Diamond marketing: ‘Diamonds are forever’.
But they weren’t eternal in the first place. Diamonds, as we know today, has constantly been re-imagined by the industry’s relentless and savvy marketing efforts since the early 1900s. The idea of ‘a diamond’s size and authenticity is directly proportional to the love’ is a rather recent one. De Beers, the early monopoly in diamond market, had predominantly focused its foremost efforts in cementing such ideas to help perpetuate the desirability and cultural weight of the stones.
How? De Beers tactfully controlled both supply and demand for diamonds globally, substantially pushing up the prices over time. Through careful execution and smart copywriting came along the concept of engagement rings that pushed both demand sides. Within only three-quarters of a century, diamonds were turned into the ultimate symbol of love, wealth, status and even power.
(Image via Quartz)
Without their persistent multi-channel marketing campaigns, diamonds are said to be worth at least 50% less than the prices we pay at jewellery stores, says HubSpot. According to Quartz, the 2014 annual report by De Beers ‘explicitly defined its greatest asset’. Surprisingly it wasn’t referring to their mined rough diamonds. Instead, De Beers reassured its dedication to ‘relentlessly nurture and protect an idea – ‘’the diamond dream’’. The diamonds will always need to be equated to romance and eternal love. Put in another way: sell the cultural values.
Today’s competitive jewellery market needs more than just aspirational marketing.
But De Beers’ monopoly on the flow of diamonds didn’t last forever. While the aspirational and emotional value of diamonds still persist, today’s diamond market looks a little bit more complex.
As L2’s recent report has revealed, we’ll see many jewellery brands turning to online platforms to capture the growing eCommerce sales for luxury products. While the diamond market is rather fragmented with top 10 brands dominating less than half of offline global sales, the top 10 are controlling 75% of the market online. As luxury eCommerce is estimated to grow exponentially, ‘heritage brands with weak digital investments and hesitancy towards e-commerce’ will inevitably need to ramp up the speed and investment to catch up.
Ethical concerns and the changing consumer behaviour
Besides the competition, can well-entrenched brands like De Beers withstand the slowly changing consumer attitudes and norms? While it has innovatively incubated new values based on the diamond dream, many think that millennials are arguably falling out of love affair with diamonds. Although it remains the staple for engagement rings, it is hard to ignore the fact that more and more millennials prefer to spend on other things like travel and handbags. Many young women don’t see diamonds the way the previous generations did, according to the Daily Beast. Amidst the ‘blood diamond’ scandals years ago, today’s twenty-something generally look out for the ethically-sourced stones.
It is, therefore, less surprising to see the growing number of digital-savvy and boutique-style diamond eCommerce businesses. Some comparatively affordable and many ethically sourced. Startups such as Diamond Foundry has already awed some forward-looking celebrities like Leonardo Dicaprio with lab-grown, quality diamonds with little or no environmental and humanitarian cost by ‘removing the need to mine the raw materials’.
Alright, big names are still enjoying billions of dollars of sales each year. But the rising competition from innovative and ethical-focused startups, as well as the changing consumer taste are very likely to pose some real challenges. Needless to say that they’re already seeing some effects of falling demand from China and Russia in the light of slowing economic growth. Today, we are still hung up on brand names when it comes to diamond shopping. But will the next generation still prioritise a Tiffany ring over lab-grown, ethical diamond?
What do you think?
Appnova is a digital agency specializing in web design, UX, e-commerce, branding, digital marketing and social media.