{"id":110,"date":"2025-06-14T12:22:43","date_gmt":"2025-06-14T04:22:43","guid":{"rendered":"https:\/\/aiwiselnk.com\/?p=110"},"modified":"2025-06-14T12:41:54","modified_gmt":"2025-06-14T04:41:54","slug":"startup-commentarytenfold-returns-in-a-year-is-laopu-the-hermes-in-the-gold-industry","status":"publish","type":"post","link":"https:\/\/aiwiselnk.com\/index.php\/2025\/06\/14\/startup-commentarytenfold-returns-in-a-year-is-laopu-the-hermes-in-the-gold-industry\/","title":{"rendered":"Startup Commentary&#8221;Tenfold Returns in a Year: Is Laopu the &#8220;Herm\u00e8s&#8221; in the Gold Industry?&#8221;"},"content":{"rendered":"\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"781\" height=\"665\" src=\"https:\/\/aiwiselnk.com\/wp-content\/uploads\/2025\/06\/7b6895d479157f6536caab3c9bcc2025_a7ad76c18efd9f3119c9f497e442b3c9_interlace1.jpg\" alt=\"\" class=\"wp-image-112\" srcset=\"https:\/\/aiwiselnk.com\/wp-content\/uploads\/2025\/06\/7b6895d479157f6536caab3c9bcc2025_a7ad76c18efd9f3119c9f497e442b3c9_interlace1.jpg 781w, https:\/\/aiwiselnk.com\/wp-content\/uploads\/2025\/06\/7b6895d479157f6536caab3c9bcc2025_a7ad76c18efd9f3119c9f497e442b3c9_interlace1-300x255.jpg 300w, https:\/\/aiwiselnk.com\/wp-content\/uploads\/2025\/06\/7b6895d479157f6536caab3c9bcc2025_a7ad76c18efd9f3119c9f497e442b3c9_interlace1-768x654.jpg 768w, https:\/\/aiwiselnk.com\/wp-content\/uploads\/2025\/06\/7b6895d479157f6536caab3c9bcc2025_a7ad76c18efd9f3119c9f497e442b3c9_interlace1-670x570.jpg 670w\" sizes=\"auto, (max-width: 781px) 100vw, 781px\" \/><\/figure>\n\n\n<p><a href=\"https:\/\/36kr.com\/p\/3334828198881798\">Read More\u300a\u4e00\u5e74\u5341\u500d\uff0c\u8001\u94fa\u771f\u662f\u9ec4\u91d1\u754c\u201c\u7231\u9a6c\u4ed5\u201d?\u300b<\/a><\/p>\n<p><strong>Positive Reviews: The Business Model Innovation of Laopu Gold Redefines the \u201cLuxury\u201d Path of Gold Consumption<\/strong><\/p>\n<p>Against the backdrop of domestic consumption downgrade and the cooling &#8211; off of high &#8211; end luxury brands, Laopu Gold has defied the odds with a ten &#8211; fold increase in its stock price in one year and a compound revenue growth rate of 157% (from 2022 to 2024), becoming the gold jewelry enterprise with the highest market value in the Hong Kong stock market. Its success is not accidental. By precisely breaking through the pain points of the traditional gold jewelry industry and deeply exploring the \u201cluxury &#8211; oriented\u201d path, it has opened up a new track for differentiated growth in the gold consumption market.<\/p>\n<h3>I. The \u201cFixed &#8211; price\u201d Model Breaks the Industry&#8217;s Involution and Reconstructs the \u201cEmotional Value\u201d of Gold Consumption<\/h3>\n<p>The traditional gold jewelry industry has long been trapped in the low &#8211; profit dilemma of \u201cpricing by weight\u201d. Since the price of gold raw materials is transparent (anchored to the Shanghai Gold Exchange (SGE) price), it is difficult for brand owners to increase profits through cost control. Moreover, the homogenization of product design (such as zodiac &#8211; themed and \u201cgood &#8211; luck\u201d themed \u201ccommodity &#8211; like\u201d products) makes consumers more concerned about the hedging property, which ultimately leads to \u201ca race to the bottom in processing fees\u201d &#8211; the average gross profit margin of the industry is only about 15%, and brands can only rely on channel expansion (opening franchise stores) to maintain growth.<\/p>\n<p>Laopu&#8217;s \u201cfixed &#8211; price\u201d model completely subverts this logic. All its products (pure gold and pure gold inlaid products) are priced by piece, directly incorporating added values such as craftsmanship, design, and culture into the price. The gross profit margin is stable at around 40% (far higher than the 15% of traditional weight &#8211; priced gold and the 35% of the industry&#8217;s \u201cfixed &#8211; price\u201d products). More importantly, this model strengthens the \u201cemotional value\u201d by downplaying the investment property of gold. Consumers are no longer buying \u201ca hedging metal\u201d but an \u201cemotional carrier\u201d that embodies ancient craftsmanship, Buddhist culture, and a sense of blessing ritual.