Gen Z shapes the future of China’s diamond market

Editor’s note: This story is part of Jing Daily’s latest report, Diamonds Reimagined: How China’s New Generation Redefines Luxury Through Self-Fulfillment. Download the report to unravel the intricate market trends, consumer behaviors, and economic drivers propelling the natural diamond sector towards sustained growth. While millennials remain the primary buyers of diamond jewelry in China, contributing around two-thirds of all diamond sales by value, the younger Gen Z cohort is emerging as a transformative force in the industry. This generation, characterized by its unique preferences and behaviors, is redefining how diamonds are perceived and purchased. Understanding Gen Z’s distinct characteristics is crucial for stakeholders aiming for long-term success in the diamond market. Here are the top diamond trends among China’s youngest luxury cohort: Self-purchasing trends in China’s diamond market A significant shift in China’s diamond market is the rise of self-purchasing, particularly among women. This trend reflects a broader cultural and economic shift toward individualism and financial autonomy. Women are increasingly buying luxury items for themselves rather than waiting to receive them as gifts. The proliferation of e-commerce platforms has facilitated this change, making luxury goods more accessible and encouraging frequent self-indulgence. Social media and advertising campaigns emphasizing personal satisfaction and quality of life have significantly influenced consumer behavior. On platforms like Xiaohongshu, discussions about “self-satisfaction consumption” (悦己消费) have surged, indicating a cultural shift towards independent luxury purchases. This trend challenges the traditional view of diamonds as symbols of commitment, positioning them instead as personal rewards or investments. Gen Z’s influence on design and purchasing decisions The PCG Consulting Agency’s 2023 Gen Z Luxury Consumption Trend Report highlights that over 40% of Gen Z consumers buy luxury items as self-rewards during holidays. Product design significantly influences their purchase decisions, with more than 30% prioritizing aesthetics. Diamonds are increasingly seen as symbols of personal achievement and style, with a notable preference for everyday wear. According to De Beers Group’s Diamond Insight Report 2023, Gen Z values self-expression, competitiveness, and optimism. They view diamonds as symbols of personal strength and achievement, with nearly two-thirds endorsing this perspective. This generation’s preference for distinctive and symbolic diamond cuts, such as heart-shaped diamonds, reflects a desire for personalized luxury consumption. The expanding male jewelry market The trend of self-purchasing in China also includes men, challenging traditional views of jewelry as predominantly feminine. Influenced by younger celebrities embracing diverse styles, more Chinese men are buying jewelry for themselves. This nascent market represents a significant opportunity for luxury diamond brands. Quiet luxury: Quality over quantity A notable trend in China’s luxury market is the rise of “quiet luxury,” which emphasizes refined elegance and quality over ostentation. This concept prioritizes craftsmanship, premium materials, and sustainability, resonating deeply with consumers. Branded diamond jewelry has gained traction, with 92% of purchases in 2023 attributed to recognized brands, a substantial increase from 44% in 2016. Chinese brands account for nearly 80% of these sales. Brands that align with consumers’ values and cultural preferences are well-positioned to thrive. The incorporation of cultural heritage into designs enhances brand resonance and authenticity. Personalized services and bespoke pieces epitomize the essence of quiet luxury, reinforcing diamonds’ timeless value. The divergence of natural and lab-grown diamonds The market for lab-grown diamonds is expanding, driven by increased production capacity and technological advancements. These diamonds appeal to price-conscious consumers and are gaining popularity in the fashion segment. However, natural diamonds continue to hold greater value for many consumers. A 2023 survey by Chow Tai Fook found that 74% of Chinese consumers regard natural diamonds as more premium and luxurious. Digital transformation and ethical considerations The digital realm is becoming crucial for diamond jewelry purchases in China. Gen Z leads this trend, with a high comfort level with online transactions. Omnichannel retailing strategies and emerging technologies like virtual try-ons can enhance the online shopping experience. Ethical considerations are increasingly important to Chinese consumers, especially Gen Z. The proportion of consumers willing to buy non-ethically sourced diamonds has declined, highlighting the growing importance of sustainability. Brands that invest in eco-friendly initiatives and transparent sourcing practices will likely resonate with the youngest consumer cohort. By understanding and adapting to these evolving trends, stakeholders in the diamond industry can effectively cater to the dynamic preferences of Gen Z, ensuring sustained growth and relevance in China’s luxury market.

Gen Z shapes the future of China’s diamond market

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Published June 24, 2024

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Gen Z shapes the future of China’s diamond market