60 | JNA January/February 2023 MARKET INTELLIGENCE (around US$1,400). This suggests that consumers buying high-value diamonds prefer to view them in person first, but as trust in e-commerce grows, the gap in value may shrink. Of the consumers who bought diamond jewellery, 26 per cent of Gen Z shoppers first researched on social media – Red or Xiaohongshu, Douyin or Tiktok, WeChat moment or Weibo. In addition, 13 per cent of millennials and 8 per cent of younger millennials aged 24 to 30, looked up their potential purchases on shopping sites such as JD.com, Tmall and Taobao. In contrast, only 2 per cent of Gen Z shoppers checked out these e-commerce sites. Mega chains have also adopted the online-offline business model. Chow Tai Fook works with as many as 110 online platforms while operating 6,812 stores in mainland China. Branded and patented Branding plays a vital role in diamond jewellery sales in China. Most retailers carry their own brand, and sophisticated diamond jewellers even operate multiple sub-brands for their patented diamonds to cater to different customer segments. Shining House, a diamond jewellery retailer with around 500 stores in the country, relies on its distinctive diamond cuts to strengthen and distinguish its brand in the market. After the success of ROSACE, its patented and branded round cut with the most number of facets in round brilliant diamonds, the retail chain launched a new generation of patented octagonal diamonds, the Shining Star. The cut achieves a very high level of brilliance, sparkle, fire and light symmetry at the EX level, and has a special "4C+4EX" three-dimensional fire grading report from the International Gemological Institute (IGI). Shining House Chairman Winny Chun said, “The eight sides of the diamond represent courage, affection, commitment, forgiveness, responsibility, trust, eternity and gratitude, which embody the virtues favoured by different people.” More than a diamond cut, Shining Star is a business strategy that targets the high-end market. The product line has earned over US$15 million in annual revenue for one of the company’s flagship stores in Guangzhou. Over 200,000 customers have signed up with its Time Bank, a service for customers to express their commitment to loved ones. Looking forward While the trade is cautiously optimistic on business prospects in 2023, the performance of the country’s diamond market will depend primarily on the strength of economic recovery following the lifting of pandemic restrictions that had been in place for three years. Business may dip in the early months of 2023 since Covid-19 cases may rise as the country reopens. Diamond retail sales may not benefit from the Chinese New Year retail season, which falls in January this year, but an upturn is expected in spring. The Luxury Goods Worldwide Market Study released by Bain & Co and Altagamma Luxury Study in November 2022 stated, “China itself, which remains crucial to the longterm growth of the luxury market, continues to confront a challenging phase due to Covid lockdowns and is still performing below 2021 figures. China’s luxury market is expected to recover between H1 and H2 2023.” The report also revealed that mid- and high-income consumers in China increased by 180 million from 2014 to 2022. Before the pandemic, China’s jewellery market saw great strides in omnichannel sales, customisation, e-commerce and inventory management optimisation. Companies that survived the Covid-19 pandemic have adapted to the new normal. This year, most of China’s diamond jewellers intend to finetune their operations and engage the new generation of consumers. Sources: National Bureau of Statistics of China; Gems & Jewelry Trade Association of China; Shanghai Diamond Exchange *Key sampling involves jewellers with annual sales of RMB5 million (US$746,660) and above Note: Average exchange rate for US$ to RMB from January-November 2022 is 6.697 资料来源：中国国家统计局和中国珠宝玉石首饰行业协会 *重点调查年销售额在500万元人民币(74.6万美元)以上的珠宝商。 1-11月增长0.8% China’s jewellery and diamond market from 2016 to 2022 (January-November) in US$ billion 2016至2022年（1至11月）中国珠宝首饰和钻石数据 (单位：以10亿美元计) Year年 2016 2017 2018 2019 2020 2021 2022 (Jan-Nov) Total jewellery sales for key sample of jewellers* 限额以上企业零售总额 45.10 43.97 41.71 37.79 34.44 47.14 41.36 Total jewellery sales for all jewellers 全部珠宝企业零售总额 78.29 81.42 87.72 88.45 88.41 111.6 Not announced/ 未公佈 Total diamond jewellery sales 钻石珠宝零售总额 11.58 15.51 Not announced/ 未公佈 Polished diamond imports via the Shanghai Diamond Exchange 通过上海钻石交易所的成品钻进口金额 2.037 2.515 2.74 1.851 1.424 2.924 1.847
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