{"id":6429,"date":"2024-02-21T16:53:00","date_gmt":"2024-02-21T11:23:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=6429"},"modified":"2026-06-01T19:52:48","modified_gmt":"2026-06-01T14:22:48","slug":"move-over-cars-japanese-and-koreans-are-now-entering-your-wardrobes","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/move-over-cars-japanese-and-koreans-are-now-entering-your-wardrobes\/","title":{"rendered":"Move over cars, Japanese and Koreans are now entering your wardrobes"},"content":{"rendered":"\n

Published in ETPrime<\/a>, 21 February 2024 <\/em><\/p>\n\n\n\n

Around two years ago, when Delhi-based Debabrata Bhattacherjee decided to explore a new brand for casual wear, he decided to give Uniqlo a try. The 27-year-old was so impressed by the quality that he became a regular customer of the Japanese fashion brand that had set foot in India in 2019.<\/p>\n\n\n\n

\u201cWhat first attracted me was the convenient design of their store, which was very organised and clean. Very Japanese, to say! The shopping experience is very hassle-free and offers a lot of options. Their clothes are very comfortable and the quality is excellent,\u201d said Bhattacherjee, a video producer. Though the brand is costlier than others, he is okay paying the premium.<\/p>\n\n\n\n

Bhattacherjee is among the many Indians who have contributed to the rising sales of Uniqlo. Also known to be Asia\u2019s biggest clothing brand, the Japanese company posted a 69% jump in sales in FY23 from FY22, with a net revenue of Rs 624.6 crore and a net profit of Rs 68.38 crore in India.<\/p>\n\n\n\n

Uniqlo is among a bunch of Japanese and South Korean brands that have, in the past couple of years, been gaining more space in the lifestyle and beauty product shelves of Indians. Wacoal, MUJI, Innisfree, Sulwhasoo and Amorepacific have been witnessing a relatively quiet but consistent growth in sales in the country.<\/p>\n\n\n\n

East Asian portfolio<\/strong><\/p>\n\n\n\n

Indian consumers are not new to the products from these countries. A popular example is automobiles: Suzuki, Hyundai, Toyota and Honda have made millions of Indians mobile. Now, fashion and lifestyle products from East Asia are also now becoming part of Indian households.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Anand Ramanathan, Partner and Leader-Consumer Products and Retail, Deloitte India, said this is because these brands have built a reputation for quality, design and durability \u2014 much like their peers in automobiles and engineering.<\/p>\n\n\n\n

East Asian lifestyle and beauty brands initially had an influence in the Northeastern states, where the customers are not only ahead of the curve in fashionability but also found resonance with the look of these brands, said Devangshu Dutta, founder and CEO of management consulting firm Third Eyesight. \u201cIn due course, K-dramas and K-pop (Korean popular culture) has boosted their expansion across the country. Japan and Korea are highly developed beauty and skincare markets, with customers who are conscious both about their appearance, as well as about the products\u2019 performance. These brands have established brand equity across markets on their quality, innovation, and product development,\u201d he said.<\/strong><\/p>\n\n\n\n

Indians have been enjoying the \u201cKorean wave\u201d or Haalyu, which refers to the global popularity of Korean culture, music, movies, and TV dramas. Ramanathan pointed out that Korean has emerged as the most learnt language among the 13-22 age group in India. Apart from fashion, he said, the cultural impact can be seen in food and jewellery options of Indian Gen Z and millennials.<\/p>\n\n\n\n

Well-travelled Indians who have been exposed to these brands find the pricing has \u201cvalue\u201d implicitly built in, Dutta added.<\/strong><\/p>\n\n\n\n

Companies from these countries also seem to find value in India. A 2023 survey by the Japan Bank for International Cooperation (JBIC) that collected responses from over 500 manufacturers in the island country showed that 48.6% of the companies considered India a key destination for medium-term business growth. Ramanthan cited a report by DPIIT that stated that since 2000, South Korea has invested $5.7 billion in India across various sectors. Recently, South Korea has invested $400 million in India during July 2022 to June 2023.<\/p>\n\n\n\n

E-commerce is a driver<\/strong><\/p>\n\n\n\n

Another brand on this list is Japan-based Wacoal. The lingerie maker entered India in 2015 with its first store in Mumbai, and has posted an impressive 3X year-on-year increase over the last eight years, said Pooja Merani, COO of Wacoal India.<\/p>\n\n\n\n

\"\"
Pooja Merani, COO of Wacoal India.<\/figcaption><\/figure>\n\n\n\n

This was because its products have adapted designs that align with the preferences of the Indian market, demonstrating cultural sensitivity, she said. The company measures the physique of approximately 1,000 women and girls between the ages of 4 and 69 every year, said Merani. This has helped it make clothes that suit Indians well. \u201cPrioritising fit and comfort in the offerings, and understanding the diverse body types in India, have likely contributed to customer satisfaction and loyalty,\u201d she said.<\/p>\n\n\n\n

South Korean beauty firm Amorepacific, which is the parent company of popular cosmetic brands such as Innisfree and Sulwhasoo, said they are seeing traction in India as the beauty and wellness industry is experiencing robust growth. \u201cThere is an increasing awareness and emphasis on skincare, with consumers seeking effective and high-quality products. India has a large and youthful population, and the youth are often early adopters of beauty trends. Korean skincare products, with their trendy packaging, innovative formulations, and youthful image, can resonate well with this demographic,\u201d said Mini Sood Banerjee, Assistant Director and Head of Marketing at Amorepacific Group.<\/p>\n\n\n\n

