As the Hong Kong Trade Fairs get under way, all eyes are on the Chinese retail market and their largest contingent of diamond consumers – the Millennials. Since 2015 luxury jewelers have noticed a growing demand for diamonds by Chinese millennials, aged 18 to 34, who are altering the perception that diamonds are only a symbol of love to be received when getting engaged, married or for an anniversary. Changing lifestyle trends and the evolving urban culture have led young consumers to deviate from China’s traditional preference of gold and jade, and have instead incorporated diamond-studded jewelry to be part their daily wear, the new normal in fashion.
Chinese millennials now account for nearly 70% of China’s diamond sales, according to research by De Beers, worth $6.76 billion last year, a figure much higher than other comparable markets. Among the buyers are women with white-collar jobs, who on average spend 10,000 yuan ($1,458) per diamond jewel. Whether it is a ring, necklace or earrings, diamonds have become symbols of achievement and social status.
Trends: Design, brands & experiences
Rather than the size of diamonds, this segment is more concerned with the design, as it affords them their own individuality. "They care more about the piece being fashionable and whether it matches their daily wear. Besides, they care about brands like Tiffany & Co, Cartier and Chow Tai Fook," said Cao Wei, chief executive of Beijing-based Gemoiselle Jewelry.
In an effort to attract young women to their stores, Hong Kong’s Lukfook Jewelry experimented with the idea of ‘Retailtainment’, a marketing technique that adds an element of entertainment to the retail experience. They intend to set up nail-care areas in some of its mainland stores, and hire good-looking bus drivers to take millennial women straight to their shopping destinations. According to the Shanghai Diamond Exchange, the top priority is to popularize the value of diamond as a rare natural gem through sustained consumer education.
"Young Chinese women are fond of fashionable commodities. So, our company will produce more customized jewelry in the future, and set the price at a relatively affordable level," said Wang Ensheng, manager of the marketing department at Shanghai Laofengxiang. "This way, they can buy more accessories for different occasions." Similarly, Tiffany&Co. have made specific categories of products priced lower than US$500 and US$250. By doing so they are able to appeal to a wider range of younger consumers who, once they have made their initial diamond purchase, will likely continue to do so. According to Tiffany, the number of products that are priced below US$500 are growing at a double-digit rate.