Mumbai, March 18: Luxury brand retailers are reaching out to the mall rats in India.

Traditionally, luxury brands like Louis Vuitton Moet Hennessy, Armani and Canali have hugged the portals of five star hotels in the belief that that is the only way they could reach out to well-heeled clients.

Not anymore.

With the economy starting to boom and households with large disposable income starting to rise in India, luxury brand retailers are no longer choosing to cling to the high street.

Mass appeal

Very soon you will not have to go to select boutiques to buy luxurious brands like Louis Vuitton, Dior or TAG Heuer. Louis Vuitton Moet Hennessy (LVMH), the world’s leading luxury product group which has more than 60 of the world’s largest luxury brands in its stable, wants to go mass market.

LVMH is in negotiations with a clutch of organised retail and real estate players that include Reliance Retail, Pantaloon Retail, Shoppers’ Stop, DLF and Emaar-MGF Land Pvt Ltd to market some of its products through their network.

At present, LVMH largely uses the single-brand retail route to market its mono-brand concepts, while some of its products are distributed by local partners. But it is now looking at both retail and real-estate companies to widen its reach.

Retail industry sources say LVMH isn’t the only one looking at marketing premium products through their networks. Armani and Calvin Klein are some of the other brands that have been in talks with domestic retailers over the past few months.

Ravi Thakran, LVMH’s group director (South Asia), told The Telegraph that the group has not finalised the products it plans to retail through these companies. He indicated that it could be specific products per company or a combination.

Widening reach

After opening the first Louis Vuitton boutique in Delhi on 2003, LVMH is optimistic about marketing prospects in India. “I believe, we have only scratched the surface. India is opening up and the retail business is developing fast. Luxury is developing a destination with new platforms emerging. We are present in Chennai, Hyderabad and Calcutta apart from Mumbai, Delhi and other centres and the plan is to widen our reach,” said Thakran.

The potential of India, he says, is amplified by the fact that some centres in the country have sprung a surprise. For instance, after LVMH commenced operations in the country, the largest sale from a single shop for watches comes from Calcutta and it is way ahead of Delhi or Mumbai.

Further, South India is one of the fastest growing regions with centres like Chennai, Coimbatore, Hyderabad, Bangalore and Cochin showing a lot of promise as they are now “indulging in luxurious brands”.

It is perhaps with this potential in mind that LVMH is planning to introduce some of its other products.

Goods aplenty

The group now plans to launch watches from Zenith, the fashion brand Kenzo, the top-of-the-line British shirting brand Thomas Pink and luxury women’s leather bag brand Celine over the next few months.

Tag Heuer, the watch range which starts from Rs 33,900, Dior, Fendi, Louis Vuitton, Belvedere, Dom Perignon, Moet and Chandon are some of the other brands from the LVMH stable that are already present in India.

India accounts for less than 1 per cent of LVMH’s global business today. Thakran says the target is to generate 10 per cent of its worldwide business from the country over the next few years.

In some product categories such as premium watches where Tag Heuer occupies the third slot in India after Omega and Rado, LVMH plans to topple these brands over the next three years. “Sales of Tag Heuer has been growing from few hundreds to few thousands. We want it to sell more than 100,000 units annually,” said Thakran.

Duty dilemma

Thakran said the fundamental problem in India against luxury goods were the high duties and taxes that range from 50 to as high as 400 per cent for certain categories.

“In the 1990s, China had similar duties as India. By the mid-90s, it brought down duties and now it is the biggest market in the world. The same could happen to India. If the duties are lowered, more brands could come in and companies would invest more,” he added.

LVMH is also set to unveil Sephora, its retail concept. Sephora, which is a key retailer of cosmetics, has three focus areas that include skin care, fragrances and make-up. LVMH plans to open 40 to 50 such stores over the next four years.