Specialist
Retail Operations at Chopard Trading (Shanghai) Co Ltd
Agenda
- China’s luxury jewellery market competition in market share and annual sales and competitive barriers of leading jewellers (Cartier, Tiffany and others)
- Non-jewellery brands’ (LV and others) foray in to the luxury jewellery market and potential growth
- Comparison of Cartier and competitors’ store productivity, operations, expansion strategies and cooperation with shopping malls
Questions
1.
China’s jewellery market started to feel the pinch before 2014 with initial slowdown in sales growth for all luxury jewellery brands as a result of declining marriage rate. Analysts say sales of bridal and wedding jewellery decreased with changes in the perception of diamonds. Euromonitor International projected 6.3% down for the jewellery market valued at USD 60bn in 2016 and expected the trend to continue into 2022 as the fever for luxury jewellery is waning. Can you give us an overview of China’s luxury jewellery market in 2018 including the market size and growth?
2.
Fewer consumers buy jewellery for wedding. How many customers buy jewellery for wedding, themselves and others?
3.
What’s the respective share of Cartier, Tiffany and Bvlgari in the first-tier cities? How about their growth in recent years?
4.
The sales of Cartier in China are the total of Tiffany and Bvlgari combined. Is that the result of a huge difference in the number of stores?
5.
You mentioned that Tiffany began to introduce products for the younger generation and sell on Alibaba’s “Luxury Pavilion” platform in China since last year. It also launched products for daily use such as silver ball of yarn. What do you think of its moves?
6.
Tiffany’s move to Alibaba’s “Luxury Pavilion” platform and launch of Paper Flower are all steps further to appeal the young. How do you evaluate the strategies and effectiveness of similar efforts of brands like Cartier and Bvlgari?
7.
Tiffany announced in 2018 that it would introduce new series every 1-2 years instead of its traditional frequency of 3-4 years to the pursuit of freshness of the young on top of its preference in celebrity branding, marketing and design you shared earlier. What are the considerations of traditional luxury jewellery brands like Cartier, Bvlgari and Van Cleef & Arpels in product designs?
8.
Apart from those we talked about earlier, are there any other high-end jewellery brands that may register rapid growth in China in the future?
9.
Chaumet and Boucheron operate under the banner of LVMH and Kering Group, respectively. In Q3 2018, LVMH generated about EUR 3bn in sales revenue from watches and jewellery, an increase of 8% on an annual basis. The performance of Bvlgari was particularly eye-catching. Its market share increased notably. LVMH operates multiple jewellery brands, including Chaumet and Fred, right?
10.
Earlier you mentioned that brand jewellery makes up only 25% of the whole market and non-brand jewellery 75%. The market for brand jewellery is still a blue-ocean one. Kering Group announced that its Gucci will roll out high-end jewellery lines in 2019. It also said that it will provide more support to Boucheron in 2019. Why do luxury companies shift their focus to jewellery in 2018-19?
11.
Can you compare traditional high-end jewellery brands, including Cartier and Tiffany, and jewellery brands operated by luxury companies such as LVMH in terms of user persona?
12.
Let us take a look at sales channels. Tiffany has started to cooperate with Tmall. Will other jewellery brands explore online channels in the future?
13.
Can you talk a little about the duty-free policies of luxury jewellery brands in China? Will the building of duty-free stores in cities such as Beijing and Shanghai fuel their sales growth?
14.
Richemont’s sales revenue grew by 20% in the Asian-Pacific region in Q3 2018. The region also contributed the most to revenue in Richemont, the proportion reaching 37%. Can Cartier and other brands under Richemont maintain sound growth in 2019?
15.
Non-jewellery brands have also entered the high-end jewellery sector. In Q3 2018, Hermès Jewellery, Art of Living and Hermès Table Arts performed strong and the sales revenue grew by 20.9% YoY. Except for jewellery, will the high-end household goods segment also explode in the luxury product market?
16.
In 2018, in Paris, Louis Vuitton, a high-end French jewellery brand, released its new collection of high jewellery, Conquêtes, which vividly combines the two iconic symbols of the house, that is, the letter V and the monogram flower. In 2019, it has pushed out the collection of Conquêtes Regalia, which consists of seven sets and around 60 pieces of jewellery. What is your comment on performance of Louis Vuitton in high-end jewellery in the past few years?
17.
Louis Vuitton released its high jewellery collection in 2018 and Gucci also claimed to do that in 2019 to compete with Louis Vuitton. Which brand do you think will perform better in the high-end jewellery sector?
18.
The strengths of high-end jewellery brands are brand awareness, quality of raw materials and craftsmanship. Is that correct?
19.
What is your comment on performance of Chanel or Dior in accessories such as earrings, necklaces and rings in 2018? How about that in 2019?
20.
Chanel may remain promoting accessories but Dior is likely to release its high-end jewellery series. What is your comment on Dior’s performance in the high-end jewellery sector in the past few years?
21.
Is there anything else you want to share with us?
