Diamonds continue to be a girl’s best friend, claims De Beers in its new industry study. The 2019 edition of the firm’s Diamond Insight Report examines the ways in which diamonds continue to “rule the roost” for women marking pivotal life-cycle events.
The company took its latest report as an opportunity to examine how young couples buy diamond jewelry for each other, coining the term “love-gifting” to describe jewelry consumption in the post-#MeToo movement era.
But even more changes are afoot. Last year, De Beers took its annual report as an opportunity to parse the differences between mined diamonds and those that are grown in a lab — touting its own lab-grown diamond start-up, Lightbox, as a big opportunity. This year’s report does not so much as mention lab-grown diamonds and instead examines the ways in which “natural” diamonds are the stone of choice for young couples expressing love through jewelry.
Speaking to WWD about the report, Stephen Lussier, De Beers Group executive vice president for consumer and brands, downplayed the excitement around lab-grown diamonds. “Around this time last year there was a lot more noise than there was business [for lab-grown stones],” he said. “They represent less than 1 percent of the world market and have dropped dramatically in price, a 65 percent decline in the wholesale price this year alone, which is likely to continue.”
Lightbox was introduced in September 2018 as a vertical subsidiary that gave De Beers some authority and control over lab grown diamond’s pricing structure and public perception. Now, Lussier said that Lightbox represents “a new focus for De Beers on fashion accessories — the very big market under $1,000 with jewelry that has semiprecious stones or stones with a lot of color.”
Lussier further emphasized, “This report really focuses on the concept of what diamonds represent in the world of relationships and the changing nature of relationships. [Lab-grown] stones are inexpensive and not inherently precious or enduring in terms of value. When consumers are marking important events with a diamond, they want the real thing.”
De Beers’ latest report specifically examines how diamonds are consumed by couples in China, Japan and the U.S. — countries that Lussier said represent more than 70 percent of the global market. Previous reports have also included India and the Middle East in their scope.
“China remains the market with the most opportunity for the future,” Lussier said. “If you look what we have achieved with the engagement tradition in 20 years, going from nothing to half of all brides in China getting a diamond, there is a lot of opportunity to increase that to the American ration of three-quarters of all brides buying a diamond.”
While diamonds are not traditional in Chinese culture, Lussier said they have not been a hard sell in the country because, “diamonds tap into the human desire to own something precious and beautiful.”
In examining how Millennial couples consume jewelry, De Beers constructed a new blueprint that outlines important life-cycle events. The company realized that most couples now co-habitate before becoming engaged, which has altered the ways in which they consume love and engagement jewelry.
The firm said 14 percent of engagement rings are now entirely paid for by women, who spend about 25 percent more on ceremonial jewelry than if a man were to buy it for them.
“The nature of what that diamond design looks like is changing, we are seeing more design-oriented pieces that offer a more unique and personal feeling for the woman who wears it,” Lussier said.
The average American spent about $3,400 on an engagement ring in 2017, according to De Beers’ research, with the typical ring holding about 1.70 carats of diamonds (a considerable leap from one carat in 2013).
While the Japanese consumer spent about the same ($3,500) per ring, a Chinese consumer shelled out considerably less, spending around $900 for a ring with an average 0.19 diamond carat weight.
Couples rings are a tradition emerging in China, in which a set of two matching rings is sold together. About 83 percent of these rings include diamonds, most of which are set in platinum.
Platinum is also the most popular metal for Japanese love and engagement jewelry, while white gold is the most significant metal for U.S. consumers.