Shoppers Stop to venture into luxury retail with large-format standalone stores
12 July 2024, Mumbai
India's oldest department store chain, Shoppers Stop, plans to venture into luxury retailing with large-format standalone stores featuring brands such as Gucci and Louis Vuitton. The company aims to launch two luxury outlets this fiscal year, with potential locations in Kolkata and Mumbai.
Shoppers Stop has traditionally focused on the masstige or bridge-to-luxury segment since its inception over three decades ago. However, the shift towards luxury retailing aligns with the growing number of wealthy individuals in India. For the retailer, more than just selling luxury products, premiumisation includes elevating the buyer’s shopping experience, says Kavindra Mishra, Managing Director and CEO.
The luxury retail market in India is currently dominated by Reliance and the Aditya Birla Group who have partnered with over 50 luxury brands. These luxury brands struggle to finda suitable retail space to create an exclusive shopping environment without compromising customer experience, notes Shriram PM Monga, Co-founder, SRED, a of retail consultancy firm With limited luxury-dedicated malls in India, the demand for luxury retail spaces remains high.
According to a Bain & Co report, India's overall luxury market is expected to reach $85-90 billion by 2030. This growth is driven by a rising number of ultrahigh-net-worth individuals, growing entrepreneurship, a strong middle class, greater e-commerce penetration, and demand from Tier-II and III cities. The premium and bridge-to-luxury fashion market in India is currently valued at $7.86 billion, and global luxury brands are eager to expand in this promising market.
Shoppers Stop aims to increase the contribution of premium brands to 55 per cent in the current fiscal year from 47 per cent in FY24. The retailer’s revenue grew by 34 per cent in the last fiscal year, primarily driven by non-apparel segments such as beauty and home categories, alongside store expansion. The company's strategic focus on premiumisation and store network expansion is reflected in its investment of Rs 246 crore for opening 55 new stores and renovating 13 existing ones in 2023-24.
