There was a time when to talk of luxury brands in India was an abomination. Here we had people dying of starvation, the argument went, and luxury was the last thing on anyone’s mind. Then, in the last couple of years, something changed. Not only did we become open to the idea of luxury, we seemed to hanker for it as if somehow it was our due and we were not the country we imagined ourselves to be without the finest luxury goods in the world.
The media was vigilant in spotting the smallest signs that luxury was finally making its presence felt, with various colour supplements in newspapers enthusiastically heralding its imminent arrival. The media bristled when the Tatas were deemed unworthy by a few in the West of owning a luxury brand of hotels, seeing it as a slur on India. India, it seemed, needed to quickly embrace luxury brands not because consumers wanted them but because the country’s image demanded it.
Today, given the economic environment that surrounds us, the enthusiasm seems to be tempered and we are back to asking if luxury brands are relevant to the Indian context. At a time like this, it is easy to argue that luxury brands in India are likely to struggle, given that the overall mood is as downbeat as it is. It is an irony of our times that so far, the rich have been affected most by this downturn as it principally involves the virtual economy—that part of the economy where money makes money. Most of mainstream India has so far been excluded from this hallowed world.
Wealth-generating sectors such as real estate and finance have been the worst hit, and hence luxury goods, which are otherwise immune to minor financial vicissitudes, might well feel the icy draughts of a long hard winter.
The larger, and infinitely more interesting, questions are: Is luxury relevant to India at all, regardless of the current downturn? Is the evolutionist assumption that India will develop into a large market for luxury, as indeed have other markets that have seen affluence, simply because it is the sequence of events that progress reveals itself through? Is it only a matter of time before we start embracing Escada and fretting over the differences between Fendi and Hermes?
Illustration: Jayachandran / Mint
Luxury has been slow to take root in India. While there are some success stories, these are still marginal in terms of numbers. One possible reason is that a lot of consumers at the top end prefer to do their shopping outside India. With most other things now being available locally, luxury is one area where the idea of buying from the source is an appealing one. Popping across to London to “pick up a few things” is a motivation that is hard to beat.
There is, perhaps, a more fundamental reason. Steeped as we are in a background of scarcity, the idea of consumption is at its heart a functional one to the Indian buyer. The instinct of calibrating one’s expenses to within earshot of our needs is a difficult one to overcome. Change is easier to accept in some arenas as against some others. With growing affluence, we find it relatively easy to spend more on things that make us experience a better life—travel, entertainment and eating out are sectors where it is easier to upgrade to the finer things in life. We also understand status goods; luxury for us is a linear scale that needs to be ascended. A bigger car, a penthouse, a Montblanc pen—these are easy symbols to grasp and flaunt for they represent a universal currency of hierarchy.
Hierarchy is well understood by the Indian. We are used to pecking orders in everything in our life — we can rank schools, colleges, VIPs and VVIPs with an astonishing amount of precision.
Where the Indian consumer struggles is when luxury becomes horizontally as well as vertically arrayed. As long as brands represent rungs of a single ladder, with clarity about which brand is higher than the other, we find that it meets the need for class signalling. So, there is no problem in aspiring for a Mercedes because it comes with a clear statement of its relative position. But what is one to make of an Aston Martin? Luxury as a sign of hierarchy fits in with a society that is intricately layered. It is when luxury becomes a mark of taste that the disconnect begins. The Indian consumer understands the symbolic power of objects that are culture-neutral but does not respond as well to those that are embedded in an alien cultural system.
Unlike the West, where the responsibility of becoming somebody rests entirely on an individual, in India everybody is born somebody. The child comes into a world with a past; he “belongs” somewhere and derives his identity primarily from this source. The need to construct oneself from scratch with the help of consumption, the need to assemble oneself bit by bit, is not as pronounced in India as it is in the West. The role that consumption plays in our lives is not as central as it is in more individual-centred cultures. Consumption mediates status, how one appears to others in terms of social rank, but is not that critical in constructing individuality, how one defines oneself. Of course, this is changing but, perhaps, a tad slowly.
As a result, luxury faces a language problem in India. We simply do not understand the nuances of its vocabulary and often stumble even on its grammar. We do not have familiarity with the cultural signposts that are the basis of knowing what to value and how much, because luxury operates within the framework of a larger cultural system, the meaning of which is known to all. In India, we are far too comfortable with our own cultural markers to find the need to go through the elaborate education that we would need to go through in order to grasp the fine distinctions between one luxury brand and another. Our own cultural system is too well developed to need a completely new one.
That gives India a certain amount of immunity from the powerful influence that the idea of luxury has over much of the developed world. Being grounded in scarcity and having a stable source of identity make the Indian respond to luxury with greater caution.
This will change as a new generation of Indians used to affluence begin to emerge in larger numbers. But even then, it is not necessary that luxury follows the trajectory of development it did in the West. Will the road to a more sustainable idea of luxury, one which is not as deeply grounded in excess and waste, begin in India? I am not sure about that, but whatever road is chosen by the Indian consumer, we will reach a new, unknown destination.
Santosh Desai is CEO, Future Brands
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