Luxury phones getting grand reception in India

BESIDES the Nokias and Micromaxes, the iPhones and BlackBerrys, there is another set of brands fighting it out in India’s booming mobile handset market—the likes of Georgio Armani, Versace, Christian Dior and Tag Heuer.

These international fashion labels are competing with Nokia’s own Vertu and Swiss brand Goldvish to sell handsets, not as a tools for communication or all-in-one gadgets, but as statusdefining lifestyle products for the super rich willing to spend lakhs.

“Various mobile brands have introduced phones that are high on luxury and many make these handheld gadgets the right accessory to gel with one’s personality,” says Sudhin Mathur, business head — mobile communications, at LG India, which retails Versace’s designer phones in the country for more than Rs 2 lakh each.
And these phones are getting the right numbers, with a market size of $20 million and growing at an annual rate of 20%, company insiders say.

That may not be outstanding in a Rs 27,000-crore (2009-10) industry growing almost at the same rate, but these numbers seem attractive enough for the players to expand their operations and launch new models.

Samsung recently launched a new model in the Giorgio Armani phone collection designed by the master designer himself – priced at over Rs 40,000.

“Customers are increasingly becoming more design and brand conscious, especially when it comes to mobile phones,” says Ranjit Yadav, director – mobile & IT, at Samsung India.
Samsung had earlier also launched two handsets designed by Giorgio Armani – Giorgio Armani Samsung in 2007 and the Emporio Armani Samsung Night Effect in 2008.

French luxury goods maker Louis Vuitton Moet Hennessy (LVMH), which forayed into Indian luxury handset market through its labels Christian Dior and Tag Heuer in 2008, plans to sell about 700 phones a year and cross 1,000 handsets a year by 2012, according to Manishi Sanwal, general manager, LVMH Watch & Jewellery.
Interestingly, these phones are not smart phones. They don’t come with Internet packages and dedicated music downloads. They are pure lifestyle products. They compete with luxury watches, not with the iPhones and BlackBerrys.

Aspiration is the basic driver behind increasing demand for designer phones, says Naveen Mishra, lead mobile handsets analyst at IDC India.

“The reasons for the growth of this segment may be attributed to the increasing affluence of Indian society at the upper middle class and higher strata, where ownership of a premium product is seen as a class statement,” he says.

The section of the society consisting fashionistas and movie stars is also big customer base for the luxury handset makers, Mr Mishra says.

Pankaj Mohindroo, president of Indian Cellular Association representing handset makers, says Swarovski crystal-studded or gold-rimmed phones, generally defined as luxury phones, sell less than 10,000 units a year. This is less than 1% of the 108 million handsets sold in the country last fiscal.

However, he says, the growth in demand for luxury handsets is impressive.

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