Reporter | Huang Shan
Edit | Lou Shuqin
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Recently, the parent company of Lao Feng Xiang Yin Lou revealed on the investor interactive platform that the company tried to set up Lao Feng Xiang theme brand stores, including theme stores such as "Feng Xiang Happy Event" representing wedding celebrations, aiming to "gradually form a new image and new pattern of Lao Feng Xiang's market." ”
In fact, Lao Fengxiang opened its first theme store in Shanghai at the end of 2021. Located in lane 8 of the historic commercial center of Shanghai's Hongkou District, this store features the concept of "treasure gold" as the theme of the store.
A corner of Lane 8 of this dynasty Image source: The Paper
"Treasure gold" refers to an ancient gold casting process that has been passed down in China for thousands of years. Starting from 2020, when Promoting its gold jewelry, Lao Fengxiang will focus on promoting the "treasure gold" process, emphasizing the brand's cultural advantages in the field of gold and silver production technology.
For example, the "Embroidery Style" series of jewelry launched by Lao Fengxiang in the third quarter of 2020 uses the "treasure gold" process. Lao Fengxiang positioned this series as a "national tide jewelry" at that time. In the new "Fengxiang Happy Events" series launched in 2022 exclusively for the wedding market, Lao Fengxiang also emphasized the "treasure gold" process on social media such as Xiaohongshu and WeChat public accounts.
Image source: Screenshot of Little Red Book
Perhaps many people do not know that Lao Fengxiang was born in 1848, and has the same long history as the French fine jewelry brand Cartier Cartier, which was born in 1847. However, the two have different positions in the contemporary jewelry market. Cartier is a cultural symbol of fine jewelry art, while Lao Feng Xiang is more regarded as a retailer of gold and gold jewelry for the mass market, although it does master the ancient gold casting process.
Now, with the soaring demand for gold jewellery in the local market and the east wind of the national tide, Lao Fengxiang emphasizes that the ancient gold craft culture also reflects the brand's attempt to show its cultural advantages. In addition, Lao Fengxiang's marketing strategy is also changing to scenarios. For example, the "Fengxiang Happy Event" theme store mentioned by Lao Fengxiang Company is foreseeable to emphasize gold jewelry in the wedding scene.
Image source: Lao Fengxiang
However, how Lao Fengxiang will show the new look of the brand through different theme concept stores is currently unclear. According to the pictures of the Lao Feng Xiang 8 Lane Treasure Gold Concept theme store shared by netizens on social media, the visual design and store display in its interior are not much different from ordinary Lao Feng Xiang brand stores.
It is worth noting that Lao Fengxiang is highly dependent on wholesale channels, which may weaken the efforts of brand image upgrading.
According to The 2021 Performance Express of Lao Feng Xiang, the number of marketing outlets of Lao Feng Xiang will reach 4945 by the end of 2021, including 16 overseas silver buildings, a net increase of 495 for the whole year.
The number of Lao Feng Xiang's global stores is about to exceed the 5,000 mark, the vast majority of which are opened by franchisees. According to Lao Fengxiang's 2020 financial report, Lao Fengxiang's marketing outlets reached 4450 at the end of 2020, of which 4270 franchise stores. At the end of 2019, Lao Feng Xiang had a total of 3893 marketing outlets and 3709 franchise stores. It is not difficult to see that the number of Lao Fengxiang's self-operated stores has not increased but declined in the past, and the brand has become more dependent on franchise stores.
Lao Fengxiang "Fengxiang Happy Events" series Image source: Lao Fengxiang
Relying on franchisee Lao Fengxiang to expand the sinking market in the past many years. However, the poor management of some sinking market franchisees has had a negative impact on the brand image of Lao Fengxiang.
Interface fashion saw on the Little Red Book that many consumers complained that Lao Fengxiang stores had problems such as "pit people at a price", "old for new to fool old customers", "poor shopping guide attitude" and so on. During the 3.15 period of this year, there were Henan media reports that Lao Fengxiang originally promised that customers could exchange bracelets for "one price" in the future, but adjusted the policy to be priced by grams in the middle of the way, which caused consumer dissatisfaction.
Although many consumers have also responded on the Little Red Book, Lao Fengxiang's directly operated stores rarely have the above problems. However, the number of Lao Fengxiang's directly operated stores nationwide is less than 200, and the lack of control over a large number of franchisees is bound to form a resistance to its improvement and upgrading of brand image.
One of Lao Fengxiang's competitors, Hong Kong's Chow Tai Fook Group, has also focused on opening up the sinking market Chinese mainland in the past two years, and its dependence is also on franchisees.
In releasing its first half of 2022 report, Chow Tai Fook said it plans to add about 1,000 Chow Tai Fook jewelry retail outlets Chinese mainland in FY2022. Considering that the retail sales points of Chow Tai Fook Jewelry in the first half of the financial year have exceeded 4,700 in the reporting period, it is expected that the retail sales points of Chow Tai Fook Jewelry will also reach about 5,000 throughout the year.
Unlike Lao Fengxiang, Chow Tai Fook's goal this year is to keep the proportion of franchised stores and self-operated stores between 70% and 30%. This means that the number of Chow Tai Fook directly operated stores is expected to be around 1500, and these are mainly concentrated in the first and second-tier cities in the mainland, which are the key markets for Chow Tai Fook's solid brand image.