New Delhi: Swiss watchmakers are increasingly focusing on India, which is emerging as a lucrative market for premium watches. The rising interest among Gen Z and millennial consumers who are inclined towards luxury experiences and products is driving this trend according to a Deloitte report, released on Wednesday.
The report highlights the Trade and Economic Partnership Agreement (TEPA) as a significant factor, as it promises reduced customs duties over the next seven years, creating favorable conditions for Swiss watch brands to invest in India.
This trend is further fueled by the recent TEPA, which has strengthened consumer sentiment and created numerous opportunities for Switzerland’s export-oriented sectors, as per the report.
Deloitte estimates the current value of the Indian luxury goods market to be around $7 billion and predicts significant growth to approximately $30 billion by 2030. The Future of Retail study conducted by Deloitte shows that around 60 per cent of consumers spend on luxury goods annually, including luxury leather goods, eyewear, watches, jewelry, fashion, and cosmetics. Notably, nearly 30 per cent of these consumers spend more than Rs 120,000, which is roughly $1,440.8.
Anand Ramanathan, partner, Consumer Products and Retail Sector Leader at Deloitte India, discussed the perspectives on luxury in India.
“Luxury in India is about ‘experience,’ driven by global trends, urbanization, brand awareness and personalization 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,” he said.
He further outlined the factors contributing to this growth. “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 behavior towards aspirational products. This shift is driving consumer behavior 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,” Ramanathan added.
As per the report, Swiss watches’ exports to India amounted to CHF 218.8 million in 2023, making up 12 per cent of all Swiss non-gold exports to India. This sector has also recorded the highest annual growth rate of 11 per cent over the past 20 years. The increasing appeal of Swiss watches in India is reflected in their role as status symbols and prized gifts, especially during festive seasons and significant occasions such as weddings.
The report further indicates that about 40 per cent of respondents often choose watches as gifts, particularly during the festive season.
When it comes to purchasing luxury watches, Indian consumers show a strong preference for well-known brands.
About 64 per cent of consumers are brand-conscious and consider brand image to be the most crucial factor when buying a luxury watch. Moreover, approximately 30 per cent of these consumers spend more than Rs 120,000 on these timepieces. The trend of online shopping for luxury watches is quite prominent, with about 70 per cent of Indian consumers opting to purchase watches online through multi-brand platforms, virtual marketplaces, or brand websites, compared to just 38 per cent in the US.
As India positions itself as a key player in the global luxury market, Deloitte points to significant 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,” the report concludes.
Thus, the potential for growth and investment in the Indian market is significant for Swiss watch brands, driven by favorable trade agreements, increasing consumer interest, and a robust luxury market.
