Lao Feng Xiang:
China’s Time-Honoured Jeweller
October 24, 2014
In the 1920s and 1930s, Lao Feng Xiang made strong inroads by marketing their 24K gold jewellery, decorations and special-occasion gifts to Chinese officials and wealthy customers. Today, many people in Shanghai dream of owning a piece of Lao Feng Xiang jewellery.
The Brand and the BusinessLao Feng Xiang is listed in “China’s 500 Most Valuable Brands” by the World Brand Lab. In 2012, the company’s ranking rose from 197th to 166th among the major Chinese brands. Its filigree technique has been designated an Intangible Cultural Heritage of China by the government.
Lao Feng Xiang’s sales are some of the highest among Chinese jewellery retailers, exceeding 25 billion yuan (US$4.21 billion) in 2012. The company has had steady double-digit sales growth over the past 12 years, and its brand value has risen from 7.565 billion yuan (US$1.216 billion) to 11.672 billion yuan (US$1.876 billion). The company’s overall structure includes a diamond manufacture centre, jewellery company, jewellery research institute, jadeite company, jadeite carving factory, design centre, jewellery manufacture factory, silverware factory, souvenir factory, pawn business and auction house. It is publicly traded on the Shanghai Stock Exchange, giving the brand greater exposure and providing access to capital for further expansion.
Lao Feng Xiang’s headquarters are in Shanghai, and there are more than seventy stores in that city alone. The company has over 2,000 retail and boutique stores all over mainland China. Lao Feng Xiang recognises the growing interest in China and Chinese-inspired designs in the global marketplace. To that end, in 2012 they opened their first overseas store in Sydney, Australia. This September, they are scheduled to open a flagship store in Manhattan. Lao Feng Xiang has also ventured into TV shopping and Internet sales, aimed specifically at the younger generation, as well as very high-end marketing for elite and upwardly mobile customers. At the same time, they pay attention to enhancing their retail stores and the customer experience.
Lao Feng Xiang markets to a wide customer base in China, reaching out to the younger generation and to older, more traditional jewellery buyers. Due to the price range of their products, they can market to a variety of consumers. The company’s philosophy is to avoid price wars and focus on building their brand, quality, value and customer relations. Lao Feng Xiang has found that consumers buy jewellery based on brand name value rather than shopping for the lowest price.
In China, as in the West, jewellery is viewed as a luxury product, especially among younger consumers. The company is expanding internationally.
Products and Designs
“The Glamour of Chinese Characters” is one of Lao Feng Xiang’s award-winning designs. Chinese characters make up a written language with profound cultural meaning, and the jewellery suite reflects their origin, development and evolution.
One of Lao Feng Xiang’s jewellery designs, “Elegant”, won an international prize in the 1980s. The design was inspired by flowing silk scarves fluttering in the wind. Made of karat gold and diamonds by Zhang Xinyi, one of the nation’s youngest arts and crafts masters, it was the first Chinese piece to win an international prize.
Another interesting piece is “Hua Kai Fu Gui”, meaning rich and honoured. It won a gold prize at the 2010 “Tiangong Yiyuan” Boutique jewellery design competition. Its inspiration came from the peony, loved by the Chinese people and representing prosperity and wealth. Lao Feng Xiang mounted a large emerald in it to make a fashionable high-end jewellery piece with traditional Chinese meaning.
Lao Feng Xiang designers strive to keep traditional elements in many of their designs. They often incorporate the colour red, a colour that is beloved in Chinese culture. This is accomplished by using ruby, rubellite tourmaline, red coral or even non-gem materials. For example, designers created “China Red” during the 2008 Olympic Games to emphasise classic Chinese culture and seize the moment of global exposure. Another masterpiece is “Harmonic Couple: Luan and Phoenix”, inspired by an old Chinese fairy tale. Luan and the phoenix are birds of ancient Chinese tradition, and they make a good pair.
The FactoryLao Feng Xiang’s jewellery design and manufacturing facility is also located in Shanghai. The first thing the GIA team noticed was that the designers there were highly focused on their work. The shop was full of creative energy and passion. They were studying themes including nature, architecture, popular culture and Chinese traditions. They worked with hand drawings and paintings as well as computer-aided design. There were numerous sketches of high-end pieces laden with gemstones as well as simpler pieces aimed at different price points and a wider market.
In the manufacturing division, jewellers were producing the company’s designs through hand fabrication as well as wax carving and casting. They often worked directly from the sketches provided by the designers. Some work stations focused on wax modelling, while others used hand fabrication. There were also stations for stone setting.
SummaryOur trip to the Lao Feng Xiang retail store, headquarters and factory afforded a view of a company with rich traditions and history that has moved successfully into the modern market and now looks to expand globally. It mimics much of what our 2013 expedition to China revealed about the country’s jewellery industry. We witnessed a skilful blend of traditional jewellery styles and practices coupled with rapid growth into new products to meet modern consumer preferences. Lao Feng Xiang is deeply rooted in Chinese culture while successfully navigating the changing market in China and the rest of the world.
Dr Tao Hsu is a technical editor of Gems & Gemology. Mr Andrew Lucas is manager of field gemmology for education at GIA in Carlsbad, California.
GIA staff often visit mines, manufacturers, retailers and others in the gem and jewellery industry for research purposes and to gain insight into the marketplace. GIA appreciates the access and information provided during these visits. These visits and any resulting articles or publications should not be taken or used as an endorsement.
The authors would like to thank the management and staff of Lao Feng Xiang and their Nanjing Road store in Shanghai for allowing us to interview them and film in their store and jewellery manufacturing facility. We would also like to thank Mr Shuyun Zhang, the coloured stone manager of Lao Feng Xiang, for providing us with many photos. Special thanks go to Prof. Shouguo Guo and Mr Xiaobo Lang for arranging the trip and acting as our interpreters.