Perfection — a rare occurrence. Finding it twice — marketing magic.
That’s the mind-set of Suzanne Miglucci, president and chief executive officer of Charles & Colvard, in the lead-up to JCK Las Vegas, the jewelry industry’s mega trade show set to run from May 31 through June 3.
The Charles & Colvard business is built around the lab-made gemstone moissanite, which bears striking naked-eye similarity to diamond. Miglucci assumed the ceo position in late 2015 and in 2017 began a re-branding strategy, redirecting the firm from primarily a supplier of loose gemstones to an e-commerce-based jewelry company. Under her watch, the small public company — with a $42.1 million market cap — that had for years struggled to find its footing is on an upward trajectory. Last Friday, it posted its third consecutive quarter of profitability, and over the past week the stock has climbed dramatically, albeit from a low starting point, up 67 percent, to close at $1.94 on Thursday.
A key focus: marketing moissanite as an enticing, sustainable option for engagement rings. As Miglucci sees it, the time is now for that option to explode. “We just happen to have a perfect storm,” she said during a recent trip to New York from the brand’s base in Morrisville, N.C. “We now have a perfect gemstone. We have engineered it for years and years, and we now have a stone that has no imperfections.” The brand’s high-end range is marketed under the moniker of “Forever One.” As for part two of the equation: “We have the perfect customer in the Millennial.”
Miglucci said that for years, Charles & Colvard produced a sustainable product “and nobody cared.” Now, however, Millennial and emerging Gen Z consumers are shopping more consciously than their older counterparts, researching what they’re buying not only for its bottom-line value but for its impact on the environment, including when it comes to a major purchase such as an engagement ring. “This consumer is asking for something sustainable that she can put on her hand,” Miglucci said. That customer cares about the environment and is naturally drawn to a product that doesn’t “strip the earth.”
She thus makes the perfect target customer for the core product of the company that has been in business since 1995, developing and refining its lab-made product. Charles & Colvard was formed as a spin-off of Cree, a major supplier of silicon carbide, which has numerous industrial uses including as semiconductors and abrasives. It is also the compound from which moissanite is made. Silicon carbide exists naturally but is extremely rare. It was discovered in 1893 in a meteorite crater by the chemist Henri Moissan, who thought he’d found diamond. According to Miglucci, its hardness is second only to diamond and its brilliance exceeds that of diamond, making it perfectly suited for jewelry gemstones, particularly engagement rings, which comprise 50 percent of the firm’s business. Not surprisingly, earrings are the second-biggest seller.
Once the world’s sole maker of moissanite, previous company executives “squandered” a patent the firm had held for 20 years, which expired two years ago, Miglucci said, and now, competitors have entered the moissanite stakes. “But I really don’t mind,” she mused, “because now I’m getting a little bit of a buzz from some of these other organizations coming to market.”
Also growing in profile: lab-created diamonds, which are moissanite’s most direct competition in the engagement ring market. Just as Miglucci sees a bright side to competition from new moissanite players, she also noted the peripheral benefit to escalating interest in lab-made diamonds. “We’re all on the journey together,” she said. “I love the fact that the diamond industry has come so far since the De Beers announcement about embracing lab-created [diamonds]. It’s a rising tide that lifts all boats. That’s helping this brand as well.”
That tide is counting heavily on the appeal sustainable products hold for a young, informed clientele. Miglucci insisted that within that demographic, the significant price differential between moissanite and mined diamonds is not the primary draw. While a Baby Boomer might buy a moissanite piece and pass it off as a far pricier diamond, a Millennial is likely to flaunt moissanite for what it is. “She is looking for something she knows is ethically sourced,” Miglucci said.
The messaging around ethical sourcing and overall sustainability centers on moissanite’s point of origin. “It’s created in a laboratory, and it will last forever,” Miglucci noted. Yet there’s more to the story. For its finished jewelry pieces (the firm continues to sell loose stones to other jewelry makers), the brand uses only conflict-free metals, preferring recycled materials whenever possible. “We think there’s enough metal that’s come out of the ground,” Miglucci said. “We’re not big fans of mining; we don’t like what happens to the environment with it. We are fans of recycling goods that are already out there.”
