By Shivaji Dasgupta
Quite expectedly, the luxury retail sector in India suffered a 33% dip in the first year of Covid, as per Euromonitor estimates. Quite unexpectedly, the same source confirmed that the sector was fairly close to restoring its stature in 2021, certainly an outcome of evolutionary consumer behaviour.
For starters, while 30% of salaried India was deeply affected by the pandemic, 70% operated rather normally, with jobs and bonuses totally intact. Popular narratives quite naturally veered towards the former, while truthfully, the latter’s monetary arsenal was continually fortified by higher savings. This was a function of zero expenses on high-end experiences, holidays and fine dining, complemented by an ever-expanding urge to splurge, an outcome of involuntary captivity.
The new gatekeeper
Experiential stores were usually the gatekeepers of luxury retail, but the pandemic enforced their temporary suspension. As an outcome, the shopper shed conventional inhibitions and chose to discover her manna online, not just for selection but, indeed, for purchase — no need to touch and feel. Early reports suggest a significant rise in high-end e-commerce, from bags to jewellery, as we all attempted to restore elusive normalcy. Today, the reopened stores are reportedly full, but even if further waves reappear, the customer will surely find solace in the digital boutiques.
You may well believe that the pandemic severely restricted social encounters and, thus, the opportunity to flaunt the newly acquired chic hardware. There is now sufficient evidence that shopping motivation is moving from demonstration to possession. People shopped to delight themselves and in wishful anticipation of happier days ahead, a positive emotional sentiment in trying times. Quite reminiscent, albeit higher ticket, of the legendary Lipstick Effect in the US (originally from the Great Depression), where ladies flaunted their red lips to defy the debilitating impositions.
The direct-to-consumer trend also coincided with the pandemic, further fuelling the habit of high-end digital adoption. Luxury customers were already warming up to bespoke miniature businesses that were high on quality and exclusivity, thus further accelerating online purchase spontaneity. In truth, this sector is also gaining mammoth traction of late, especially high-end wellness and beauty products, as we are spending more quality time with ourselves. Luxury consumption is now operating on parallel trajectories — the legacy brand at DLF Emporio and the passionate entrepreneur on Facebook. The early stages of the metaverse will also fuel the momentum, as seekers can feel the realistic presence of brands online, thus becoming credible surrogates of real-life experiences.
Shopping to feel good
It would, thus, be appropriate to call this resurgence of luxury goods as revival shopping, certainly less morbid than revenge. This being a truly holistic revival which goes beyond the replenishment of personal repertoire, extending sharply to enthusing morale and perceived self-worth. As an invaluable value addition to society at large, this helps save and increase jobs, as this sector is a prolific employer of skilled folks.
To understand the integrated impact of revival shopping, luxury in focus, we must begin with mental health, a foundation of our overall well-being. Our outdoor exposure is still severely limited (international travel especially), and the joy of acquiring priceless possessions operate as a happy surrogate, a symbol of continuity. We will still share them with our dearest friends, even if online, and will spend extra time and effort in taking exceptional care of ourselves. As weddings and parties reappear, the necklace and handbag will again take pole position in the theatre of the living.
In sum, the continuing pandemic has not just resurrected the luxury goods market, but altered consumer behaviour fairly permanently, which, rather interestingly, is a sustainable insurance policy for the folks, surely comforting the anxious ecosystem.
The author is MD, Inexgro Brand Advisory
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