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China
By Julius Zheng
At midnight on February 9, the auspicious dragon wandered away, turning over the new Chinese Zodiac Year to the snake, sometimes called “the little dragon.” The snake is regarded as mysterious and cunning, quite intelligent and wise. Those born in the Year of the Snake are considered graceful people, exciting and dark at the same time. They are contemplative and private, and not outwardly emotional. In the business environment, they might appear cunning and reticent and work very modestly but they also are capable of plotting and scheming to achieve their goals.
Data recently released by Goldman Sachs showed that Chinese consumers spent a total of $46 billion on luxury products in 2012, of which $27.1 billion was spent overseas and $18.9 billion domestically. The company further predicted that the Chinese economy would grow at a rate of 8.1 percent in 2013, and that domestic spending on luxury products would continue to escalate, reaching $30 billion by 2015. A second report, this one from Bain & Co., a consultancy company based in the United States, concluded that Chinese consumers bought 25 percent of the world’s luxury products in 2012, and increased their overseas luxury consumption by 31 percent. The National Bureau of Statistics of China announced that the total retail of gold and silver jewelry in China in 2012 reached $35.5 billion, a 16 percent increase year on year. The Guangdong Bureau of Statistics also reported the total retail of gold and silver jewelry in 2012 was $2.92 billion in its province, an increase of 40.8 percent. Still, diamond trade has been difficult in 2012. Recently released data revealed that the total trading volume of the Shanghai Diamond Exchange (SDE) in 2012 was 75.12 million carats, a decline of 49.3 percent. The dollar trading value was $3.868 billion, a decrease of 17.8 percent from 2011, and polished diamond imports for the year totaled $1.581 billion, a drop of 22.2 percent. The Golden Week holiday of the Chinese New Year from February 9 through 15 is a prime season for family gathering, gifting and weddings. In 2013, the week also overlapped Valentine’s Day on February 14, a holiday that is becoming more popular in China and that offers additional retail sales opportunities. Diamond wholesale in China was quiet in the days leading up to the start of the Chinese New Year, as well as during the holiday, since retailers already had filled their orders and many wholesalers left early on vacation. On the other hand, retail business increased significantly toward the end of January. Both the retailers and wholesalers were anxiously awaiting the totals for the retail performance of 2013’s first Golden Week because 2012 was a difficult year for them. The retail numbers for the Chinese New Year affect dealers’ expectations for how the market will perform for the rest of the year and give them some insight into what they might expect from the industry’s first major trade show of 2013, the Hong Kong International Jewellery Show, that opens March 5.
Retailers always make an effort to promote their business before the Chinese New Year to capture gift-giving shoppers. This year, Blue Nile did exactly that on January 18, when it launched its official retail presence on Xiu.com, a shopping website, naming the site as its exclusive third-party online distributor in Mainland China. Chinese consumers may select from thousands of Blue Nile jewelry items ranging in price from $20 to $160,000, including gemstone, gold, silver, platinum and pearl accessories. Products for business professionals, such as cufflinks, business card holders, tie clips and key rings, also were offered. “Blue Nile has a strong and growing international presence, and the company has identified China as a core market in which to continue that growth,” said Vijay Talwar, Blue Nile’s president and general manager of international. “Cooperation with a leading Chinese luxury shopping site is an effective way to enter the Mainland China market.”
Because the symbol of the snake has much less glamour visually than
the dragon, and lots of people have a natural fear of snakes, this year’s snake motif designs are very commonly cartoon-style or abstract to make the snake appear more adorable. The representations are placed on Zodiac talisman jewelry, gold coins, bars and figurines. Lucky 12, the latest collection of Qeelin, the Hong Kong–based jewelry brand owned by Paris-based PPR Group, was also inspired by the Chinese zodiac. Special items for the Year of the Snake include rings and necklaces, made with gold and diamonds, priced at about $1,600. Meanwhile, the Italian brand Bulgari, which has been using snakes in its collections since the 1940s, has taken items from its previous collections featuring snakes and is displaying them in its China stores. Bulgari’s 2010 collection of watches also was named Serpenti, the Italian word for snake. The company is taking advantage of the many valuable potential marketing tie-ins in the Year of the Snake to promote its full range of serpent-themed jewelry.Article from the Rapaport Magazine - March 2013. To subscribe click here.
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