Famous for being a traditional industry where time-honoured practices remained untouched while the world evolved around us, the diamond sector has changed rapidly since the turn of the millennium.
Such change has been necessary as the landscape in which we operate has shifted faster than ever before. The expectations and priorities of people across the industry – from diamond-producing country governments to end clients – are completely different.
Governments are rightly seeking new ways to drive economic development and diversification through diamonds, and end consumers are more keenly aware of environmental and social issues.
Investors are looking for strong ESG performance, so the three Ps of ‘people, planet and purpose’ are now as prevalent as the four Cs.
This evolution is reflected in the agreement De Beers recently reached with Botswana, whereby the focus is not restricted to supporting Botswana’s economic returns from its diamonds.
Renewed focuses, such as how to support diversification, the improvement of a knowledge economy, and increased international recognition of investment opportunities in Botswana are now a priority.
Virtue becoming value
At the other end of the supply chain, where diamonds once spoke to financial status, end clients are now focused on making sure their purchases reflect their priorities and show them to have a consumer conscience.
In short, value is increasingly connected to values.
The good news is that the natural diamond industry has an amazing story to tell in terms of how these miracles of nature are supporting the lives and livelihoods of millions of people worldwide.
We have made huge strides forward; however regrettably, consumer perception of the industry has potentially moved in the opposite direction.
This can be credited in part to the legacy of highly visible cultural reference points such as the Blood Diamond film, and misrepresentations of the natural diamond industry by some companies seeking to boost demand for lab-created diamonds at the expense of natural diamonds.
This damage to consumer perception comes at the expense of all those who rely on diamonds, from communities in Botswana to jewellers in Brisbane, Sydney, and Melbourne. It has left many people with outdated and negative perceptions of the modern industry.
However, as we continue to see natural diamonds and lab-created diamonds diverge and the two sectors become established as separate categories, there is a great opportunity to engage with end clients positively about both products.
Setting them against each other is a race to the bottom, and we would be much better served by focusing on the positives of what each offers.
Education as a priority
The natural diamond value proposition has stood the test of time for decades, as a rare, unique and timeless symbol of our finest emotions.
Natural diamonds speak to enduring value, and as we educate consumers about their positive influence on the people and places where they come from, they will maintain their position as the ultimate luxury for the modern client.
Meanwhile, lab-created diamonds can secure their long-term position as an exciting and value-accretive part of the jewellery sector by evolving a proposition that will stand the test of time.
This means a focus on innovation, new cuts and colours, and accessible prices to enable lab-created diamonds to establish a compelling narrative that can be sustained as their value evolves, and which will not undermine the long-term value of their natural counterparts.
Jewellery retailers are at the vanguard of consumer education, and jewellers need to consider the importance of their long-term futures in communicating these two positive and complementary propositions.
With lab-created diamond values expected to continue the significant decline that we have already seen as supply continues to increase, supporting the long-term value proposition of natural diamonds while developing a sustainable market position for lab-created will be vital.
At De Beers, we are working to develop the tools and techniques to facilitate this positive long-term outcome for both natural and lab-created diamonds.
It’s a future where the two categories support each other’s success – as well as that of those who sell them – rather than pulling each other down.
Our Lightbox business is focused on establishing an exciting narrative for lab-created diamonds that is distinct from natural diamonds, and which will continue to resonate with consumers even as product values continue to evolve.
Meanwhile, the initiatives we are working on to support retailers in telling the story of the good that natural diamonds do – including Tracr, the IOD Origin suite of services and our Building Forever approach – will transform the ways in which end clients are connected with their diamond, as well as the unique story of its lasting positive impact.
The world of diamonds is changing on an almost daily basis, and it’s up to us to lead that change.
So, let’s all get behind these initiatives that are helping to shape the new diamond world, and use them to make sure end clients understand just how brightly our diamonds are sparkling – not only in jewellery boxes but also for the people and places where they come from.
Name: Feriel Zerouki
Business: The De Beers Group
Position: Senior Vice President
Location: London, UK
Years in the industry: 18
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