That said, asked to quantify the environmental advantages of moissanite over mined diamonds through the entire manufacturing process, from Cree’s creation of hockey-puck-like silicon carbide discs through to the faceted, finished jewelry pieces, Miglucci acknowledged some gray areas. “It depends on how you want to slice and dice it,” she said. “Is mining a challenge to the environment? It absolutely is. How many tons of earth do we move and how much water is infected by the process? We believe that’s a very important and meaningful thing that we know we can avoid with our stuff…It’s the mining piece that’s different. I don’t know that [full] carbon impact…I just know that it doesn’t strip the earth. That’s the difference.”
At the same time, the firm is dedicated to defining and controlling its overall carbon footprint. While noting that Cree is very transparent in its work, once the silicon carbide is obtained, Charles & Colvard’s has “a complicated supply chain…It is a challenge for us to delve into all of that and [determine] what’s the carbon footprint of all the third parties that we’re working with, but it’s important to us because we believe bringing sustainable product forward is the right thing to do.”
Yet sustainability isn’t moissanite’s only appeal. Miglucci noted silicon carbide’s double-refractive property. “Basically, when a beam of light goes into the stone it has the ability to split the light into two pieces. So it emits more light than is in the room,” she explained. In layman’s terms, it’s “just crazy sparkly,” with “more brilliance and more fire than diamond. So we will always be the most sparkly thing in your jewelry box.”
The sparkle impact is derived from the stone’s inherent qualities and also the faceting, a process which is highly nuanced and different than for that of diamond. Here, Miglucci maintained that her brand has a clear-cut advantage over newcomers to moissanite, as the firm has developed techniques through years of collaboration with highly skilled artisans, mostly in the Asia Pacific region, who work exclusively on moissanite for Charles & Colvard.
Refining the faceting process and developing new cuts takes time and painstaking work. The latest accomplishment: an inventive iteration of the rose cut, double-sided with a total of 48 facets, so that it looks the same from both sides. Called Duet Rose, it will be unveiled at JCK. “It’s going to be absolutely ridiculous. Wait till you see it!” Miglucci exclaimed. “Imagine earrings where it doesn’t matter what side you’re looking at. I’m so excited about it.”
So how to get the word out? Miglucci’s background is in e-commerce and marketing. She said that before she accepted the ceo position, she questioned the board about whether they were sure they wanted someone with no jewelry or manufacturing experience. During the course of the discussion, “there was a moment when I realized I could help move the needle for this company because of my branding expertise, certainly the e-commerce and digital marketing side of it,” she recalled.
That needle shift centered on identifying and connecting with the right customer — the Millennial. The strategy for capturing her focuses on consumer-generated social media content and influencer marketing. Of the former, Miglucci said, “she’s sharing her story on her Facebook page, and we in turn proliferate those stories and help others hear our customer story. We don’t think it’s about us beating our chest and telling who we are. I’d rather the consumer say, ‘here’s why I chose moissanite and why it’s my sustainable product.’”
As for influencers, the focus is on the nano- or micro-influencer, with 20,000 to 100,000 followers. At they scale, they often telegraph authenticity and have serious engagement with their followers. And they don’t cost a fortune.
Though an engagement ring is typically purchased by the fiancé, and the fiancé is typically a guy, it’s the woman who’s driving the transaction. That’s intentional at Charles & Colvard, which markets to a specific persona, a “girl boss” who is informed, decisive and secure in her choices. “She is telling him, ‘I’m making this choice. I want a sustainable stone. I’m good with moissanite. I’d like this one,’” Miglucci said. She added that the woman might pass along the URL of the product page or spell out stone and setting preferences. However she does it, “she is ultimately choosing.”
While that young woman may be an in-control, modernist thinker, more often than not, when it comes to her engagement ring, her choice swings toward a time-honored aesthetic. Seventy percent of Charles & Colvard’s designs are classic, because that’s what sells. “I’m going to bring you in with the cool factor, I’m going to give you the stackers because that’s cool today,” Miglucci says, referring to her brand’s trendier pieces. “But I’m not going to adjust and curate my entire line around what is cool.”
The retail focus is on direct-to-consumer e-commerce via the company’s web site, but the “Forever One” range is also available at physical retail, including in about 200 Helzberg Diamonds doors and upwards of 4,000 independent jewelers across the country. “So it’s meaningful,” Miglucci said.
While the challenges are considerable, the ceo is bullish on the future for Charles & Colvard, which she refers to as a “23-year start-up.”
“We love it that the validation is out there. We have the perfect stone, we have the perfect consumer in the Millennial, and we have the perfect channel in online,” Miglucci said. “We’ve been waiting for this moment. We’re ready to take it by storm.”