Dancin' with the Stars- Al and Gina try some spin to stop the inevitability of change.
In the past 5 years younger consumers have come into jewelry stores all over the world asking to see lab-grown diamonds and learn about this new product category. These consumers are customers for diamonds (both mined and lab-grown) and everything else a retailer jeweler can show them. The lab-grown community wants to accentuate the choice now available to consumers and get more next gen consumers into jewelry stores- the same consumer that the traditional jewelry industry struggles to attract. The mined diamond industry, led by DeBeers, just wants to kill the lab-grown diamond category. Why? To support their own valuation in a potential sale of the company. Spoiler Alert: you can’t put the lab-grown diamond genie back in the bottle; you can’t go backwards in time; you can’t stop change. Tradition is only the illusion of permanence.
In a world where the jewelry industry is experiencing rapid evolution, DeBeers has positioned itself for sale, sparking significant industry interest. In an attempt to bolster their allure and justify their valuation, DeBeers has teamed up with Signet, the largest jewelry retailer in the USA, to launch a marketing campaign aimed at promoting the perceived value retention of mined diamonds over lab-grown diamonds. This narrative, however, is built on a shaky foundation—a myth perpetuated since 1938 when DeBeers launched its first diamond marketing campaign. Today, consumers have choices, and they are increasingly gravitating towards lab-grown diamonds, driven by a blend of ethical, environmental, and economic considerations.
The story of diamonds as a store of value is a well-crafted myth that dates back to the late 1930s. Faced with declining sales and an oversupply of diamonds, DeBeers embarked on a groundbreaking marketing campaign. The slogan “A Diamond is Forever” was introduced, embedding the idea that diamonds are not just a purchase but an investment, a symbol of eternal love and, crucially, a store of value. This campaign was so effective that it transformed the public’s perception of diamonds, making them a must-have for engagement rings and other significant life events.
The reality, however, diverges sharply from the myth. The resale value of diamonds, especially those purchased at retail prices, often falls significantly short of their original cost. A report by The Guardian revealed that the resale value of diamonds is generally only 20-40% of the original purchase price. This disparity highlights the fallacy of diamonds as a reliable store of value. The illusion of value retention is further exacerbated by the opaque pricing mechanisms within the diamond industry, which are often controlled by a few major players, including DeBeers.
"The hidebound scrabblers for power, mired in an order of the old, need to understand that diamonds are not forever. You can’t spin a lie in perpetuity. There comes a time when folk wake up and change gears while you “lower your diamond production guidance”. No-one has ever shrunk to grow, particularly when the levers of manipulation have withered."
Despite DeBeers’ and Signet’s efforts to sway public opinion, consumers today are more informed and empowered than ever before. The digital age has ushered in unprecedented access to information, enabling consumers to research and compare products more thoroughly. This transparency has been detrimental to the traditional diamond industry’s narrative.
Moreover, the proliferation of social media and online review platforms means that consumer experiences and opinions are widely shared and easily accessible. Positive testimonials about lab-grown diamonds abound, with many consumers praising their beauty, affordability, and ethical sourcing.
The current campaign by DeBeers and Signet to emphasize the value retention of mined diamonds can be seen as a last-ditch effort to maintain market share in the face of changing consumer preferences. However, such efforts are unlikely to succeed in the long term. The jewelry market, like any other industry, is subject to the forces of innovation and consumer demand. As lab-grown diamonds continue to gain traction, the traditional diamond industry’s hold on the narrative of value retention will weaken.
The “Big Little Lie” that DeBeers and Signet are attempting to perpetuate about the superior value retention of mined diamonds is a relic of a bygone era. Today’s consumers are smarter, more ethical, and more environmentally conscious. They recognize the advantages of lab-grown diamonds and are not easily swayed by outdated marketing myths. As the industry evolves, it is clear that lab-grown diamonds are not just a passing fad but a significant and lasting shift in consumer preference. In this new landscape, transparency, sustainability, and value for money will reign supreme, rendering the old myths of mined diamond value retention increasingly irrelevant.
