China has been a top-priority market for luxury brands for many years. Chinese consumers account for a third of global luxury spending, and this is expected to increase by as much as 40 percent by the middle of the next decade.
While there are concerns of a slowdown in demand impacting the luxury market in 2019, you will not hear this view in our interviews with affluent Chinese consumers, who remain bullish overall about their own spending in the next year.
India’s luxury sector, on the other hand, was estimated to be a significant US$30 Billion in 2018, and has been growing double digits.
Based on our latest Affluent Insights study, the appetite of affluent Indian consumers for luxury is likely to only increase – they are eager to spend more on luxury items, upgrade to more expensive brands, and to spend on travel. In fact, India is starting to show the same behaviour towards luxury purchase that the Chinese affluent consumer had years ago.
The combination of Chinese millennials (415 million) and Indian millennials (440 million) equate to 47% of the global millennial population. Touted as “the world’s most powerful consumers” by the Financial Times, millennials have been estimated to account for the lion’s share in sales for top luxury brands, making up to 50% of Gucci’s and 65% of Yves Saint Laurent’s sales.
While the overall infrastructure in China is significantly ahead India in terms of supply chains and road, railway and air transportation, enabling the growth of the luxury market, India is keen to develop these as well, with major improvements to airports and recent purchasing of highspeed trains from Japan. Once infrastructure is in place in India, the luxury market will be propelled domestically.
With China a mature market for luxury and India an evolving one, we take a look at the affluent consumer in each of these markets.
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