<\/p>\n<p>Take the pure gold inlaid products launched in 2019 as an example. By combining pure gold with gemstones, enamel, and jade, it enhances the visual hierarchy and design premium. The gross profit margin of these products is 8% &#8211; 10% higher than that of the pure gold series. Currently, they account for over 60% of the total, becoming the core driving force for Laopu&#8217;s profitability. This strategy of \u201cproduct differentiation + premium pricing\u201d not only breaks away from the \u201craw material trading\u201d logic of traditional gold jewelry but also upgrades gold from a \u201ccommodity\u201d to a \u201ccultural consumer product\u201d.<\/p>\n<h3>II. The Pure Direct &#8211; operation Model Controls High &#8211; end Channels, and Scarcity Shapes the Image of the \u201cHerm\u00e8s of the Gold Industry\u201d<\/h3>\n<p>Traditional gold jewelry brands rely on franchise expansion (over 90% of the stores of Chow Tai Fook, Lao Feng Xiang, etc. are franchises). Although this can quickly increase the quantity, it is difficult to control the terminal pricing and service quality. Problems such as low &#8211; price cross &#8211; regional sales and false promotions occur frequently, hindering the brand&#8217;s transformation to the high &#8211; end market. In contrast, Laopu adopts a pure direct &#8211; operation model, strictly controlling the number of stores (only increasing from 18 to 36 in the past five years) and concentrating on top &#8211; luxury shopping malls in first &#8211; tier and new first &#8211; tier cities (such as SKP and Mixc), neighboring LV and Herm\u00e8s.<\/p>\n<p>This strategy of \u201copening fewer but larger stores\u201d essentially replicates the \u201cscarcity operation\u201d of luxury goods. By controlling the supply (such as limited &#8211; edition products and price increases for classic styles) and providing a scenario &#8211; based experience (service standards in high &#8211; end shopping malls), it strengthens the brand&#8217;s \u201chigh &#8211; end style\u201d and \u201cmystery\u201d. Data shows that in 2024, the average revenue per store of Laopu reached 330 million yuan, approaching the global average of 380 million yuan per store of Herm\u00e8s, making it the \u201cking of single &#8211; store revenue\u201d. More notably, 85% of its growth comes from the improvement of the efficiency of existing stores rather than the opening of new stores, indicating that consumers&#8217; acceptance of the premium under the high &#8211; end positioning continues to increase.<\/p>\n<h3>III. Cultural Empowerment Builds a Differentiated Barrier, Transforming from a \u201cCollectible Brand\u201d to a \u201cTop New &#8211; consumption Brand\u201d<\/h3>\n<p>Laopu&#8217;s predecessor was \u201cGolden Treasure\u201d, which dealt in Buddhist cultural products. This genetic background has deeply bound it to \u201cculture\u201d since its inception. Its products integrate ancient craftsmanship (such as engraving and fetal &#8211; like metalworking) with Buddhist culture (scenarios like blessing and fortune &#8211; turning). In the early days, it targeted high &#8211; net &#8211; worth collectors as its core audience, accumulating brand recognition for \u201ccraft scarcity\u201d and \u201ccultural value\u201d. After independent operation in 2016, Laopu did not abandon this advantage but instead transformed it into \u201cemotional resonance\u201d in the mass market. Through narratives such as \u201cancient craftsmanship is cultural inheritance\u201d and \u201cgold carries blessings\u201d, it has upgraded its products from \u201cornaments\u201d to \u201cspiritual symbols\u201d.<\/p>\n<p>This cultural empowerment not only solves the problem of \u201chomogenization\u201d in gold consumption but also precisely meets the needs of the new consumption era. Young consumers (especially Generation Z) are no longer satisfied with \u201cpractical functions\u201d but pursue \u201cmeaning\u201d and \u201cidentity recognition\u201d. Laopu&#8217;s success essentially lies in binding \u201cgold\u201d with \u201cculture\u201d and using emotional value to offset the impact of consumption downgrade.