Rising Gold Prices Widen Losses... Domestic Jewelry Brands Also Raise Prices One After Another

Golden Dew to Raise Product Prices Starting March 17
Price Hikes Continue Amid Soaring Gold Prices and High Exchange Rates
Domestic Jewelry Brands Emphasizing Cost-Effectiveness... Sales Expected to Decline
Rising Popularity of Alternatives such as Lab-Grown Diamonds

As gold prices soar, domestic jewelry brands have followed luxury jewelry brands in raising their prices. With White Day on the 14th of next month and the spring wedding season approaching, jewelry product prices are rising one after another. Domestic jewelry brands, which have targeted consumers by emphasizing 'cost-effectiveness,' are concerned that price increases may lead to consumer attrition, so they are defending their performance by promoting alternatives such as 'lab-grown diamonds.'

According to the industry on the 27th, the domestic jewelry brand 'Golden Dew' will adjust consumer prices of its products starting from the 17th of next month. This is about seven months since the last adjustment in August last year. A Golden Dew representative explained, "The price adjustment varies by item depending on weight," and added, "The current rate of increase by item has not been finalized and is under discussion."

On the 18th, as gold prices soar and a shortage of gold bars occurs, all gold bar products on the monitor at the Jongno main branch of Korea Gold Exchange in Jongno-gu, Seoul, are marked as sold out. 2025.2.18. Photo by Kang Jin-hyung

Earlier, 'Didier Dubot,' operated by Sejung Group, raised prices of all products by 9% at the end of last year. 'Stonehenge,' operated by Woorim FMG, also started raising prices on some products from the 5th of this month. 'J. Estina' increased prices of jewelry products made with 14K gold by 10-15% last month. The jewelry brand 'Lloyd,' operated by E-Land, stated that it currently has no plans to raise prices.

Luxury jewelry brands had already raised prices earlier. 'Cartier' increased prices of all products sold domestically by about 5-6% on the 4th of this month, and the French luxury jewelry brand 'Tiffany & Co.' raised prices of some products by about 5% starting from the 5th. The French jewelry brand 'Fred' also raised prices of most products by 5-10% starting from the 17th. The domestic luxury jewelry brand 'MIKO' will increase product prices by 15-30% starting from the 17th of next month.

These price increases are due to the increased burden of raw materials caused by the recent surge in gold prices and high exchange rates. Gold prices, which traded around $2,000 per ounce at the beginning of last year, reached an all-time high of over $2,950 per ounce on the 20th (local time) due to intensified demand for safe-haven assets. The won-dollar exchange rate has also remained high, exceeding 1,400 won, following the martial law situation at the end of last year.

According to J. Estina's quarterly report, the cumulative operating loss in the third quarter of last year expanded to 1 billion won. The company posted an operating profit of about 2.8 billion won in 2022 but recorded a loss of about 200 million won in 2023, with the loss widening thereafter. This is due to the price of gold, the raw material, rising about 35% from 74,475 won per gram in 2022 to 100,821 won in the third quarter of last year.

"If gold prices rise, consumers don't buy jewelry"... Expanding product lines such as lab-grown diamonds

Jewelry, which is not a daily necessity, tends to be avoided by consumers during economic downturns. For this reason, domestic jewelry brands target consumers' wallets by emphasizing 'cost-effectiveness.' If prices rise, sales are likely to shrink.

Luxury jewelry brands typically raise prices once or twice a year and have a core customer base of high-net-worth individuals, so demand remains steady. However, domestic brands face relatively more consumers who react sensitively to price increases. An industry insider explained, "Domestic jewelry brands often emphasize cost-effectiveness by selling at relatively reasonable prices compared to luxury jewelry brands," adding, "If prices rise due to gold price increases, consumers are likely to leave."

Accordingly, some brands are focusing on increasing sales of silver products or securing product diversity. Didier Dubot is known to be strategizing to increase sales of other materials such as silver and brass after raising product prices at the end of last year. Lloyd, which mainly offered pure gold products, is expanding its product line centered on 'lab-grown diamonds' introduced in 2020. Lab-grown diamonds are diamonds produced by growing them in a laboratory (LAB). They have 100% the same composition as natural diamonds but cost only 20-30% of natural products, making them increasingly popular among consumers recently.