American Express Luxury Spend Analysis 2018 reveals that affluent Indians spent on High-end fashion, Jewelleryand Electronics
American
Express Luxury Spend Analysis 2018 reveals that affluent Indians spent on High-end
fashion, Jewelleryand Electronics
-
Inbound luxury spend increased from 29% in 2017 to 34% in 2018 with US
travellers contributing the most
-
Luxury
spends record steady growth, high-end fashion outshines Jewellery in 2018
Chennai, 18March
2019:From Kolkata
to Koramangala, affluent Indians are making high-end luxury purchases in
growing numbers. American
Express’ analysis of merchant spends at premium and luxurybrands across the
country gives an insight into the shifting trends of luxury spending in
India, and the emerging pockets of affluence beyond the three metros.
The
report covering transactions and spend volumes at over 600 merchants finds
jewellery, electronics, high-end fashion (apparel and accessories) and luxury
retailto be the top categories of engagement for Indian affluents. The analysis
observed a seasonality associated with luxury spending, as transactions spike
during the festive and year-end travel season from October to December.
Manoj Adlakha, CEO,American
Express India,said,“India’s luxury market continues to grow with consumer behavior
maturing in the last five years. While jewellery spending dominated the
category till 2013, we have seen other segments – including electronic and
high-end fashion grow in share, and even surpass jewellery spends in certain
markets. In fact, high-end fashion contributed 42% of total luxury spends in
2018. Being a leader in the premium payments space, we understand customers’
preferences and are best placed to provide deeper understanding of attitudes
and spend patterns amongst high-value segment.”
Manoj further elaborated on these insights, “Affluent
consumers have a clear idea of the lifestyle they want to lead and celebrate
the duality – and fusion – of global luxuries and indigenous Indian brands in
their lifestyles. Indian affluents are no longer apologetic about their love
for shopping. 46% of super-affluent customers that we polled separately stated
they “liked to buy luxury brands” and a third (31%) of affluent and emerging
affluents also articulated this preference for luxury brands. Interestingly,
there is little price-sensitivity in this category, as 50% of the
super-affluent asserted that price was not a consideration in their purchase
decision. 30% of affluent and emerging affluent respondents concurred with the
same.”
Chennai specific details
·
Going
beyond the three metro (Delhi, Mumbai and Bangalore) – Kolkata, Chennai, Pune
and Hyderabad, have emerged as new centres of luxury consumption
·
Chennai
witnessed a 65% rise in luxury spend from 2017 to 2018
·
Chennai
spends major portion on high-end fashion boutiques followed by Electronics in
2018
·
Interestingly
luxury spending in Chennai happens mostly on weekdays rather than weekend
Key Insights
Growth in
luxury spending beyond the three metros (Delhi, Mumbai and Bangalore) – Kolkata,
Chennai, Pune and Hyderabad, have emerged as new centres of luxury consumption
·
While
Chennai witnessed a 65% rise in luxury spend from 2017 to 2018, luxury spending
in Kolkata doubled from 2013 to 2018
·
33%
of Luxury spending is done on weekends – in Pune, weekends make up for 58% of
luxury spending
High-end
fashion and luxury retail dominate spends across the country but Delhi
continues to spend the most on jewellery
·
High-end
fashion contributed 42% of total spend in 2018
·
Highest
proportion of luxury spends on jewellery in Delhi - grew from 13% (2013) to 39%
(2018)
·
In
Bangalore, share of spend at luxury retail increased from 53% (2013) to 65% (2018)
·
In
Mumbai, share of spending on jewellery fell from 27% (2013) to 23% (2018),
while luxury retail gained share from 36% to 44%
·
Electronics
is the category leader for Electronic City Hyderabad, with spends-share growing
from 16% (2013) to 52% (2018)
Other
emerging hubs of luxury
·
In cities
such as Chandigarh, Ahmedabad,Jaipur and Udaipur, luxury retail spend share
increased from 9% to 59% between 2013-2018
·
Growth in
luxury spend in these cities is 30x compared to Category A cities (2013 vs
2018)
Inbound
travellers contributing to Indian luxury market growth
·
34% of
luxury spending by inbound travelers
·
52% of
inbound luxury spending in India from US travelers
·
Inbound
spend has gone up from 29% in 2017 to 34% in 2018
Highlighting
the opportunity for
merchants, Manoj added,“With nearly 70% of luxury
spending in India contributed at top 15% of merchants, there is a huge
opportunity for retailers and local high-end merchants to understand customer
demand and preferences, and tap into their aspirations. We work closely with
our merchant partners to create exclusive promotions that deliver great value
both to our Cardmembers and merchants. For example, last year we entered a
partnership to offer flat savings on full-price merchandise at nearly 20
high-end fashion labels, exclusively for our Centurion and Platinum
Cardmembers. We will continue to invest in such partnerships to fuel category
and partner growth.”
These
findings are in line with industry reports. According to BCG data, spending in
smaller cities is rising by nearly 14% a year, and by 12% a year in India’s
biggest cities, bringing with it a desire for faster gratification - to
experience new things, live more premium lifestyles and buy international
brands.
About American Express
American
Express is a globally integrated payments company, providing customers with
access to products, insights and experiences that enrich lives and build
business success. Learn more atamericanexpress.com and connect with us onfacebook.com/americanexpress, instagram.com/americanexpress, linkedin.com/company/american-express, twitter.com/americanexpress, and youtube.com/americanexpress.
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