Diamonds Are A (Chinese) Girl's Best Friend
These fine jewelers and more are committed to "telling the affluent mainland Chinese all about it." According to our study of high net worth mainland Chinese fine jewelry buyers, Tiffany's still rules with 27.4% of respondents reporting that this was the most recent brand purchased. This was followed by Cartier at 13.7%, Bulgari at 10.7%, Follie Folli at 10.7% and Christian Dior at 7.1%.
The Chinese love jewelry and see it as an investment vehicle. They consider investing in jewelry as "saving for a rainy day." Jing Daily reported that, "Over the past several years, demand for diamonds has soared throughout mainland China as diamond engagement rings have become a "must" for young couples, luxury consumption has surged, and wealthy urbanites have started to see the precious stones as good "portable investments."
According to Jing Daily, in 2009, China surpassed Japan to become the world's second-largest diamond market. While the U.S. is still the market leader, accounting for 38% of total diamond consumption, according to Bruce Cleaver, CCO of De Beers, China, along with the Middle East and India, will collectively account for 40% of global diamond consumption.
Our study showed that the mainland Chinese are not afraid to spend. Nearly 56% of respondents said that they had purchased two or more pieces of fine jewelry within the past 12 months.
It is worth it for retailers to invest in acquiring these consumers as they are incredibly brand loyal. The study showed that almost 70% of respondents cited that they owned more than three pieces by the brand that they most recently purchased.
This behavior has caused many fine jewelry brands to aggressively pursue the Chinese, both in mainland China but also in the U.S. Tanger Malls and Chelsea Malls recently released data that showed Zales Outlet store comps increased a whopping 11.5% and 13.7% respectively in the month ending June 30. These impressive gains were attributed to Zales' focus on attracting mainland Chinese tourists.
The Chinese love a deal. In our study, 57.3% of high net worth mainland Chinese fine-jewelry buyers said that they would buy more if offered a discount. The Tanger and Chelsea outlet malls are perfectly positioned to appeal to the Chinese. In addition to already offering great deals on branded merchandise, many of the stores are empowered to provide additional savings thereby enabling the mainland Chinese customer to satisfy their need to bargain.
The mainland Chinese are eager to buy fine jewelry. Retailers can capitalize this by focusing their marketing efforts to attract them to their stores and offer gifts and/or discounts to leverage conversion. The cost of a customer acquisition program will be paid out as the brand can expect this customer to purchase at least two additional pieces.