Consider this before you enter the business of luxury
Roaring tiger, emerging from the shadows, tomorrow’s market are some of the terms that are used to describe India and its luxury market. A huge middle class, a large affluent class, and an increasing disposable income are the premises of each research report and newspaper articles that talks about the growing luxury market in India. There is no doubt on the fact that the Luxury market is poised to grow in India. The numbers, as well as the purchasing pattern of Generation Y, support this. Any entrepreneur would like a slice of this cake and quite a few have already launched their ventures. For the many who are still planning, this article is for you. The website, user interface, branding, marketing, shipping, returns and after sale service will be the basic and the utmost important aspects that will make or break your venture. The bars have been set high and matching them will require a lot of ‘smart work’. And while all of these will differ from venture to venture there are three basic fundamental pertaining to luxury that you should keep in mind before embarking on this journey.
Tell them ‘The Story’
Great content will differentiate you from your competition. Luxury brands and websites across the world concentrate on ‘the story’ rather than the product. The story can be depicted in any form; words, pictures, videos or a combination of all three. For instance, if it was an expensive lamp shade or a designer handbag the story would revolve around its craftsmanship. All your potential customers will require a justification for the hefty price tag he or she is paying for your product or service. ‘The story’ provides the justification.
Choice confuses customers
Any platform would want to list as many product lines as possible. It makes sense, more the number of items more is the probability that a customer will buy something. However, in the case of luxury, this doesn’t really work. Let me give an example; if a luxury e-commerce website was to sell handbags, fashion apparel, jewelry, footwear, watches as well as personal care and perfumes all on one platform; its dropout rate would be extremely high. A customer has a limited budget and too many options, this confuses the customer until he or she gets bogged down and at some level becomes unwilling to consider anything. Economists call this problem ‘Choice Overload’. Your inventory needs to be limited.
Exclusivity defines luxury, and a luxury portal cannot be for the masses. A physical boutique can filter its visitors, whereas in the case of a luxury website this is really difficult. As an entrepreneur, this is what will take your venture to the next level. The right crowd will spread the word. If too many people know about it or shop from it; then it doesn’t seem that interesting anymore. Be careful about how you market your venture, do an in-depth research on who exactly is your potential customer, and make yourself available to him or her.
There is no dominant player in the online luxury market in India, and this is good news for all who plan a venture in this space. It’s a winner take it all market!