The Hong Kong-listed jewellery retailer on Thursday revealed its ambitions to transform its business and operations in the next five years to “set the course of the group’s future” and drive growth.
Group vice-chairman Sonia Cheng Chi-man said the upgrades, of which the cost has not been disclosed, would set the stage for its centenary celebrations in 2029.
“In the face of rapidly evolving consumer preferences, our strategy at Chow Tai Fook Jewellery is not just to adapt, but to lead,” she said. “We are paving the way towards our centennial by sculpting our legacy into a beacon of modern jewellery and cultural resonance, ensuring that every piece that we craft is as timeless as the heritage we carry forward.”
Among the major shake-ups will be the introduction of a revamped logo and website, with the group’s nearly 8,000 mainland, Hong Kong and Macau stores set to be renovated to showcase the new brand identity.
The brand’s flagship 2,800 sq ft space on Queen’s Road in Central will finish its makeover by the third quarter.
A five-storey shop, measuring 8,600 sq ft, on East Nanjing Road in Shanghai is expected to be unveiled in early 2025 as its mainland flagship.
Fresh features will be added to Chow Tai Fook’s website, with planned improvements to the online shopping experience as it looks to further tap into a growing e-commerce market.
The group said the new design would combine its history with a “forward-looking” identity, while maintaining classic and timeless elements.
Vice-chairman Conroy Cheng Chi-heng, a cousin of Sonia Cheng, said a focal point of the transformation was retaining craftsmanship, one of its main assets.
“We make sure our jewellery appeals to our customers’ modern tastes while staying true to our roots,” he said.
Hong Kong Jewellery Manufacturers’ Association honorary chairman Benny Do Yuen-ling said Chow Tai Fook’s push to evolve its business strategy made sense.
No Easter joy for Hong Kong retailers as trade group warns of tough times
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“The market has changed drastically over the years, the spending patterns and appetite of consumers are no longer the same as before,” he said.
“Younger consumers tend to shop on their smartphones or online rather than in-person in stores. So 10 years ago, retailers focused on expanding retail networks, a strategy which may not be applicable now.”
But some analysts pointed to the uncertain macroeconomic environment both in Hong Kong and on the mainland as cause for concern. The mainland accounted for 82 per cent of Chow Tai Fook’s HK$49.5 billion (US$6.3 billion) in sales in the six months to September 30 last year.
Brokerage Nomura Asia said Chinese retail sales figures were weaker than expected, adding that rising gold prices had affected related sales.
Hong Kong retail sales grow 16.2% in 2023, bouncing back from contraction
Hong Kong retail sales grow 16.2% in 2023, bouncing back from contraction
Growth in gold, silvery and jewellery sales on the mainland slowed to 3.2 per cent year on year in March, down from 5 per cent in January and February combined, the brokerage said.
Chow Tai Fook said in its latest financial statement that it felt the chill of macroeconomic headwinds in the first quarter.
It reported same-store sales of gem-set jewellery declined 27.2 per cent year on year in Hong Kong and Macau between January and March. On the mainland, same-store sales of gem set, platinum and K-gold jewellery shrank 19.5 per cent in the first quarter compared with the same period last year.
Same-store sales refer to revenue from existing shops that have been in operation for a certain period of time.