(IDEX Online) - The first PGI Insight report by Platinum Guild International (PGI) reveals a shift in the platinum jewelry industry to a consumer-centric business model in China with pioneering players seeing improvement in business.
PGI Insights offer an in-depth focus on key market trends in the global and regional platinum jewelry industry. Through this first report, PGI understands that a successful business model transition will enable the platinum jewelry industry to further capture new demand among different demographics and segments in order to compete within the existing jewelry market ecosystem. Based on the findings of the recent Platinum Jewelry Business Review (PJBR 2017) survey, a number of retailers in the platinum jewelry industry have made strategic changes to better engage with Chinese consumers and improve retail margins. With enhanced competitiveness, those market players are in a more favorable position to expand their platinum jewelry business to other segments, beyond wedding occasions where platinum is the dominant precious metal. There exists the potential for 350,000 ounces of incremental demand from bridal jewelry in lower tier cities, and 270,000-ounce incremental demand from capturing just 10% of post-bridal gifting in China. According to the PGI Insight report, based on understanding consumers' attitudes and desires, platinum jewelry marketing can be more targeted, while also helping the industry to move towards piece-based pricing for more value-added products. Platinum jewelry accounts for approximately 70% of China's platinum demand, with around 12 million pieces sold each year. Unlike Japan, the US, and Europe, 80% of platinum jewelry in China is still in the form of plain and unbranded products. As China's new consumers increasingly look for distinctive designs, and retailers demand better margins, this generic business model needs to shift. "We are seeing that consumer preferences are changing very fast and the industry cannot rely on out-dated designs and homogenous products in a day and age where design driven branded collections hold more value. PGI is working with the platinum jewelry industry to accelerate the transition and regain the momentum of growth. We have seen some great successful stories, demonstrating such changes not only meet the evolving needs of Chinese jewelry consumers, but also deliver real economic benefits to our partners, with a growing share of platinum business in their product portfolio, " said PGI CEO Huw Daniel.