LFX, the company’s initials, can also stand for the lucky and fashionable phoenix. Gold, which represents luck and fortune, holds great meaning in Chinese culture, so Lao Feng Xiang has tied its brand to 24K gold jewelry for many years.
In the 1920s and 1930s, Lao Feng Xiang made strong inroads by marketing their 24K gold jewelry, 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 jewelry.
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 jewelry 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 center, jewelry company, jewelry research institute, jadeite company, jadeite carving factory, design center, jewelry 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 recognizes 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 jewelry 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 jewelry based on brand name value rather than shopping for the lowest price.
In China, as in the West, jewelry is viewed as a luxury product, especially among younger consumers. The company is expanding internationally.
Products and Designs
According to marketing manager Ensheng Wang, China’s entire retail jewelry industry has seen a shift in consumer preferences. While Lao Feng Xiang was built primarily on the sale of pure gold jewelry, they have seen solid growth in jewelry based on design rather than the value of raw materials. Although pure gold is still one of its best sellers, the company has greatly expanded its range of jewelry products over the past ten years. Lao Feng Xiang now also carries diamond jewelry, colored stone jewelry, souvenirs, and even gemstone-mounted precious-metal eyeglass frames.
“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 jewelry suite reflects their origin, development, and evolution.
One of Lao Feng Xiang’s jewelry 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 honored. It won a gold prize at the 2010 “Tiangong Yiyuan” Boutique jewelry 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 jewelry piece with traditional Chinese meaning.
Lao Feng Xiang designers strive to keep traditional elements in many of their designs. They often incorporate the color red, a color 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 emphasize 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 jewelry 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, jewelers 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 modeling, while others used hand fabrication. There were also stations for stone setting.