Covid-induced restrictions are giving birth to innovative changes in China’s jewellery sector, including development of multi-channel online marketing, digitalisation and increased use of information technology.

Adhering to a strict zero-Covid policy amid a recent wave of cases, China has implemented severe lockdowns that heavily impacted many industries, including jewellery manufacturing and retail. 

Shanghai has since lifted lockdown restrictions.

The country’s National Bureau of Statistics said jewellery sales in March plunged 17.9 per cent year on year to RMB20.5 billion (around US$3.08 billion). Online retail, while thriving for a time, also faces logistical difficulties. 

Lai Zhiwei, vice president of Gems Jewellery Trade Association of China and general manager of Guangdong Jewellery and Jade Trade Center Co Ltd, said supply remains generally unaffected although timely delivery of goods and price increases are a challenge. 

Major retailers managed to diversify operations to stay afloat but middle- or lower-level enterprises were severely hit, especially by transportation and distribution restrictions in the third- and fourth-tier markets. 

The solution lies in changing the retail mindset and finding new ways to reach out to buyers, added Lai.

Several jewellery companies had already started realigning business strategies to include digital initiatives at the height of the pandemic in 2021. 

Yan Zhou, general manager of top jewellery manufacturer Shenzhen Xingguangda Jewelry Industrial Co Ltd, said, “Jewellers face greater pressure and challenges now, but it is also an opportunity to promote an in-depth integration between information technology and the industry. We are going deep into digitisation and intelligent manufacturing strategy.”  

Golston Jewellery, for its part, has been focusing on original designs and differentiating its goods from the mainstream market. “We are constantly looking for ways to develop our business in the new normal by opening up unconventional retail channels,” revealed Jenny Li, one of the founders of Golston.

Livestream sales, for instance, have achieved better-than-expected results over the past two years. “Everyone in the company does live broadcasting to sell more jewellery and connect to consumers as much as we can,” added Li.

Wang Huiqun, secretary-general of Shanghai Gold Jewellery Industry Association, said Shanghai is at the critical stage of recovery, aided by government-led initiatives. A rebound in the jewellery sector, however, could take time and be limited to demand for jewellery or gold bars for investment purposes.