India has more consumers for luxury goods than the adult population of several countries.
The Knowledge Company, an initiative of KSA Technopak, has produced India Luxury Trends 2006, a study on the sector that has over one million consumers in the segment, a number that is expected to treble by 2010.
This report aims to demystify India's highly sophisticated, intelligent, and complex luxury consumer.
According to the report, the immediate priorities for many consumers for luxury goods fall into the categories of housing, travel, education, higher-end automobiles, entertainment electronics, and other home lifestyle improvement products.
However, the report estimates that within 2-3 years the market for luxury goods will boom in the categories of men's clothing, women's jewellery, women's accessories - including handbags and footwear - watches, and gourmet food and wines.
Announcing the release of the report, The Knowledge Company Chairman, Mr Arvind Singhal, said: "India Luxury Trends 2006 is the first of a series of such reports from us. We expect luxury marketers in other countries to find this report extremely useful when looking to enter the Indian market.
"The Knowledge Company will also prepare reports on market insights, such as Consumer Outlook 2006 and Market Tracks, which will study resources in markets like China, West Asia, and Russia, to name a few."
India Luxury Trends 2006 divides consumers for luxury goods into four categories:
Luxuriented: Source of affluence is largely traditional and inherited wealth. Most importantly, they have high levels of exposure and awareness to world-class living.
New Rich: Adequate spending power. Acquiring orientation to luxury.
Getting There: Acquiring spending power. Spend mainly on high-end white goods, education of children, better housing, and larger automobiles.
Mid Affluents: Acquiring orientation to luxury, but unlikely to indulge beyond a limit.
The single most important reason for luxury retail not taking off in India is the lack of luxury retail environments. It is important to see how this segment will evolve in the future considering that existing retail formats in India are in 5-star hotels or as stand-alone stores.