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(Pakistan is) Not in the lap of LUXURY .yet
By: Marylou Andrew
Presented By:
Syed Mubashir Ali
Agenda
Objectives
Luxury intl Facts
The Next-11 group
Luxury & Pakistan . . . HOW??
(Re)defining luxury
Worldwide Trends in luxury
Luxury brands in Pakistan
The luxury brand challenges
Giving luxury a chance
Objectives:
Whos leading luxury goods market in terms of sale
Emergence of BRIC as future leaders of luxury goods
market
The NEXT 11 Group (N-11)
Standing of Pakistan in terms of luxury goods market
Challenges & Recommendations
Luxury International Facts
US is largest luxury goods market in terms of sale
Chinas share of the global luxury goods market will
increase to 44% by the year 2020
An estimated 10% growth in 2011 in luxury goods will
come from the BRI C countries
But Europes luxury markets will still lead the way
the Next 11 will contribute significantly to luxury
consumer spending in the coming years
The NEXT 11 Group (N-11)
In 2005, Goldman Sachs identified the N-11 which
combined with economic and political conditions could
greatly impact the global economy.
Pakistan Bangladesh
gypt. Indonsie
Iran Korea
Mexico Nigeria
Philippines Turkey
Vietnam
Most important reason is a large, young population and an
increasing level of affluence (particularly among young women)
Luxury & Pakistan. . . .
HOW??
Luxury goods section accounted for 11% total retail
value showing CAGR of above 7% since 2003 even in
economic depression year(2008)
10% of the wealthy account for 27.6% of total spending
in Pakistan (Nations of the World Encyclopedia)
Inequitable distribution of wealth
Urban Pakistan is a high potential market for luxury
items
(Re)defining luxury
In pure economic terms, a luxury is any item for which demand
increases more than proportionally when income increases
Luxury Brands definition is subjective in Pakistan because current
definitions come from societies and economies vastly different from
ours.
Worldwide Trends, redefining LUXURY
Democratization
A trend whereby high-end luxury brands are making their products
accessible to a wider range of income groups to expand their market
share
Masstige (mass premium)
Brands which offer premium quality at low prices; this concept is
particularly prevalent in the skincare category where traditional drug
store brands such as Ponds have launched premium quality
specialized skincare products.
Luxury brands in Pakistan
Based on discussions with marketing experts, there are two tiers of
luxury brands in Pakistan;
Premium
Global Brands like, Charles & Keith, Mango, Next and Vincci
Local Brands like designer lawn to high-end cosmetics and skincare products
Super Premium (luxury brands in the truest sense)
Luxury cars (BMW, Jaguar, Mercedes, Porsche)
Fashion Brands (Louis Vuitton, Armani, Versace)
International luxury brands are reluctant to
invest in Pakistan, partly because of our
image problem and partly due to the lack of
data to base predictions and returns on.
Role of Private Entrepreneurs
True luxury brands are imported by Entrepreneurs
which impacts the luxury market in a number ways;
These brands are not widely available or widely known
Because they are privately imported, the selection of
products and designs is usually limited
The business is almost totally undocumented, making it
impossible to estimate the real market of luxury goods
in Pakistan
The luxury brand challenges
Following are the four main challenges which
international luxury brands have to face in Pakistan
Taxation
Location
Quality of Service
Marketing
Giving luxury a chance
Go from Premium to Super Premium
Premium category should be expanded to include more FMCG and
hospitality
Greater awareness about availability of luxury brands should be
made
Luxury marketers should capitalize on tremendous inspirational
value of luxury
Most importantly, we should develop local luxury brands
Presentation Source:
June, 2011 issue of Aurora magazine