Shanghai— Office worker Dai Qingxiang, 28, recently faced a dilemma over purchasing gold accessories due to the precious metal’s soaring prices. However, encouraged by her friend Liu Nushi, she decided to buy the items at a jewelry store in Shanghai’s Xuhui district on a sunny May afternoon.
Dai’s hesitation was understandable given the recent surge in global gold prices. According to the World Gold Council, gold prices hit a record quarterly average of $2,070 per ounce in the first quarter, driven by robust investment from over-the-counter transactions, central bank buying, and increased demand from Asian buyers. This represents a 10 percent increase year-on-year and a 5 percent rise quarter-on-quarter.
Domestic gold demand in China also grew by 3 percent year-on-year in the first quarter, significantly higher than the average of the past decade. As young Chinese consumers turn to gold products over traditional investments, local Shanghai jewelry brands are seizing the opportunity to innovate in craftsmanship and product offerings.
Adapting to Demand
Shanghai Jinchenghuang, a time-honored brand established in 1934, has preserved gold jewelry-making techniques for four generations. Lin Zechao, general manager of Shanghai Jinchenghuang Industrial Group Co., emphasized that understanding consumer needs, upgrading craftsmanship, and targeted marketing are essential for maintaining market strength.
“Adapting to new trends while upholding quality standards is key for jewelry brands to remain attractive to Chinese consumers, regardless of their age, interests, or background,” Lin stated.
With East China as its core market, the company operates 300 retail outlets nationwide, focusing on the daily fashion needs of women aged 25 to 50. The brand differentiates between target markets, developing products based on systematic research into consumer preferences regarding style and design elements.
Smaller and hard gold accessories have proven resilient to market fluctuations, maintaining popularity among consumers. Lin reported a 30 percent year-on-year growth in gold bar sales in 2023, with expectations of continued growth this year.
Innovation and Consumer Preferences
“We’ve made annual investments in innovation, research, and development, including launching products that align with the latest consumer preferences,” Lin explained. Whether it’s 3D hard gold, heritage gold, or other innovative products, consumers are increasingly drawn to unique designs and advanced crafting technologies.
Wang Lixin, regional CEO with the World Gold Council of China, noted that hard-gold and heritage-gold jewelry saw outstanding sales in the first quarter, thanks to innovative designs incorporating gemstones and diamonds. Consumers tend to favor lighter, lower-priced products, Wang added.
In conclusion, as gold prices surge, jewelry companies are leveraging innovative designs and targeted marketing to attract consumers, particularly younger ones, thereby positioning themselves to benefit from the rising demand for gold products.
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