Thomas Kastgen, Chairman, Leading Brands of the World
<p align=justify>With a luxury boom in India, there are over one million luxury consumers, which is only a fraction of eight million plus consumers who have the disposable incomes but are unfamiliar with the luxury segment. The growth rate is 14.6 per cent. Target audience is 22-55 year olds. India’s luxury goods market of Rs 717 billion is set to expand with a new firm to facilitate process by bringing together buyers and manufacturers. India’s total retail market has been estimated at $160 billion or Rs 7,170 billion, covering eight million consumers. Of them, one million are considered to be in the luxury brands segment.
With a luxury boom in India, there are over one million luxury consumers, which is only a fraction of eight million plus consumers who have the disposable incomes but are unfamiliar with the luxury segment. The growth rate is 14.6 per cent. Target audience is 22-55 year olds. India’s luxury goods market of Rs 717 billion is set to expand with a new firm to facilitate process by bringing together buyers and manufacturers. India’s total retail market has been estimated at $160 billion or Rs 7,170 billion, covering eight million consumers. Of them, one million are considered to be in the luxury brands segment.
Leading Brands of the World is the only professional entity aimed at driving the ‘luxury business’ in India, and its Chairman, Thomas Kastgen, has dedicated the last 15 years of his life to the luxury goods trade in Europe and the Middle East. In his capacity as CEO of Middle East Aston Martin, Kastgen is responsible for strengthening the market positioning of Aston Martin as one of the leading luxury sports car brands. He has also spent the last year analysing the Indian luxury automobile market and is responsible for creating India’s first white paper on luxury automobile trading.
Kastgen has always had a special interest in the luxury automotive trade. After graduating from the German Business School, he held management positions with Mercedes Benz and Audi in Europe. For the last eight years he has been in the Middle East working with Audi and currently Aston Martin.
In conversation with exchange4media’s Pallavi Goorha, Kastgen speaks about the concept of luxury brands and how he plans to expand the Leading Brands of the World in India.
Q. What is the scope for luxury brands in India? What, in LBW’s estimates, is the size of the luxury brands market in India, and expected growth and trends?
With a luxury boom in India, there are over one million luxury consumers, which is only a fraction of eight million plus consumers who have the disposable incomes but are unfamiliar with the luxury segment. The growth rate is 14.6 per cent. Target audience is 22-55 year olds. India’s luxury goods market of Rs 717 billion is set to expand with a new firm to facilitate process by bringing together buyers and manufacturers. India’s total retail market has been estimated at $160 billion or Rs 7,170 billion, covering eight million consumers. Of them, one million are considered to be in the luxury brands segment.
Q. Who are your clients currently? Are there any other international luxury brands that you are in discussion with?
Leading Brands of the World’s clients and partners already include Middle East Aston Martin, Porsche India, Pershing Yachts India and THANKS, a luxury retail space housing, as also leading brands such as Van Cleef and Arpels, Fendi, Dolce & Gabbana and Stella McCartney. They also announced their forthcoming events for the year 2006, in India a Leading Jets, Yachts & Automobiles Brand Forum, which will bring country and regional heads of leading luxury brands together with India’s decision makers, opinion leaders and HNI; and a charity event with Unicef that is currently under way.
Q. Do you have any prior experience in handling the entry of foreign luxury brands in India?
Yes, we have experience in handling the entry of foreign brands in India as we have a team of international consultants with whom we work.
Q. As a global brand expert, what are the Indian brands that you think are best of breed and can become global brands?
I feel fashion designers like Tarun Tahiliani and Manish Arora are designers of best of breed and can become global brands.
Q. What are the major hurdles a foreign brand faces while entering India?
One of the major hurdles any brand faces is that the Indian market is very different from the European market. They don’t understand whom to approach. Then we do market research, survey. Brand collection is also an issue. They just don’t want to meet someone rich but need to meet the brand to survive. Taxation situation is improving, but it’s still a hurdle. Infrastructure is a major issue. The understanding of what luxury really is, finding an appropriate place at the right price and the right target audience.
Q. Which of the luxury brands do you think are growing the most In India?
Electronics is growing at the top end. They are growing at 25 per cent. The fashion industry is growing at 20 per cent, cars is growing at 20 per cent, while jewellery is growing at 20 per cent.
Q. There is a concern among branding professionals here that despite India becoming a global economy, there is no Indian brand that has become a global brand. What is your view on this?
You are right. One of our aims is to bring the Indian brands abroad. We are targeting one big Indian player in fashion whom we are targeting to take it abroad.
Q. What will be the role of Leading Brands of the World in assisting luxury brands venturing into the Indian market?
Our expertise span from orchestrating a comprehensive entry strategy, including in-depth market survey, research and analysis, creating brand launch platforms and introductions to the right target sets. Further identifying the befitting image partner for strategic alliances, generating awareness and visibility by suitable brand positioning. We act as a guide in foreign markets and assist brands in identifying appropriate retail space, developing and implementing bespoke event programmes and creating a platform to meet with other ‘best of breed’ brands. Thereby, Leading Brands of the World promotes best practices shared across luxury segments and developing collaborations for brands to network, facilitate and transfer business development opportunities.
Q. How can LBW really help an Indian luxury brand looking to foray into both the domestic and international markets?
Leading Brands of the World has identified the cause and effect related to the premium gap in India’s luxury brand marketing sphere, our company strengthens business relationships with the brand executives in India and abroad to co-develop each brand’s local marketing strategy and reflecting their international position and standards at all times. With the ability to remain focused in delivering innovate brand marketing solutions for the Indian luxury market place, our company provides a unique one-stop shop brands to effectively showcase themselves as per international standards and yet keeping in mind local culture and norm.
Q. Why should a brand take the help of LBW to venture into the Indian market or the overseas market?
Some of the brands get lost in the Indian market. We understand the Indian market. We have the knowledge so that the brand doesn’t get lost. LBW helps the brand in incorporation, registration and its development. We help them with the marketing touch so they don’t dilute themselves locally. A comprehensive range of services is offered that includes brand entry, development and proliferation, PR programmes, strategic alliances, think-tank forums, strategic forums and business development opportunities We assist them with business plans, white paper and research Company Acts as a guide in foreign markets and assist brands in identifying appropriate retail space.
Q. What is Leading Brands of the World all about? Who are the key people behind it? How did the concept emerge?
Leading Brands of the World is an Indian organisation. Headquartered in Delhi, with offices already in Delhi and Mumbai, Leading Brands of the World is in talks to expand its footprint internationally. We have a team of eight people working for us. They are experts in business development and client development. The team already has international exposure and we are also working with international consultants. We registered the company in mid-April, 2006. We started the company officially on April 27, 2006. The primary aim of Leading Brands of the World is to assist international ‘best of breed’ brands in their expansion programme in domestic as well as overseas markets. Leading Brands of the World understands the needs of the luxury market in India and the know-how to provide meaningful, result oriented marketing strategies that focus on the brand’s real need. Our mission is to make LBW a strategic one-stop shop for brand.
