Editor’s Note
Pandora’s strategic retreat from China, involving the closure of 100 stores and significant layoffs, signals a dramatic reversal for the once-dominant affordable luxury brand. This move underscores the shifting dynamics and intense competition within the Chinese consumer market.
On August 15, 2025, Danish affordable luxury jewelry brand Pandora A/S announced it would expand its planned store closures in China from 50 to 100, reducing its existing store count by approximately 57%. This decision, accompanied by large-scale layoffs, marks a significant strategic contraction for Pandora in the Chinese market.
As a former giant selling 100 million pieces of jewelry annually and ranking among the top three globally, Pandora’s decline from a “symbol of a girl’s dream” to being collectively abandoned by young people is not just a brand crisis but a microcosm of the profound transformation in China’s consumer ecosystem.
Pandora’s retreat in China stems from the convergence of multiple factors, creating a vicious cycle. These are mainly reflected in four areas: consumer preference shifts, product flaws, market competition, and cost pressures.
First, a structural shift in consumer preferences. In recent years, Chinese consumers’ core purchasing logic has shifted from “emotional drive” to “rational judgment,” emphasizing value retention and practicality. Young consumers are moving from “decorative consumption” to “asset-based consumption,” with gold becoming the preferred choice for both investment and daily wear due to its cultural identity, safe-haven attributes, and value retention.
Second, product design and material issues accelerated the decline. Pandora’s designs lack distinctiveness, often mocked by consumers as “Yiwu trinkets.” More critically, its primary materials—copper-silver alloy, 925 silver, cubic zirconia, and enamel—are prone to oxidation and tarnishing, requiring cumbersome maintenance. In the secondary market, Pandora jewelry is almost unsellable, with pieces originally priced over a thousand yuan now worth only tens of yuan.
Third, a reshaped competitive landscape. Traditional high-end luxury brands like Tiffany and Bulgari have launched youthful series, capturing high-end customers. Local brands like Chow Tai Fook and Chow Sang Sang offer fashionable gold jewelry with value-retention functions. Emerging brands like HEFANG attract young consumers with fast updates, affordable prices, and trendy designs. Pandora’s “affordable luxury customization” positioning became awkward: lacking the brand barrier and collectible value of high-end jewelry, missing the hard currency attribute of gold, and offering insufficient value compared to fast-fashion accessories.
Fourth, rising raw material costs increased pressure. The price of silver, a key raw material for Pandora, climbed to a 15-year high. To hedge costs, Pandora raised prices twice by a total of 9%, directly weakening its value proposition and leading to customer loss.
Despite the continuous contraction in China, Pandora’s global performance remains growing. In Q2 2025, global revenue reached 7.075 billion Danish kroner, a year-on-year increase of 4.5%. The US market contributed 34% of revenue, growing 10%, becoming the group’s main profit source.
Growth is driven by strong demand in the US market, where consumers still pursue personalized decoration. DIY beads have sparked a “makeover trend,” even transformed into headwear and belts, and spread virally on TikTok. The contrast between Chinese consumers’ pursuit of value retention and American consumers’ preference for personal expression reveals a deeper reality: in mature consumer markets like the US and Europe, personal expression remains mainstream culture, while in China, with slowing economic growth and increased wealth anxiety, consumers focus more on value retention, safety, and practicality.
Pandora’s retreat in China stems from the combined effects of shifting consumer preferences, product flaws, intensified competition, and strategic missteps. Its early success benefited from the consumption upgrade dividend. However, as “reverse consumption” becomes a new trend and gold replaces silver as the “value-retention choice,” it signifies that Chinese society is undergoing a profound transformation from “conspicuous consumption” to “survival consumption.”
Pandora’s store closure wave in China is not just a brand’s dilemma but a realistic reflection of the shattered middle-class illusion and the rebalancing of consumption structure. As the real estate bubble bursts, debt remains high, and population ages, the middle-class “affordable luxury dream” is broken. When value retention becomes more important than romance, and when “self-pleasure consumption” gives way to “cautious spending,” an era comes to an end.