The company had last year signed an agreement with Reliance Retail to sell through its online fashion platform, Tira. Banerjee said 80% of its sales are through e-commerce. \u201cINNISFREE has been engaging with the Indian consumer much more rapidly in the online space.\u201d<\/p>\n\n\n\n

Uniqlo attributed its success to its blend of Japanese philosophy with Indian culture \u2014 the company started selling kurtas from 2019, when it had entered India through Delhi. A spokesperson credited the brand\u2019s success to the 13 brick-and-mortar stores in India focussing on its \u201cLifeWear\u201d philosophy. \u201cIt is simple, high-quality, everyday clothing with a practical sense of beauty that is ingenious in detail. This approach originates from the Japanese values of simplicity, quality and longevity \u2014 and we have seen that Indians appreciate the high level of quality of our apparel,\u201d the spokesperson said.<\/p>\n\n\n\n

Making in India<\/strong><\/p>\n\n\n\n

These companies have also started production in India, a sign that they find the market promising.<\/p>\n\n\n\n

Wacoal started its production in India last year, and is expanding into newer segments. The Uniqlo spokesperson said the company is on track to achieve 30% domestic sourcing. \u201cWe are actively growing local suppliers to deliver quality products for our customers. For example, we now work with 17 sewing factories and 6 fabric mills in India.\u201d<\/p>\n\n\n\n

\"\"
Amorepacific Group has found increasing awareness and emphasis on skincare, with consumers seeking effective and high-quality products in India.<\/figcaption><\/figure>\n\n\n\n

Fashion, home textiles and other home products are potentially the first categories where manufacturing within India can be explored, said Third Eyesight\u2019s Dutta. Brands with a large global footprint and established supply chains find it difficult to shift manufacturing bases.<\/p>\n\n\n\n

\u201cTo make a shift to India, a substantial volume of demand needs to be generated within the country, and brands also need to be actively looking to diversify from their existing supply bases. Fashion brands and retailers with product lines that are relatively less technical or complex, or for which the size of economically viable production base is relatively small, are already looking at manufacturing more products and greater volumes in India,\u201d he said.<\/p>\n\n\n\n

Foreign brands have to find the product-market fit to be successful in a country. India being an ethnically diverse market, the product-market fit can be dissimilar across the country. Brands can be successful only if they can address specific segments and build the business accordingly, Dutta added.<\/strong><\/p>\n\n\n\n

Companies like Wacoal said they are mindful of the cultural challenges. Merani pointed out how the lingerie market is predominantly unorganised and has challenges such as limited awareness about proper sizing and cultural taboos. \u201cOvercoming traditional industry norms and promoting accurate sizing awareness remains a persistent hurdle for us. Additionally, addressing diverse body types while ensuring top-notch quality further adds complexity,\u201d she said.<\/p>\n\n\n\n

\u2018Affluent India\u2019<\/strong><\/p>\n\n\n\n

Despite the challenges and the steep pricing, experts said these brands are becoming popular as Indians have more disposable income.<\/p>\n\n\n\n

According to a recent Goldman Sachs report that corroborated data using tax filings, bank deposits, credit cards and broadband connections, the affluent Indian consumer cohort has grown at a compound annual growth rate (CAGR) of over 12% in 2019-23, compared to 1% CAGR in India\u2019s population. Rising retail participation has lifted India market cap over 80%, it pointed out. \u201cThe largest beneficiary of rising \u2018affluent India\u2019 are categories such as leisure, jewellery, out-of-home food and healthcare, and premium brands within all categories,\u201d it added.<\/p>\n\n\n\n

The willingness of Indian customers to pay a premium price for better quality products depends on factors such as product category, brand reputation, target demographic and economic conditions, said Amorepacific\u2019s Sood.<\/p>\n\n\n\n

\"\"
Mini Sood Banerjee, Assistant Director and Head of Marketing at Amorepacific Group.<\/figcaption><\/figure>\n\n\n\n

For Japanese brands, the shift in India from electronics and automobiles to clothing and lifestyle is driven by strategic diversification and changing consumer trends. Japanese companies are leveraging globalisation and the increasing exposure of Indian consumers to international lifestyles, said Wacoal\u2019s Merani.<\/p>\n\n\n\n

\u201cEconomic factors, such as India’s growing middle-class population and economic growth, contribute to the attractiveness of the market. Thorough market research and understanding of local preferences, along with collaborations and partnerships, enable Japanese brands to align their products with the specific demands of the Indian consumer market. Overall, this shift reflects the adaptability and strategic decision-making of Japanese brands, indicating their confidence in the potential for success in diverse sectors beyond automobiles,\u201d she said.<\/p>\n\n\n\n

The Indian market still has legs.<\/p>\n\n\n\n

The COO of Wacoal India said the lingerie market, for one, would grow by a CAGR of 9.3%, especially as more young women join the workforce.<\/p>\n\n\n\n

India presents a great opportunity as a strong growing market. Even domestic brands are competing for \u201cshare-of-mind, shelf-space and share-of-wallet, and some larger Indian corporates are also backing their own brands and retail formats with strong investments,\u201d added Third Eyesight\u2019s Dutta.<\/p>\n\n\n\n

If the Japanese and Korean brands want to survive, they would need to keep innovating and adapting to consumer preference. For Indians, meanwhile, it is \u201cache din\u201d when it comes to shopping.<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

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