India's luxury market, valued at USD 8.5 billion in 2023 and projected to reach USD 22 billion by 2030 at a 14.5% CAGR, has emerged as one of the three fastest-growing luxury markets globally alongside China and Southeast Asia. The Indian luxury consumer profile is distinctive: a bimodal distribution combining India's 860,000 dollar-millionaires who exhibit consumption patterns comparable to Western luxury consumers in terms of brand sophistication and international travel exposure, and a much larger 'aspirational luxury' segment of approximately 38 million upper-middle-income households consuming entry-level luxury goods as status signalling and quality hedging against the counterfeiting risk that pervades India's unbranded apparel and accessories markets. This study examines luxury brand consumption across 2,480 respondents in metro, tier-2, and tier-3 Indian cities, employing conjoint analysis for willingness-to-pay premium estimation, a three-dimensional surface model of WTP as a joint function of income and aspiration score, and confidence ellipse consumer segmentation identifying four distinct luxury consumer segments. A donut chart reveals luxury spending category distribution, while box-whisker distributions confirm brand loyalty's significant variation across city tiers. The INSEAD collaboration contributes the luxury brand equity measurement methodology and the hedonic consumption framework distinguishing conspicuous consumption from connoisseurship motivation. WTP premium ranges from 8.4% (eco-packaging, rural) to 36.2% (green building features, metro), and four consumer segments — Affluent Brand Loyal, Aspirational Buyers, Value-Seeker Luxury, and Occasion-based — show statistically distinct price-consciousness and brand-consciousness profiles.
Arjun Gupta Rupa Krishna (Fri,) studied this question.