<\/p>\n<p><strong>Negative Reviews: Under Laopu&#8217;s \u201cLuxury Fa\u00e7ade\u201d, There Are Still Shortcomings in Brand Awareness and Anti &#8211; cyclical Ability<\/strong><\/p>\n<p>Although Laopu shows the potential of being the \u201cHerm\u00e8s of the gold industry\u201d in terms of business model and operational efficiency, its current high growth and high valuation are still facing multiple doubts. From the controversy of \u201cancient craftsmanship being a rip &#8211; off\u201d to \u201cfake luxury\u201d, it essentially points to core issues such as insufficient brand depth and weak anti &#8211; cyclical ability.<\/p>\n<h3>I. The Brand Awareness Has Not Reached the \u201cCore Essence\u201d of Luxury, and the Sustainability of the Premium Is Questionable<\/h3>\n<p>True luxury brands (such as Herm\u00e8s and Cartier) have three core characteristics: global recognition (transcending regional cultures), classic designs (ever &#8211; green best &#8211; sellers), and hard &#8211; currency attributes (pricing is not affected by raw materials or economic cycles). Currently, Laopu has only achieved the \u201cfa\u00e7ade\u201d:<\/p>\n<p>Firstly, brand recognition is limited to the domestic market. Laopu&#8217;s cultural narratives (Buddhist culture and ancient craftsmanship) are highly dependent on the context of Chinese traditional culture and have not yet formed a globally resonant brand symbol. It is difficult for it to break through regional limitations like Herm\u00e8s&#8217; \u201cBirkin bag\u201d or Cartier&#8217;s \u201cBallon Bleu\u201d.<\/p>\n<p>Secondly, there is a lack of cross &#8211; era classic designs. Although Laopu&#8217;s products emphasize craftsmanship, the designs are still mainly focused on scenarios such as weddings and blessings, and it has not yet launched iconic single products like Cartier&#8217;s \u201cLOVE series\u201d that can span the aesthetic cycle. Its price &#8211; increase logic mainly relies on \u201cthe complexity of craftsmanship\u201d and \u201citeration of popular series\u201d rather than \u201cthe absolute authority of the brand logo\u201d.<\/p>\n<p>Thirdly, pricing is still restricted by the nature of gold. Although Laopu tries to downplay the investment property of gold, its inventory accounts for nearly 70% of its total assets (mainly gold raw materials), and its profitability is still strongly correlated with gold price fluctuations. During the gold price increase cycle from 2022 to 2024, Laopu&#8217;s gross profit margin was stable at 40%. If the gold price falls or fluctuates in the future, its premium ability may be tested.<\/p>\n<h3>II. The Gap between \u201cLuxury &#8211; oriented\u201d Marketing and the Actual Value May Trigger the Controversy of \u201cRip &#8211; off\u201d<\/h3>\n<p>Laopu&#8217;s high premium (the price per gram of its products is more than 30% higher than that of its competitors) is based on the narrative of \u201cancient craftsmanship + cultural value\u201d. However, some consumers believe that the premium for its craftsmanship lacks perceptible differentiation. For example, traditional gold jewelry brands (such as Chow Tai Fook and Chao Hong Ji) are also promoting technologies such as 3D hard gold and gold + enamel. Although Laopu&#8217;s \u201cancient craftsmanship\u201d has historical inheritance, it is difficult for ordinary consumers to intuitively distinguish the technical barriers between it and other technologies.<\/p>\n<p>More importantly, the essence of the premium of luxury goods is \u201cbrand belief\u201d rather than simply \u201ccraft cost\u201d. The high price of Herm\u00e8s&#8217; Birkin bag is mainly due to the \u201cstatus symbol\u201d represented by the brand, rather than the cost of leather and hand &#8211; sewing. Currently, Laopu&#8217;s premium is still supported by \u201ccraft + culture\u201d. If consumers think that its cultural narratives are \u201cmore hype than substance\u201d (such as the superstitious elements of \u201cblessing\u201d and \u201cfortune &#8211; turning\u201d being regarded as marketing gimmicks), it may lead to the fermentation of the \u201crip &#8211; off\u201d controversy, which will in turn affect the repurchase rate and brand reputation.