According to a recent article published in the FT, Condé Nast International reveals it is ready to follow the September 2009 launch of the Indian edition of Vogue with other upmarket titles as the global fashion and luxury retail industry looks to cash in on the country’s growing affluence.
The American publisher is seeking or has obtained regulatory approval for magazines such as Glamour, GQ, Condé Nast Traveller, Vanity Fair and niche publications such as Wired, the technology-focused magazine.
India is emerging as one of the world’s biggest “millionaire factories”, with a study by Cap Gemini and Merrill Lynch showing it was second only to Singapore in terms of the growth in the number of people with net assets of $1m or more.
But it is not that easy to enter the Indian market. Indeed, the luxury retail industry faces many hurdles there from a lingering cultural and political aversion to conspicuous displays of wealth, with many people still living in deep poverty. It also faces challenges from high taxes and a lack of suitable malls for luxury retailers.
Mr Kuruvilla said Vogue would launch its first edition with an October cover date on September 22 with a target print run of 50 000 copies, taking on titles such as Elle, L’Officiel and local magazine Verve. He added that these magazines had targeted a middle-market audience while Vogue was looking to cater for the new class of high-net worth consumers emerging in India. He said the magazine was expecting advertising yields of four to five times the existing competition and to capture 50-60% market share of fashion-related advertising revenue in the first year.
In China, Vogue broke even in its first year, capitalizing on the rise of the affluent classes there. “I don’t think we’d be too far behind in terms financial achievements albeit with a smaller model,” Mr Kuruvilla said of the Indian operation.
The launch of Vogue follows the entry into India of luxury retailers, such as Ermenegildo Zegna, the high-end Italian men’s wear company, and Hermès, the French luxury goods maker. According to Mr Kuruvilla, India’s luxury retail market is ripe for a “tipping point”. It was only a matter of time before “it all explodes into a combination of the purchasing power, fuelled by mall access points and, most importantly, by the fact that there are so many of these luxury players coming in right now”.
On the other hand, as Ranjan Biswas, partner and head of retail with Ernst & Young, countered in the article, India first needs more high-end malls before the industry could take off. “I think as the high-end mall becomes a reality, luxury retailers will start to have more meaningful footfalls,” Mr Biswas added. Maybe Vogue can invest in a Vogue-branded Mall as well. Hasn´t Condé Nast International already started to dabble in the restaurant business?