Premium & Luxury Bathroom Brands in India Post COVID Crisis
Updated: Dec 5, 2024
Market Transformation Post-COVID
The Indian bathroom market has undergone an interesting transformation in the aftermath of the COVID-19 pandemic. This transformation has been particularly evident in the growth patterns of luxury brands compared to their economy/middle priced counterparts. Although luxury brands have traditionally held a smaller market share, interestingly their growth trajectory post-pandemic has been notably steep in India even though from a much smaller base compared to mass market, low-to-middle price brands. On the other hand, low-to-mid brands, despite their dominant position in terms of volume, have experienced slower growth in comparison.
Growth of Luxury Brands
During the period of 2020-2022, Hansgrohe, a leading luxury bathroom fittings manufacturer has witnessed a sharp growth in demand for its products and even tripled its sales in value terms. In fact, the company has found demand from not only the major metropolitan cities of India but even higher demand from the tier 2 cities. The success has encouraged the German manufacturer to set up manufacturing within India. And it has indeed done so with setting up an assembly unit in Pune for which the operations are set to commence this year. Currently, the Indian arm of the company relies entirely on imports from Germany.
Kohler, a premium bathroom brand has also seen success during and after the pandemic in India with demand for its products witnessing a significant jump post pandemic. A steady market before COVID-19, India is now the fastest growing market for Kohler and the company anticipates that India may become its third largest market after US and China by 2025. The pandemic's effects have in fact been advantageous to the company, especially in terms of higher home sales.
As a matter of fact, domestic manufacturers such as Hindware, Cera and Jaquar that are traditionally associated with serving the middle-class and economy segments have also introduced their high-end luxury brands. And, they have been actively pushing these brands for the past few years after realising how successful companies like Hansgrohe and Kohler have been. Among them, Queo from Hindware and Artize from Jaquar are well-known.
Factors Influencing Market Dynamics
The divergence in growth rates can be attributed to several underlying factors that shaped consumer behaviour and market dynamics during and after the pandemic. Economic recovery, policy reforms, increasing internet penetration, growing awareness, expanding affluent population, and soaring aspirations have all lead to surge in demand for luxury products in India and this includes bathroom products. The digital transformation of luxury brands has been a significant factor in their post-COVID growth. With the pandemic accelerating the shift towards online shopping, luxury brands with strong digital strategies were able to capture the attention of consumers who increasingly turned to e-commerce. These brands leveraged their online presence to showcase their premium offerings through virtual showrooms, interactive websites, and personalized digital consultations. The convenience of online shopping, combined with enhanced customer service and seamless delivery experiences, helped luxury brands to expand their reach and attract a broader audience during the pandemic.
Another key driver behind the surge in demand for luxury brands has been the increased focus on home aesthetics. As the pandemic forced people to spend extended periods at home, many turned their attention to home improvement and renovation projects. This shift in priorities saw consumers willing to invest in high-end sanitary ware and taps that not only enhance the functionality of their spaces but also elevate the overall aesthetics. The desire to create a more comfortable and luxurious living environment spurred the demand for premium products, leading to a significant boost in sales for luxury brands.
Moreover, the pandemic also brought about a noticeable shift in consumer preferences, particularly with regard to wellness and hygiene. As health and safety became paramount, discerning consumers have gravitated towards products that offered advanced features designed to promote hygiene. Luxury brands, known for their innovative designs and cutting-edge technology, were well-positioned to meet this demand. That said, the resilience of the affluent segment continues to play a crucial role in driving the growth of luxury sanitary ware and taps. While the pandemic brought economic challenges for many, the wealthier sections of society remained relatively unaffected in terms of disposable income. This financial stability allowed affluent consumers to continue indulging in luxury purchases, including high-end bathroom fixtures. In contrast, the low-to-mid segment of the sanitary ware and taps and mixers market faced a different set of challenges that limited its growth. Economic uncertainty was a significant factor, as the pandemic had a more pronounced impact on the middle and lower-income segments of the population.
Promising Outlook
The outlook for luxury products such as smart toilets is highly promising, driven by increasing urbanization, rising disposable incomes, and growing awareness of hygiene and sanitation. Demand is likely to surge in urban centres, premium residential projects, and hospitality sectors. However, challenges such as high initial costs and the need for robust water and power infrastructure may require strategic interventions although with affordability improvements potentially expansion into middle-income segments is certainly a possibility in India. Moreover, the integration of advanced technologies such as IoT, water-saving features, and health monitoring systems aligns with the country's digital transformation and environmental sustainability goals.
Source: Himanshu Labroo & Shivansh Tiwari, BRG Research