Multiple factors slow sales growth
Jewelry retail continued to benefit from China's growing affluence, but several factors contributed to sluggish sales, including: slower economic growth, government policies discouraging extravagant official gift giving, and increased overseas Chinese tourism.
Chinese traditionally view precious jewelry as both a status symbol and an investment that holds its value even during periods of inflation. But costume and fashion jewelry are growing in popularity among young professionals, especially men.
Local brands benefit from this trend by offering relatively affordable jewelry in contemporary designs made with less expensive materials. Meanwhile, international jewelry retailers derive competitive strength from branding, design and quality.
Although store-based retailing continues to dominate jewelry sales, because consumers prefer to try on the merchandise, Hong Kong jewelers have started to incorporate ecommerce aggressively, even offering exclusive online designs.
Mainland Chinese jewelry retailers have yet to fully embrace ecommerce, however brands like Lao Feng Xiao integrate the online channel by providing detailed product and store information on their websites. Ming Jewelry built its official online shop on Tmall.com.