Luxury brands prefer online sites to reach Tier II, II customers

In the absence of luxury malls in smaller cities, retailers of luxury products are depending on e-commerce websites to sell their wares. Recently, Reliance Brands had to fall back on top online sites to sells its portfolio of 18 high-end brands especially in places like Amritsar which doesn’t have any luxury mall.

Luxury malls are present only in top three cities. So, luxury brands are now resorting to established online marketplaces to reach non-metro markets with potentially high net worth clientele such as Amritsar and Ahmedabad. As Darshan Mehta, CEO and President, Reliance Brands points out there is no reason why online players shouldn’t sell at whatever price once they have bought the goods. E-commerce, he believes, is a whole new channel of acquiring customers. But not all follow this rule. Tata CLiQ which has got Genesis Luxury on board, allows latter to decide its own pricing. Selling goods on a consignment basis rather than selling upfront to online marketplaces leads to control of prices in the case of upmarket brands. Tata CLiQ’s CEO Ashutosh Pandey points out that luxury brands stay away from marketplaces since they tend to give discounts but Genesis has been given the flexibility to control prices. This is because it has taken the responsibility on behalf of the luxury brands that it sells through Tata CLiQ site.

Genesis which distributes 14 luxury brands like Burberry, Michael Kors, Armani, Canali, Jimmy Choo, Hugo Boss and Coach, is now selling online for the first time through Tata CLiQ.

Crystal brand Swarovski had planned to launch its own luxury site in 2016 but then decided against it and instead chose fashion portal Myntra to sell its products.