India emerges as key destination for Swiss watchmakers: Deloitte report
National, 17 July 2024: Swiss watchmakers are turning towards India as it emerges as a lucrative market for premium watches, highlights the 'Deloitte Swiss Watch Industry Insights 2024: Spotlight on India' report. This trend is primarily led by young generations, such as Gen Z and millennials, who prefer discretionary spending inclusive of fashion and luxury experiences and products. They have also developed a passion for timepieces, further driving the watch market.
Indian consumers are keen to purchase aspirational products; each year, almost 60 percent of them invest in luxury products, such as leather goods, eyewear, watches, jewellery, fashion and cosmetics.
Moreover, 78 percent of Indian consumers looking to purchase a watch next year stated that they would like to buy one for themselves.
The report highlights that the recent Trade and Economic Partnership Agreement (TEPA), which has strengthened consumer sentiment, has created a wave of opportunities for Switzerland’s export-oriented sectors. Swiss watches are expected to have better market access as TEPA is set to reduce customs duties over the next seven years. This presents an immediate and compelling investment prospect for Swiss watch brands. India’s improved business climate adds to this favourable climate, providing Swiss firms a timely and promising avenue for expanding their footprint.
“Luxury in India is about “experience,” driven by global trends, urbanisation, brand awareness and personalisation demands. This presents a significant opportunity for luxury brands to meet evolving consumer preferences. We expect the Indian luxury goods market to grow significantly, reaching about US$30 billion by 2030. India’s rapidly growing economy with rising disposable incomes, global exposure through travel and the demographic dividend of a young population is leading to a shift in consumer behaviour towards aspirational products. This shift is driving consumer behaviour towards aspirational products, such as Swiss watches, which are seen as status symbols and valued gifts during festivals and celebrations. The rise of internet access and social media has spurred consumer aspirations and spending, especially in urban cities, through e-commerce.”
- Anand Ramanathan, Partner, Consumer Products and Retail Sector Leader, Deloitte India
Key highlights from the report
- Watches as status symbols and cherished gifts: Swiss watches are gaining traction in India. They are not just status symbols but also highly valued gifts during festive seasons and for occasions such as weddings. About 40 percent respondents frequently choose watches as gifts, especially during the festive season.
- Rising brand consciousness among Indian consumers: When purchasing a luxury watch, 64 percent of Indian consumers are brand conscious and consider the brand image to be the most important factor. About 30 percent of these consumers spend more than INR 120,000.
- Online shopping emerges as the preferred purchasing platform: About 70 percent of Indian consumers purchase watches online, through a multi-brand online platform, virtual marketplace or a brand’s website. This compares to just 38 percent in the US. Convenience and product availability are the main reasons for the preference for online marketplaces.
- Pre-owned luxury watch market on the rise: Over 50 percent of consumers stated that they are very likely or somewhat likely to purchase a pre-owned watch in the next 12 months, with the main reasons being immediate availability, affordability and sustainability. Almost 50 percent of respondents mentioned that they purchase pre-owned watches because they are cheaper than new ones. Apart from being a sustainable choice, over one-third of the participants said that they preferred pre-owned watches as they are readily available.
Buying luxury watches for investment: A significant shift is seen in consumer spending from jewellery to luxury watches, which are increasingly valued as reliable investment choices by about one-fifth of respondents.
As India evolves as a key player in the global luxury market, there are immense opportunities for Swiss watchmakers and other luxury brands. By navigating the regulatory landscape and using local partnerships, Swiss firms can establish a strong presence in India, tapping into a consumer base that values tradition and innovation. With the support of initiatives such as the new trade agreement and a keen understanding of local consumer trends, the future looks promising for luxury brands seeking to thrive in one of the world’s most dynamic economies.
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Deloitte India
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