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16 EXPERT SPEAKCH HOSPIT ALITY BIZ n n OCT
HOSPITALITY BIZ APRIL, 2024OBER, 2024
Growing Market of HNWIs and India’s Evolving Luxury Ecosystem

By Prem Anand, The LONDON BUTLER ACADEMY® Switzerland

n recent years, India has witnessed a sharp rise in the number of High-Net- cities like Mumbai and Delhi. Luxury consumers in India are not only looking
Worth Individuals (HNWIs), driven by the robust growth of various sectors, for products but for personalized experiences, from private fashion shows to
Iincluding IT, financial services, pharmaceuticals, and entrepreneurship. The bespoke tailoring services.
term HNWI typically refers to individuals who hold investable assets exceeding 4. Experiential Luxury: The trend of experiential luxury is gaining momentum,
$1 million, excluding their primary residence. This rapid increase in wealth is where HNWIs are looking beyond tangible goods. Exclusive travel experiences, such
shaping a new luxury ecosystem, where businesses are evolving to meet the as private jet vacations, bespoke wellness retreats, and curated culinary tours, are in
specific lifestyle needs of the affluent. However, while the opportunities are vast, high demand. Indian hospitality giants are also stepping up, offering unique, ultra-
the market also faces challenges in delivering to the exacting standards expected luxury accommodations to cater to this shift in consumer preferences.
by India’s ultra-wealthy.
CHALLENGES IN CATERING TO THE LUXURY MARKET
THE SURGE IN INDIA’S HNWI POPULATION Despite the opportunities, businesses face significant challenges when addressing
According to Knight Frank’s “Wealth Report 2023,” India’s HNWI population the needs of India’s HNWI population.
grew by 11% in 2022, bringing the total number of individuals with net assets of 1. Infrastructure Limitations: India still struggles with infrastructure gaps in
$1 million or more to over 797,000. This increase highlights the dynamic shift areas like transportation and urban planning. Traffic congestion, subpar public
occurring in India’s economy, where the rise of new business sectors and the services, and the lack of ultra-modern luxury hubs hinder the ability to deliver
global expansion of Indian enterprises have contributed to an unprecedented seamless, world-class experiences that many HNWIs expect.
accumulation of wealth. 2. Cultural Nuances: The Indian market is uniquely complex, with a mix
Furthermore, a report by Bain & Company estimates that the number of of conservative and modern preferences depending on the region and the
ultra-high-net-worth individuals (UHNWIs)—those with assets exceeding individual’s background. Luxury brands often are navigating these cultural
$30 million—is set to grow by 63% by 2026, further amplifying the need for a nuances carefully, ensuring they provide personalized experiences that resonate
sophisticated luxury market to cater to this segment. with diverse preferences.
3. High Import Duties: Many luxury products, including cars, fashion, and
MARKET EVOLUTION: TAILORING TO THE NEEDS OF THE WEALTHY electronics, face high import duties in India, making them significantly more
With this expanding HNWI population, businesses in India are rushing to cater to expensive than in other countries. This creates a disincentive for HNWIs to
the luxury lifestyle aspirations of the wealthy. Traditionally, luxury consumption purchase luxury goods domestically and drives them to shop abroad.
in India was synonymous with foreign travel, where affluent Indians would shop 4. Talent Shortage in Luxury Services: The luxury market in India suffers from
for designer brands or invest in international properties. However, as the domestic a lack of trained professionals, particularly in the hospitality and personal service
luxury market matures, high-net-worth families and individuals are increasingly sectors. The demand for skilled butlers, estate managers, and personal assistants
seeking premium experiences and products at home. Key areas where the market is growing, but there remains a gap in training and availability.
is evolving include: 5. Institutions that train staff in high-end hospitality and personal services,
1. Luxury Real Estate: Developers are catering to HNWIs by offering exclusive such as The London Butler Academy®, play a crucial role in bridging this gap.
residences with world-class amenities such as private pools, high-tech home We are looking for credible partners to develop talent. The London Butler
automation, and concierge services. Areas like South Mumbai, Gurgaon, and Academy® is the first International Butler School established by an Indian
Bengaluru have seen a surge in high-end real estate projects targeted specifically British.
at this demographic.
2. Private Wealth Management: As their wealth grows, Indian HNWIs are THE FUTURE OF INDIA’S LUXURY MARKET
seeking sophisticated financial management solutions. A report by Ernst As India’s HNWI population continues to grow, the market for luxury goods
& Young notes that private banking and wealth management services are and services is expected to flourish. The wealth management sector, luxury real
flourishing, offering everything from investment advice to estate planning and estate, and experiential services will be key drivers in this space. However, for
family office services. In addition, wealth management firms are increasingly the market to truly meet its potential, there must be an emphasis on improving
integrating philanthropic planning, catering to the desire of wealthy individuals infrastructure, reducing regulatory hurdles, and investing in talent development.
to contribute to society. In conclusion, while India’s luxury ecosystem is evolving at a rapid pace to
3. Luxury Retail: The high-end retail space in India is booming, with international accommodate the rising HNWI population, businesses will need to navigate a
brands such as Louis Vuitton, Gucci, and Hermes establishing flagship stores in complex landscape of challenges to maintain sustainable growth. The future
holds great promise, with the market likely to expand further, offering both
domestic and international brands ample opportunities to engage with India’s
“I am deeply passionate about human behaviour and its
impact on service excellence. wealthiest families and individuals.
I bring many years of successful luxury service Concierge services catering to the Ultra high networth has boomed in the last
experience from the United Kingdom. five years.
I empower businesses, leaders, and teams to
master client engagement, influence, and create
experiences which make their clients become their SOURCES:
loyal ambassadors. I am Prem Anand, the founder of • Knight Frank, “Wealth Report 2023.”
The London Butler Academy in Switzerland, which helps
businesses in India provide Swiss Standards. • Bain & Company, “India Luxury Market Report 2022.”
• Ernst & Young, “India Private Banking and Wealth Management Report. n

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