China Jewelry Industry Development Trend

Jewelry refers to the raw materials and semi-finished products of jewellery and precious metals, as well as wearing jewelry, craft ornaments and art collections made of raw materials and semi-finished products of jewelery and precious metals. According to the Classification and Code of Jewelery and Precious Metal Products issued by the National Standardization Administration in 2010, jewelery and jade are defined as “the collective name of natural jewelery and artificial gemstones”, while precious metals are defined as “gold, silver and platinum group metals”. The collective name."

Jewelry from the material points mainly include: diamonds, precious stones, gold, platinum, silver, pearls, jade, crystal, jade, agate, coral, amber, glass, etc.; from the functional points mainly include headwear, earrings, necklaces, Chest ornaments, waist ornaments, jewelry, foot ornaments, gold and silver jewellery, Tibetan jewelry/ethnic jewelry, mobile phone accessories, jewelry accessories, jewelry raw materials, jewelry packaging and skin care products, and other jewelry accessories.

According to the general business practices at home and abroad, jewelry is divided into five categories: 1 gemstone jewelry, 2 precious metal jewelry, 3 pearl jewelry, 4 semi-precious stones jewelry, 5 artificial jewelry. The first three categories are precious jewels.

At the recent China Jewelry Industry Innovation Forum, Yang Shisan, vice president of the China Jewelry Industry Association, pointed out that in the next ten years, the overall demand for Chinese jewellery will grow at a rate of 15%-30%, and the market potential in the future will be greater. At present, the entire domestic jewelry industry is also facing the lack of innovation in the market and channels, and the products are more similar. And, with the spending power of young consumers such as the 80s and 90s, jewelry companies will also need to upgrade their brands. “Now some consumers are no longer satisfied with the classic jewellery culture of love tokens. They hope that jewelry can express more updated emotional appeals.”

Insiders say that in the past, jewellery companies made money regardless of whether they sold or not, because the price of gold has been rising. Premiums on products and premiums on materials can support profits. In recent years, due to the political and economic environment, especially the continuous decline in the prices of gold raw materials, the jewellery retail industry has been hit harder than ever.

For the future direction of the jewelry industry, industry sources said that townships and e-commerce have great opportunities. Moreover, in the current jewellery and jade market, the concept of the brand is being gradually blurred, and the buyer's demand for jewellery and jade is more customized, personalized and refined.

Hong Kong jewellery in shopping sacred sites is still not ideal

According to the statistics of the Hong Kong SAR Census and Statistics Department, the estimated value of total retail sales in Hong Kong in March 2016 was HK$34.7 billion, a year-on-year decrease of 9.8%, of which the most significant fall was in jewellery, watches and clocks and valuable gifts. Declined by 20.3%, clothing category decreased by 11%, department store products fell by 5.4%, electrical appliances and photographic equipment fell by 20%, miscellaneous durable consumer goods fell by 38.2%, auto and auto parts fell by 8%.

1. China's jewellery consumer market is huge. Among them, gold jewelry is taken as an example. According to the statistics of the China Gold Association, China's gold consumption demand was about 986 tons in 2015. Gold consumption in the jewelry industry accounts for 73% of the entire gold consumer market, and is simply calculated at current gold prices (without considering gold jewelry relative to gold). The increase in the price of the entire gold jewelry market exceeds 180 billion. From a growth point of view, the sharp decline in gold prices in 2014 led to a 25% year-on-year decrease in gold consumer demand, of which gold jewellery prices only fell 7% year-on-year; as gold prices gradually stabilized, gold consumption increased by 11% year-on-year in 2015, gold jewellery The use of gold increased by 8% year-on-year. Gold jewelry has two attributes: consumption and investment (finance). Looking ahead, with the increase in the per capita income level of residents in our country and the expected global monetary easing, it is expected that the consumption of gold jewellery, investment coins and commemorative gold bars will continue to grow.