<\/p>\n<h3>III. The Expansion Bottleneck of the Direct &#8211; operation Model May Cause the Growth Ceiling to Appear Prematurely<\/h3>\n<p>Although Laopu&#8217;s pure direct &#8211; operation model ensures brand tone and store efficiency, it also limits the speed of scale expansion. Currently, it has only 37 stores globally, and they are concentrated in top &#8211; luxury shopping malls in first &#8211; tier and new first &#8211; tier cities. The store resources in such high &#8211; quality business districts are scarce (for example, there are only more than 10 SKP stores nationwide), and the space for future new store openings is limited.<\/p>\n<p>Currently, 85% of Laopu&#8217;s growth comes from the improvement of the efficiency of existing stores. However, if the efficiency per store approaches the level of Herm\u00e8s (330 million yuan vs. Herm\u00e8s&#8217; 380 million yuan), the room for further improvement will narrow. If it cannot drive growth through both \u201cstore expansion\u201d and \u201cimprovement of single &#8211; store efficiency\u201d, its high growth (CAGR of 157% from 2022 to 2024) may not be sustainable.<\/p>\n<p><strong>Suggestions for Entrepreneurs: Key Insights from Laopu Gold&#8217;s \u201cBreakthrough\u201d and \u201cDilemma\u201d<\/strong><\/p>\n<p>Laopu Gold&#8217;s case provides valuable experience for entrepreneurs: breaking the involution in traditional industries through \u201cmodel innovation + cultural empowerment\u201d, while also warning of potential risks such as \u201cinsufficient brand depth\u201d and \u201cweak anti &#8211; cyclical ability\u201d. Based on its experience and problems, entrepreneurs can focus on the following aspects:<\/p>\n<h3>I. Model Innovation Should Address Industry Pain Points, Rather Than Being Simply \u201cInnovative for the Sake of Innovation\u201d<\/h3>\n<p>The core of Laopu&#8217;s success lies in solving the pain points of \u201clow profit margin and homogenization\u201d in the traditional gold jewelry industry: increasing the premium through the \u201cfixed &#8211; price\u201d model and controlling high &#8211; end channels through the direct &#8211; operation model. When designing a business model, entrepreneurs need to conduct in &#8211; depth analysis of the underlying contradictions in the industry (such as cost structure, competitive landscape, and consumer demand) to find the key points of \u201cmismatch between supply and demand\u201d, rather than innovating blindly. For example, if entering the catering industry, one can focus on the contradiction between \u201cstandardization and personalization\u201d and balance efficiency and experience through a central kitchen + customized services.<\/p>\n<h3>II. Cultural Empowerment Should Combine \u201cReality and Fantasy\u201d to Avoid Falling into the Trap of \u201cMarketing Outweighing Value\u201d<\/h3>\n<p>Laopu&#8217;s cultural narratives (ancient craftsmanship and Buddhist culture) provide it with a differentiated barrier, but it is necessary to be vigilant against the excessive amplification of the \u201cfantasy\u201d part (such as superstitious elements). When exploring cultural value, entrepreneurs should focus on the \u201cperceptible reality\u201d. For example, Laopu can enhance consumer trust through process transparency (such as showing the ancient production process) and cultural traceability (such as launching co &#8211; branded products with museums). If engaging in a Chinese &#8211; style fashion brand, one can combine specific handicrafts of intangible cultural heritage (such as Su embroidery stitches and Jingdezhen porcelain &#8211; making) rather than simply using the \u201cChinese style\u201d label.