Or at least that’s true if you are a Chinese bride and groom looking to make their marriage just that little bit more special. While wedding season hasn’t hit yet, gold jewelry still holds its own as one of the most popular choices. But not for Zhou Xiao and his wife, who are already shedding the traditional elements of Chinese weddings: rings, earrings, and necklaces. “It’s a smart choice—no extra fees and they maintain their value,” they said.
Shuibei is a community in Shenzhen of Guangdong province. The once hum-drum neighborhood has become a popular place for young couples to buy wedding gold at affordable prices. With the National Day holiday around the corner, the youth are thronging the shops to buy dragon-and-phoenix-shaped bracelets, necklaces, and other bridal jewelry. Shop owner Li Yang said business was busy ahead of the National Day holiday.
Though industry analysts have reported growing interest in gold for weddings despite higher gold prices, consumers in traditional Chinese culture, widely perceive the demand for wedding and gift jewellery as essential, while today consumers are more interested in cost-effectiveness.
Despite weak sales of gold jewellery this year, the World Gold Council predicted that gold will remain the leading force for China’s jewelry retail market, edging up to 66 percent by 2024, with a 59 percent share last year in 2020. Further, the share of gold in weddings is supposed to go up by 19 percent in 2022 to 24 percent by 2024.
But the WGC associates these statistics with no increase in demand. Its report says there is an overall slowing down of consumption of gold jewelry while consumers are settling for stable budgets for indispensable jewelry, like that for weddings. This behavior is adding to the increment in the share of gold in the overall sales of jewelry.
A general analysis both by the WGC and China Gold News has demonstrated that demand for wedding jewelry is indeed experiencing a shift. While, in the past, orders were mainly influenced by parental opinions, nowadays, it is mostly couples between 18 and 35 years old that have the final say about whether to buy wedding jewelry or not. The impact on marketing strategies of jewelry retailers will likely be very considerable.
Zijin Mining’s wedding gold brand, Zijin OG says this seems a consumption pattern shift by the new generations. This generation chases newness, unique experiences, self-expression, and personalized products, but is not averse to keeping abreast of the market trends. Entrepreneurs should, therefore, provide bespoke and premium services for effective engagement with this new generation of consumers.
“I purchase my gold bars at the bank instead of a hefty premium to a brand. For my marriage jewelry, I work closely with a designer to come up with something unique. Simple design usually runs between 10 yuan ($1.4) and 35 yuan a gram, thus it’s more cost-effective. I invest in gold to save for money, so in terms of small gold bars or nuggets,” said Zhou.
Zhou and his wife are one of the more and more popular young couples. Rather than buying a straight jewelry, many are collecting gold nuggets or bars, as these offer the best combination of the spot gold price with minimal labor cost. Once they get enough weight, they go to a workshop to melt and design it into their preferred styles. This way, they meet their needs for consumption while conserving the value of their investment by the rise of the price of gold.
As indicated by the report of the WGC, the market for gold jewelry is cautiously optimistic. A few stores are closing down because of too much competition and bad products, but there exist opportunities for market progression through the innovation of products and better digital marketing strategies.