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Fading blonde? When the "Chinese aunt" no longer grabs gold...
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Do you still remember a few years ago, the circle of friends always brushed up on the "achievements" of "Chinese aunts" bravely entering major gold stores? As soon as the price of gold rose, they ran faster than anyone else, shot generously, and couldn't wait to empty the counter's momentum, which is still fresh in people's memories
Feng Shui takes turns, once hot gold jewelry, but now it seems that the scenery is no longer good, walking into the mall, in front of the jewelry counter that was once full of people, but now it seems a little deserted, even the industry giant Chow Tai Fook has begun to decline...
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Dismal performance! Chow Tai Fook also ushered in a "cold winter"?
Chow Tai Fook released the operating data for the first quarter of fiscal year 2024, this report card, can be described as "bleak", the data shows that between April and June this year, Chow Tai Fook's sales in Chinese mainland fell by 186% year-on-year, and in Hong Kong, Macau and other markets fell by 288%, you know, this is the largest gold jewelry chain in China, once created countless sales myths of the "gold giant", but now it has also fallen into the performance quagmire, which is really embarrassing
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What's more worrying is that Chow Tai Fook's same-store sales have also fallen off a cliff, in the second quarter of this year, Chow Tai Fook's same-store sales in the Chinese mainland market fell by 264%, and in Hong Kong and Macau, it fell by more than 30%.
Close the store and stop the loss! Why did the expansion of the past come to an abrupt halt?
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In the face of such a severe market situation, Chow Tai Fook also began to adopt the strategy of "breaking arms to survive", the financial report shows that from April to June this year, Chow Tai Fook closed 91 stores in Chinese mainland, if you add the net decrease of 89 stores from January to March this year, Chow Tai Fook closed a total of 180 stores in Chinese mainland in half a year
You must know that for a long time in the past, Chow Tai Fook has been actively expanding, and the number of stores once exceeded 7,000, covering major cities across the country, but now it has to slow down the pace of expansion, and even began to close stores on a large scale, the reasons behind this are worth pondering
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As for the reason for the closure of the store, Chow Tai Fook explained in the financial report that this is due to the continuous impact of the economic environment on consumption, coupled with the high price of gold, which has led to the impact of domestic demand for gold jewelry
Inventory is in short supply! Why is no one caring about the once "hot goods"?
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In addition to closing the store, Chow Tai Fook also made a shocking decision to close the Beishan factory in Shenzhen, which is an important production base for Chow Tai Fook and is responsible for the production of a large number of gold jewellery
According to people familiar with the matter, the current inventory is seriously overstocked, even if it is not produced, it is enough for more than 7,000 chain stores to sell for 2 years! This is not alarmist, but a true portrayal of the oversupply of gold jewelry market, once, gold because of its value preservation and appreciation attributes, regarded as "hard currency", with the diversification of investment channels, the investment attributes of gold gradually weakened, coupled with the change of consumption concepts of the younger generation, the attractiveness of gold jewelry is not as good as before
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Consumption downgrade! Why is gold jewellery "not just needed"?
In the context of consumption downgrade, the first thing consumers cut is often the category of non-rigid needs, and jewelry belongs to this category, for most people, only when they get married will they visit jewelry stores, and they rarely buy gold jewelry
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In recent years, the number of domestic marriages has continued to decline, data show that the number of domestic marriages reached a peak of 134.69 million couples in 2013, then declined for nine consecutive years, and fell below 10 million couples in 2019, until last year, it rebounded, and the decrease in the number of marriages directly led to a decline in demand for gold jewelry
The consumption concept of the younger generation is also changing, compared to gold jewelry, they prefer personalized and fashionable jewelry, such as diamonds, colored gemstones, etc., in their opinion, gold jewelry style is old, lack of fashion sense, difficult to show personality
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Where is the road to gold jewelry?
In the face of such a predicament, how can the gold jewelry industry break the situation? Stick to tradition or actively transform?
Perhaps, gold jewelry companies should rethink their own positioning, from product design, marketing model and other aspects of innovation, in order to regain the favor of consumers, can develop more in line with the aesthetics of the younger generation of fashion styles, or the launch of personalized customization services to meet the diversified needs of consumers
Gold jewellery companies can also try to expand new sales channels, such as online sales and live streaming, to reach consumers in a more flexible way
The gold jewellery industry is facing unprecedented challenges, but challenges and opportunities coexist, and I believe that as long as companies can actively seek change and continue to innovate, they will be able to find a new direction of development and regain their former glory
Do you think there is a future for the gold jewellery industry? Feel free to leave a message in the comment area to share your views
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