With increasing globalisation and urbanisation, there has been a significant increase in the spending capacity of consumers. Their changing lifestyles and a growing interest in tourism and travel are fast giving a much needed boost to the Indian luggage industry. The segment has, over the years, shed its traditional utilitarian tag and has evolved as a lifestyle product. Increasing business and leisure travels coupled with rising disposable income and organized retailing have led to increased demand for luggage. Along with this, a boom in online commerce, has given a considerable pace to the fast growing luggage industry enabling brands to reach out to smaller markets as well. Also, within this category, the demand for brand names has grown, as consumers aspire for goods that count as status symbols.
“The biggest factor leading to evolution of the luggage industry is that luggage is not just a travel utility anymore, it is a lifestyle product, a fashion accessory. Trendy looking trolleys and bags add to the look. The demand too has grown exponentially over the past few years,” says Sahil Malik, Managing Director, Da Milano.
Bags can range from casual to business travel segments as per the consumer’s requirements.
From Unorganised to OrganisedThe Indian luggage market can be broadly segmented into organised and unorganised sectors, with the unorganised sector still occupying a majority share. However, with the spurt in demand, many organised players have started entering the space and these brands are taking various steps to educate the customers.
“For us, education and imparting knowledge to our customer is what we want to focus on the years to come and hence, we plan to be very content heavy on our website and other social media platforms. Educating our customers on what they will be purchasing is a priority, as it is important that they understand its quality, features and design of the product. We believe in selling a story with each piece of luggage that we make,” says Sachi Maker, Vice President- Marketing, Traworld - which is planning to open EBOs by the start of next year.
Apart from this, with growth in modern retailing and fashion consciousness among consumers, luggage products are becoming more than just a mere travel accessory. They are becoming lifestyle products, acting as status symbols.
Owing to this, consumers are slowly and gradually gravitating more towards branded products instead of unbranded ones. In the long run, GST will be beneficial in making luggage market more organized and therefore add to the demand of branded luggage, as the small or local players will cease to exist.
Online v/s Offline - Which Channel Is Driving Growth?
With more consumers gravitating towards online retail, the Indian luggage industry is ensuring its presence on the medium, and online retail in turn is responsible for the industry’s growth trajectory. Increased exposure to various e-commerce platforms have led to the increase in demand for more and more options for travel accessories.
“We use the hyper, trade and e-commerce channels for sales. E-commerce has proved to be the fastest growing channel for all our brands, and we predict that the trend will only increase over the years,” says Pandharkar.
According to Jai Krishnan, CEO, Samsonite South Asia Pvt. Ltd, his company had assessed the potential of e-commerce at a very early stage, at a time when it was still strengthening its presence in the physical retail space in India.
“Our focussed approach helped us gain early movers advantage and we continue to enjoy same even today. Currently we are present on all leading online marketplaces, including Flipkart, Amazon, Snapdeal, and Myntra. We anticipate the growth rate from online channels will continue to increase as a larger proportion of the population gains access to the digital world.”
Despite the leg up from online channels, many brands are of the firm belief that customers need to touch and feel before they buy. They say that consumers regularly check out products and compare prices online but end up making the actual purchase at a physical store.
“We still getting 95 percent of our business from the traditional medium. We have listed our products on Amazon, Flipkart and other digital channels, which is contributing approximately 5 percent of sales,” says Manoj Choukhany, Chairman and MD of Goblin India Ltd.
Resonating Choukhany’s thought, Indranath Sengupta, Director, Kompanero says, “By far, offline stands tall, contributing majorly to the brand’s revenue, but at the same time we are keeping our pace up with today’s world by focusing on our e-commerce channels as well. To achieve the vision of the brand, it is important that both the channels go in partnership. We are proud to say that as we are achieving various milestones by opening more brick-and-mortar stores, so are we for online by channelising our presence on all online platforms which include – our brand’s website ‘www.kompanero.in’, and other e-commerce portals such as Myntra, Amazon etc. As online retail is still at a nascent stage in India, the growth is positively steep and something we are very excited about.”
Brands Innovate, Invent New Features
The modern consumer wants more – he wants a product that screams fashion, that conveys his lifestyle, that helps him make a fashion statement among his peers. He also wants a product which is loaded with features, which is innovative, inventive and fulfills all his needs.
And brands are delivering!
“We have introduced a new collection called ‘Smart Luggage’. The collection features distinguished products with added smart features, specialised designs and styles, wherein the luggage comes with a weighing scale that helps users o ascertain the weight of bag hassle-free and without strain, as weight measurement is imperative while travelling. It is a feature for convenience as the scale is built at the top handle of the trolley,”” explains Malik.
“Innovation has always been at the core of Goblin India Ltd. A good example of this is the anti-theft luggage bag, which sets off an alarm if strolled at a distance more than 10 metres from its owner. The alarm can be controlled easily using a mobile app. Another example is a luggage bag with a USB port. These technologically smart products have been made taking into account the modern needs of customers,” Choukhany says.
Another company called Spicestyle, a subsidiary of SpiceJet, is also working on smart luggage with ‘proximity alerts’ that – once activated– notify users if they go faraway from their luggage.
Samsonite first introduced the ‘Samson’ trunk, the world’s strongest suitcase. This was followed by a string of unique features and innovations over the coming decades, including lightweight ‘Streamlite’; ‘Saturn’, constructed from high impact polypropylene material; the wheeled ‘Silhouette’; the inbuilt zipper of the ‘Ziplite’; the ‘Crusair’four-wheeled spinners; and the ground-breaking Curv technology of the ‘Cosmolite’.
“One of our most recent design innovations is the introduction of the easy-brake system in our ‘Polygon’ collection. Designed in conjunction with Hinomoto Japan, it incorporates a smooth double wheel and stopping function, and ensures that upright movement is still capable when two wheels are locked. This is further supplemented by a Flat-Max structure, which maximises the storage capacity of the line through a 20/80 split structure. 20 percent of the lid area is assigned to the trolley system, while the remaining 80 percent serves as a dedicated storage area, allowing for the ultimate packing ability and experience. The most recent development out of this centre is the ‘Skytracer’, zip-closure suitcases made from poly-propylene,” says Krishnan.
Despite the oligopolistic nature of the luggage retail industry in India, organised brands are very optimistic about its growth prospects. With the travel and tourism sector set to witness growth, the luggage industry is expected to see a growth of 8.3 percent from 2019 to 2023.
“The growing demand for high-quality luggage products –dustproof, fireproof, crack proof and durable –is expected to expedite the growth of the luggage sector. What will make any brand stand out in such a scenario is product innovation and usability,” says Choukhany.
Talking on the same lines, Jai Krishnan, CEO, American Tourister says,“ Consumers are becoming more responsible as more and more travellers are supporting sustainable travel experiences as well as products, and hence we can expect a surge in demand for sustainable products. This automatically means a growth for the industry as well as need for innovation.”
Moreover, with large disposable income and travel gaining momentum, there will be a growth in demand of premium luggage and smart luggage. The growing government support for the leather luggage industry is further driving growth in the segment.
“Sports and outdoor luggage is another segment that will see huge growth in coming future, with the increased appreciation for fitness among Indians and growing affinity toward adventure travels,” states Radha Arora, Senior General Manager - BU, Spicejet Merchandise Pvt. Ltd.
All in all, if the organised sector can hold its growth momentum, then the luggage industry is bound to reach the top tier of the consumer durables category in India over the next few years.