<\/p>\n<h3>III. Brand Building Requires \u201cLong &#8211; termism\u201d, Transforming from \u201cFunctional Recognition\u201d to \u201cMental Belief\u201d<\/h3>\n<p>Currently, Laopu&#8217;s brand is still at the stage of \u201cfunctional recognition based on craftsmanship + culture\u201d and has not yet formed the mental belief of \u201cstatus symbol\u201d. Entrepreneurs need to realize that the ultimate source of brand premium is the emotional recognition that \u201cconsumers are willing to pay an extra fee for the brand\u201d. For example, one can establish long &#8211; term memory points through \u201ccreating classic single products\u201d (such as Apple&#8217;s iPhone and Tesla&#8217;s Model S) and strengthen the sense of participation through \u201cuser co &#8211; creation\u201d (such as NIO&#8217;s community operation), gradually upgrading from a \u201cproduct brand\u201d to a \u201cspiritual symbol\u201d.<\/p>\n<h3>IV. The Channel Strategy Should Match the Brand Positioning, Balancing \u201cControl\u201d and \u201cExpansion\u201d<\/h3>\n<p>Laopu&#8217;s direct &#8211; operation model is suitable for high &#8211; end positioning but also limits the scale. Entrepreneurs need to choose the channel strategy according to the brand positioning. If targeting the high &#8211; end and scarce market (such as luxury goods), direct &#8211; operation control is a necessary choice. If aiming for the mass market (such as fast fashion), the franchise or asset &#8211; light model can accelerate expansion. The key is to find a balance between \u201ccontrol ability\u201d (ensuring brand consistency) and \u201cexpansion efficiency\u201d (seizing market share). For example, a hybrid model of \u201cdirect &#8211; operation in core cities + franchising in lower &#8211; tier markets\u201d can be adopted.<\/p>\n<h3>V. Risk Management Should Focus on \u201cUnderlying Variables\u201d to Avoid Relying on a Single Cyclical Dividend<\/h3>\n<p>Part of Laopu&#8217;s high growth benefits from the gold price increase cycle (from 2022 to 2024), and the problem of its high inventory ratio may expose risks when the gold price falls. Entrepreneurs need to identify the \u201cunderlying variables\u201d of the business (such as raw material prices, policy orientation, and technological trends) and establish a hedging mechanism. For example, if relying on commodities (such as coffee and gold), one can lock in costs through futures tools. If relying on policy dividends (such as new &#8211; energy subsidies), one needs to build technological barriers in advance to reduce dependence on subsidies.<\/p>\n<p>In conclusion, Laopu Gold&#8217;s \u201cjourney to success\u201d is not only a model for innovation in traditional industries but also provides double insights for entrepreneurs on \u201chow to break through involution\u201d and \u201chow to avoid false prosperity\u201d. In the complex environment where consumption upgrade and downgrade coexist, true success requires not only the courage of \u201cmodel innovation\u201d but also the patience of \u201cbrand deep &#8211; cultivation\u201d.<\/p>","protected":false},"excerpt":{"rendered":"<p>Laopu Gold&#8217;s \u201cjourney to success\u201d is not only a model for innovation in traditional industries but also provides double insights for entrepreneurs on \u201chow to break through involution\u201d and \u201chow to avoid false prosperity\u201d. In the complex environment where consumption upgrade and downgrade coexist, true success requires not only the courage of \u201cmodel innovation\u201d but also the patience of \u201cbrand deep &#8211; cultivation\u201d.<\/p>\n","protected":false},"author":2,"featured_media":112,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[3],"class_list":["post-110","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-zhixing","tag-startupcommentary"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Startup Commentary&quot;Tenfold Returns in a Year: Is Laopu the &quot;Herm\u00e8s&quot; in the Gold Industry?&quot; - AIWiseLnk<\/title>\n<meta name=\"description\" content=\"Discover AI-driven resources, tools, and insights tailored for global entrepreneurs navigating China&#039;s business landscape. 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