One news that appeared on publications here last week has largely encouraged Indian luxury watch segment. Media reports suggest that Cartier, acknowledged for its finesse in luxury jewellery and watchmaking, is drawing a right business model to set up its second boutique in India. Cartier has already been associated with Indian royalty for its fine jewellery with one exclusive boutique in New Delhi.
The inclinations of the Indian consumers towards luxury watches have evolved over a period of time. Earlier, luxury was primarily interwoven with foreign trips and luxury watches were usually imported from Europe. As luxury watches entered Indian markets about a decade ago and the number of ‘new rich’ increased, the craze for display of wealth and social status have also increased. Luxury here has become all about flaunting the one’s wealth and consumers here have become extremely brand conscious.
Luxury watch companies making in-roads in India
According to an estimate, India’s watch market is estimated at INR 50,000,000,000 with the high-end and luxury time pieces accounting for about 20% of sales, or INR 10,000,000,000. Premium international brands are now trying to establish their presence here with time-pieces as high as INR 8,000,000 at their stores. Figures show that about 60,000 pieces of Swiss luxury watches are sold in India every year. Although, this number does not correspond to a big percentage of the Indian population, but what matters is that the luxury watch market is growing by 20% every year. Majority of luxury watch manufacturers have engaged Bollywood stars like Priyanka Chopra, Shah Rukh Khan etc. and cricketers like Sachin Tendulkar as their Brand Ambassadors.
Encouraged by India’s market potentials, Mr. Laurent Gaborit, Cartier’s Regional Managing Director for Middle East, India and Africa says,
"India is a very important market and we have Indian consumers throughout the world. Right now, however, the market in India is still at a primary stage. But given the population, wealth and success stories of the people here, we think there is a lot of potential.”
Cartier has been facing challenges like inappropriate retail environment and the Indian consumers’ tendency to invest in unbranded jewellery. "We have to be very modest in India as the right model to do business here is not easy to find," Gaborit adds.
Moreover, high customs duty of 49% is said to the main hindrance behind limited growth of the luxury watch market in India. Switzerland-based luxury watchmaker Raymond Weil is planning four more franchise showrooms in the country over the next two years with expectations that the government would lower the high customs duty.
Mr. Olivier Bernheim, President of Raymond Weil says,
"The Indian luxury goods market is not developing the way it should because of the prevailing high customs duty. This makes it difficult to trade in luxury goods like watches. No other market poses such a situation.”
Encouraged by such potentials, one of India’s leading diamond companies C Mahendra Exports Ltd. (CMEL) has also planned to introduce its unique range of hand-made watches. The group would be launching this new product range via its retail stores and online presence that form part of Ciemme Jewels Ltd., which is a subsidiary of C Mahendra Exports Ltd. It is expected by the company leaders that the launch of this range of niche hand-made watches would allow the C Mahendra Group to reinforce its position in high-end luxury watches.
Smart Watch from Apple is also being launched in India in June or July this year. So there’s no looking back now. China’s luxury watch market may be the world’s largest but India isn’t doing badly either in this segment. The watches and jewellery represent the largest and fastest growing segments within the luxury goods space in India.
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