Hong Kong's jewelry retailers are adapting to shifting market trends through innovative products, digital strategies, and strategic branding. While the region has yet to recover fully from pre-pandemic levels, the jewelry market demonstrates resilience as retailers explore ways to grow amidst economic uncertainties.
Sales Trends and Economic Impacts
The jewelry market started 2024 on a strong note, with sales from January to February increasing by 8.8% year-on-year, reaching HKD 10.2 billion ($1.3 billion). However, optimism faded as sales dropped by 12.8% in the first half of the year, totaling HKD 26.5 billion ($3.4 billion).
Major retailers attribute the slowdown since April to soaring gold prices, which have made consumers more cautious. As of August 13, 2024, gold prices hit a record $2,471.55 per ounce, according to the World Gold Council (WGC).
Despite the temporary impact of high gold prices, the demand for gold jewelry remains strong due to its inherent value, investment potential, and innovative designs.
Johnny Chau, Director and Deputy General Manager of Chow Sang Sang, remarked, “Amid economic uncertainties and fluctuating stock and property markets, consumers turn to gold as a safe haven. Strong gold jewelry sales continue to support overall market growth.”
Similarly, Kent Wong, Managing Director of Chow Tai Fook Jewelry Group, highlighted findings from their 2023 Jewelry Consumption Trend Report, which showed that 64% of Gen Z consumers purchase pure gold jewelry for self-reward or daily wear, indicating a broader appeal beyond cultural or investment considerations.
Modern Gold Jewelry Takes Center Stage
To meet the growing demand for gold jewelry in Hong Kong and mainland China, jewelers are launching new collections that combine advanced technology and creative designs.
Recent advancements, such as 5D and 5G hard gold manufacturing, allow for greater design flexibility, enabling artisans to create unique, modern pieces suited for daily wear.
Luk Fook Holdings has capitalized on these innovations, introducing lighter, more stylish options. Nancy Wong, Executive Director, noted, “24K gold can now be paired with diamonds, rubies, emeralds, and other gemstones, making designs more versatile and fashionable.”
Chow Tai Fook’s Heritage Collection, launched in April 2024 to celebrate the brand’s 95th anniversary, integrates traditional Chinese symbols of good fortune with modern aesthetics. The signature red tone in the collection was developed in collaboration with the Pantone Color Institute, reflecting a fusion of tradition and contemporary design.
Digital Transformation and E-Commerce Growth
The pandemic accelerated the digitization of the jewelry market, and Hong Kong retailers have embraced e-commerce and social media strategies to expand their reach.
- Luk Fook increased its presence on platforms like Xiaohongshu (Little Red Book) with targeted influencer marketing campaigns. Wong explained, “This is an effective way to connect with potential customers in China. It allows us to gather valuable feedback and continuously improve.”
- Chow Sang Sang leveraged digital channels to tap into overseas markets, particularly targeting Chinese buyers accustomed to online shopping. According to Chau, “Online sales now account for nearly 20% of total sales in mainland China, with a significant portion coming from regions where we lack physical stores.”
- Chow Tai Fook uses data from customer interactions to enhance product management and optimize operations. Wong stated, “We analyze transaction data to plan production, match products with store locations, and predict future trends.”
Strategic Branding for Sustainable Growth
Branding has emerged as a key driver for growth among Hong Kong jewelers. Chow Sang Sang’s Chau explained, “Our core strategy is product series differentiation. Effective marketing highlights the unique value of our products, helping customers make informed choices.”
Luk Fook has also adopted sub-brand strategies for its top-performing collections, opening specialized boutiques to target specific customer groups. Wong remarked, “Instead of saturating premium shopping malls with Luk Fook stores, we launch sub-brands to cater to niche markets.”
Chow Tai Fook embarked on a rebranding initiative in 2024, unveiling a new logo and packaging to align with evolving customer expectations. As part of its strategy to prepare for the brand’s 100th anniversary in 2029, the company plans to renovate all stores, aiming to enhance the customer experience through modern displays and personalized shopping journeys.
Adapting to Market Challenges
Hong Kong jewelers remain cautious about rapid expansion. Both Chow Tai Fook and Chow Sang Sang are focused on optimizing their existing retail networks and improving operational efficiency. This includes evaluating store performance and aligning product offerings with regional preferences.
Despite current challenges, Hong Kong jewelers remain optimistic about the future, fueled by the resilience of the local market and growing demand from mainland China.