Luxury's apples and oranges a bad cocktail

International luxury brands always make the mistake of having a so-called overall “Asia Strategy”, which primarily involves two countries that are very different. India and China have historically been very diverse in demonstrating their opulence and even today, they represent very different categories of luxury brand consumers. Let me elaborate with a bit of historical perspective. 

Imagine a time when 20% of global sales of Rolls Royce used to come from India. During the early 1900s, the love Indian royalty had for branded luxury reached its pinnacle. Some examples of this are: 

In 1926, the Maharaja of Patiala commissioned Cartier to remodel his crown jewels, which included a 234.69-carat De Beers diamond. The result was a breathtaking Patiala necklace adorned with 2,930 diamonds weighing 962.25 carats. 

In 1928, the Maharaja of Jammu and Kashmir placed orders for 30 custom-made trunks from Louis Vuitton over a period of six months. 

A certain Nizam had procured 50 Harley Davidsons for his postmen to deliver his messages.

So India has a rich legacy of using luxury since the inception of these international brands, unlike China. The prosperous community, including the royalty in China, have been closed and heavily dependent on exquisite local products. The pride of “made in China” to the wealthy locals was a Great Wall that barred the entry of foreign luxury brands. 

In India, the scenario took a 180-degree turn post-Independence and anything remotely opulent was frowned upon. It’s only in the past few decades that there has been a shift, and the 'New Maharajas' -- industrialists, entrepreneurs, professionals and the rural rich -- started blatantly adoring and flaunting all things luxurious. 

Another very strong category of luxury consumers in India is the GIMC or the Great Indian Middle Class. The monogrammed Louis Vuitton products might be reaching a New Maharaja’s household time and again, but they also reach hundreds of households in the great aspiring middle class for the first time.

However, the Chinese market is not dominated by either of these above categories. The new-found growth in the luxury sector is fuelled only by the new, young, upper-middle class with a tendency to spend rather than save. They are the new-generation, first-time customers for luxury products. The ‘New Maharajas’ in China are still averse to ‘foreign’ luxury brands; the middle class is rising as a consumer but has not been able to make a mark yet in the toplines of these companies.

In spite of these marked differences, international luxury brands prefer to have a common overall strategy for consumers in India and China. This a strategically wrong. 

Their approach is very ad-hoc and clearly lacks a comprehensive and cohesive strategy. For example, you will suddenly see a slew of products launched to commemorate the Chinese New Year. Similar efforts will be made to cash in on celebrations like Diwali in India. There have been sporadic efforts, too, like Hermes deciding to suddenly come up with an expensive saree, out of the blue. 

If their strategic objective is to get a significant pie of the markets in China or India or for that matter anywhere in the globe, the first thing these brands need to do is to understand the intrinsic nature of the consumers. The best way to know that is by customer immersion, understanding their traditions with a historical perspective. 

Only when there is complete clarity on the evolution of the luxury consumer in a given geography, it becomes easy to put together a comprehensive strategy towards creating an aspiration for the brand and converting these buyers as loyal customers.

It’s time to for these luxury brands to go back to the drawing boards and wipe clean the overall ‘Asia Strategy’, and replace it with strategies for specific geographies with a deeper understanding of their traditions, culture and history. 

Let your quest for luxury continue. 

The writer is a luxury commentator and author of Dark Luxe and Decoding Luxe