemed like an easy enough business. “It was not rocket science. We just had to go to Europe, get orders and come back and send the garments.” But that was easier said than done. The duo did not get much business in the initial years—things began to change when they landed an order from a German shopping catalogue company for ties. “I think we had to make ties with red or black hearts.”
By 2000, the firm was using Satya Paul designs for its ties on a “fluid arrangement”. There was no marketing tie-up with the Satya Paul brand at this point. This arrangement was formalized in 2001 and the firm Genesis Colors was set up with a third partner, Puneet Nanda.
“In 2007, when Bottega Veneta’s Indian partner had exited, we decided to sign up with them. People said the brand was premature for the Indian market. The products don’t have large logos or the bling factor. But my gut feel was that it was the right brand to have in the Genesis Luxury portfolio. Two years later we are all happy with the deal,” says Kapoor, explaining how he thrives on risk.
Now the firm owns the Satya Paul brand, Samsaara, Bwitch and has distribution rights in India for global luxury brands such as Just Cavalli, Canali, Kenzo, Paul Smith, Jimmy Choo, Etro and Bottega Veneta. The Etro stores are scheduled to open in Delhi and Mumbai in July.
While the company’s marketing tie-up with German luxury brand Aigner ended last year, in October Genesis Colors picked up a 49% stake in a joint venture with British luxury goods retailer Burberry to open stores in India. The deal came after it sold a minority stake (at close to $17 million, or around Rs76.5 crore now) to private equity Henderson Equity Partners to raise money to fund expansion plans for its luxury portfolio. Burberry has stores in Delhi, Mumbai and the latest one in Hyderabad which opened earlier this month.
Except for Burberry and Just Cavalli, none of the other luxury brands in the company’s international brands portfolio sells fashionwear for women. Kapoor believes women’s luxury shopping in India traditionally revolves around jewellery and accessories such as bags and shoes—it is not focused on fashion clothing. “Men here predominantly spend more money on luxury clothing brands. For one, they control the purse strings.”
Between men and women shopping in the luxury space, Kapoor finds women much more sensitive to price and less loyal to brands. “An Indian woman who walks into a Bottega Veneta store at DLF (Emporio) will call her niece in London and check the price of that handbag or shoe she wants to pick. She is far more sensitized to pricing than an Indian man.” In comparison, he says, men are self-sufficient shoppers, don’t do too much window-shopping and are brand loyal. “But they do tend to be as fussy as women about great service and good fits,” says Kapoor, narrating the case of an irate male customer who “exploded” on a member of Canali’s staff for daring to suggest that the gentleman’s suit be picked up by his driver rather than be delivered by the Canali staff.
“No one is coming to buy a suit because they see value in spending Rs75,000 on it. A customer buys it not because this is a need-based purchase, but a want-based buy. Someone is plonking down some serious money to feel good about the experience (of buying) the product and that is what we have to constantly learn,” says Kapoor.
Ask him why the luxury market is taking so long to establish itself in India, whereas luxury retail sales haven’t seen a better year than 2009 in countries such as China, and he says: “Some people say the high-end luxury business is recession-proof and others say it is most hit during recession. Definitely the downturn affected people’s mindset in India. DLF Emporio opened in 2008, just as the news of the global downturn started trickling in. A few months later, the 26/11 attacks happened and after that the Satyam scam.
“India went through a solemn period for a while. We believe things started to turn around a little after the general election in May 2009. I know everyone says things got better in the last quarter of 2009, but we could see footfalls at the mall increase, retail sales (have been) slowly picking up since June 2009,” he says.
So did Genesis Colors suffer losses last year? The banker is on guard again. “We started retailing luxury brands in India two years (ago) only. I have no concrete figures to compare with.”
Apart from expanding in cities such as Chennai, and opening more Satya Paul and luxury retail outlets, I wonder which other luxury brands Kapoor is eyeing. “Ralph Lauren,” he says wistfully as we enter the Just Cavalli store.