China’s young & trendy add a dash of gold
MURPHY Ma should be a gold miner’s dream — she’s young, trendy and has enough income to spend a few thousand yuan a year on jewellery. But this Chinese fashionista, like many others in their 20s and 30s, prefers white metal jewellery to gold — something promoters of the yellow metal are keen to change. As China’s economy booms, sales of gold sales have taken off. Rural women and workers in the cities have bought thicker, larger yellow gold earrings, and gold shop windows glitter with Buddha statues, Olympic memorabilia and cute pigs in solid gold. But it’s been a harder battle to reach young professionals like Ma, who prefer the cool glamour of platinum and a touch of individuality. “Before I thought gold was pretty pokey, something for grannies to wear. But now there’s K-gold and it’s becoming a little younger,” she said at a gold promotion soiree in a chic Beijing art warehouse on Wednesday, referring to a brand of gold aimed at the young and fashionable. In the drive to reach young Chinese, gold promoters have to combat a cultural preference for gold as a means to hoard wealth for hard times. China was one of the few countries in the world last year where gold demand was barely dented by a 25-year peak in prices. Gold jewellery demand fell by only 1% in 2006, compared with a 16% fall world-wide. Gold is often sold by weight in China’s department stores, and can be sold back for a small fee if prices rise or if the buyer needs some cash. The purity demanded by consumers who plan to re-sell the metal means pieces are often too soft to retain an intricate design. The focus on weight also means jewellers’ margins are too thin to justify spending on raftsmanship. But marketers have been making inroads with K-gold, which has a lower purity to support better designs and fatter margins for jewellers. K-gold accounted for 18% of jewellery sales in greater China in 2006, up from 15% in 2005. “K-gold has grown phenomenally, from 4 tonnes in 2004 to 44 tonnes in 2006,” said Thero Setiloane, executive director of marketing for AngloGold Ashanti, the world’s third-largest gold miner. One of the few miners to actively promote gold jewellery, AngloGold Ashanti has picked China as a focus area along with India, the Middle East, South Africa, and Brazil. Designers are also getting into the act, with glossy jewellery magazines and fashion shows. Designers like Zou Ningxin are trying to craft a look that will appeal to modern Chinese.
Courtesy: EconomicTimes
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