The Chinese luxury jewellery category plummeted in the first quarter of 2020 due to the closure of stores and lockdown measures implemented by the government. Moreover, the Spring Festival and Valentine’s Day events, when luxury jewellery brands generally record a significant spike in sales each year, slumped in 2020 due to the pandemic.
Encouraging second-quarter sales helped luxury jewellery to weather the impact of the pandemic with further positive growth seen for the remainder of the year. After a challenging first quarter, luxury jewellery in China quickly capitalised on the reopening of stores in the second quarter, helping them to recover lost ground.
Demand for luxury jewellery among Chinese consumers did not cool due to COVID-19. In fact, in addition to a resurgence in demand, price rises by Bulgari and Dior have helped to offset unfavourable exchange rates and high raw material costs, which enabled them to compensate for the slowdown in quarter one volume growth to some degree.
E-commerce channels are experiencing growth thanks to luxury brands turning to this channel, which is leading to a boom in sales via luxury e-commerce platforms. For instance, Cartier officially launched its flagship store on Tmall in January 2020.
The luxury jewellery category is set to usher in new opportunities and potential after the pandemic recedes by appealing to the aesthetic demand of consumers led by young generations. While Chinese consumers have previously significantly preferred gold jewellery, Generation Z demonstrates strong interest in luxury jewellery made of metals other than gold.
Industry players are increasingly benefiting from the use of famous celebrities as brand ambassadors. For instance, Tiffany employs Jackson Yee, a top-tier Chinese male idol as its new brand ambassador.
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This report originates from Passport, our Luxury Jewellery research and analysis database.
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