2. As another major category of jewelry, the overall consumer market for diamonds is closely related to the economic cycle. With the rise of the middle class and the increase in demand for diamond investment, it is expected that the demand growth of the diamond market will remain between 5% and 10%. In 2014, China’s annual diamond demand was approximately RMB 62.0 billion, accounting for 12% of the global market, second only to the United States (US$ 37 billion). In 2008-2013, the growth rate of China's diamond jewellery consumption has maintained a double-digit growth. In 2014, due to the slowdown in macroeconomic development and the slowdown in the Hong Kong market (1% to 2% of global market share), the growth rate slowed, but it still reached 6%.

In recent years, the demand for diamonds in China has mainly benefited from the increase in the number of middle-class and higher-income groups. At present, the number of middle-class adult population in China has reached 204 million (a per capita wealth of 139,000 US dollars), ranking first in the world. From 2015 to 2020, the combined growth rate of the upper class and the wealthy will reach 17%. This will become the main demand for diamonds.

The investment attributes of diamonds have also continued to increase. In recent years, the cumulative increase in the prices of international diamonds has exceeded 150%, especially among investment-grade diamonds. According to data from the British Diamond Manufacturers Association, the annual investment return rate of a 5 carat diamond in the past 5 years was 12%. In the past few decades, the average price of diamonds rose by an average of 5-7% annually.

China Jewelry Industry Development Trend

1. The rapid rise of e-commerce has made traditional offline jewelry stores increasingly subject to shocks. Massive information presentation, convenient online payment, and increasingly sophisticated and secure logistics packages have enabled consumers to begin to form online jewellery consumption habits. In this context, traditional mainstream jewelry brands rely on open platforms such as Tmall, Jingdong and Suning to create online channels. At the same time, many emerging Internet brands continue to emerge, and jewelry e-commerce is gradually emerging.

2. In the purely physical business model of the traditional jewellery industry, products have entered the hands of consumers after undergoing such links as the purchase of raw materials, design of designers, production and processing of processors, and distributors of distributors. There is a lack of effective links between the entire industry chain. Communication of information, designers can not accurately capture customer needs in a timely manner, and vendors can not get the product information of many processors. Jewelry is a product with a low degree of standardization and high consumer demand. The asymmetry of information causes products to fail to reflect consumer demand in time, and product homogeneity is serious. Under the O2O model, companies collect customer information through the Internet, grasp consumer perceptions in advance based on consumer preferences and needs, provide information to the upstream through C2B, connect product production, and achieve upstream and downstream information flow, and at the same time solve the problem. Downstream raw material purchases and finished product purchases have the problem of capital deposits, and the effective integration of industry resources has been achieved.

3. 15-60-year-old female consumer groups accounted for 33% of the total population, about 480 million people, including young and fashionable and economically capable women aged 25-45 accounted for 16% of the total population; young fashion consumers nearly 300 million people , which accounts for 16% of the total population, this part of the female consumer willingness is strong, and there is enough income to support their spending power.

The jewellery industry is expected to reach a market space of RMB 1,100 billion by 2019. The demand for jewelry such as diamonds is 37% (approximately RMB 400 billion). Diamonds have a vast market for future development. The amount of diamond imports in China has increased year by year. At the same time, the proportion of the middle class in China will increase from 19% in 2012 to 44% in 2023. The total number of households will increase from 82 million in 2012 to 216 million, and the rise of the middle class will increase. Effectively driving the consumption of diamonds continues to grow substantially.

4. The formation and structural changes of the jewellery consumer market have a lot to do with the economic development of a region and the renewal of consumer attitudes. It is positively related to the living standards of a region and the speed of accepting new things. The demographic structure is the same as the social and cultural environment. Affects the concept of jewelry consumption and the consumption of jewelry. In 2014, with the looting of the effects of gold grabbing, the continued decline in international gold prices and the slowdown in domestic inflationary pressure have made the importance of gold jewelry as a domestic household's investment protection channel. The importance of gold jewelry has declined significantly, and the market will return to meet more consumers. The demand for psychological needs and emotional values, the future industry highlights will focus on wedding needs after 80-90 wedding tide (planned purchase), festive birthday and self-wearing needs (personalized and impulsive buying), The differentiation of the industry structure brings a lot of challenges and opportunities to traditional jewelry companies.

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