PARIS — Swarovski is launching a new kind of lab-grown diamonds — ones with colors.
“We love to cut, we believe we’re real master cutters, so this category always intrigued us,” said Markus Langes-Swarovski, member of the company’s executive board, speaking of lab-grown diamonds. The company tested lab grown diamonds in 2016, and began offering white lab grown diamonds two years later.
The stones will be presented during Couture Fashion Week in Paris.
“We have tried to be the original purveyor of brilliance in all kinds of materials, not only crystal,” he said, citing zirconia and natural stones as an example.
“To really translate the magic of Swarovski for that category, we really believe that color is, I think, the right approach,” he added.
“If you look into the field of mined diamonds, the colors are very, very rare, so we thought we have to celebrate human ingenuity and create a beautiful palette of 16 colors that are also available in the minefield but very, very seldom and very expensive because of the rarity of these diamond colors,” he added.
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Drawing on its marketing expertise, the company has divided the new colors into four pillars, giving them specific references: fashion art, music and architecture. Each pillar will feature a so-called hero color, which will come in a 2.5-carat cushion cut stone, while the other colors will correspond to 1.25 carat stones, which will be show in Paris. But in general, they will come in 0.25 to 1.5 carats. The company has named the hero colors with names like androgyny flamingo, heavy metal cherry and gothic cognac.
In an industry where other companies can produce the same thing, Swarovski has sought to differentiate itself by producing high products and making its name known.
“This notion of narrative is key for us,” said Langes-Swarovski, noting the 125-year-old company aims to “catalyze the creativity of our clients.”
“We came up with this high-quality, very, very broad assortment of colors and shapes and sizes in order to pursue that basic promise of Swarovski,” he said.
The lab-grown diamond business remains small for the company, but fast growing, he added, pegging growth in the double-digit range.
“It can become a large business for Swarovski,” he predicted, noting the company is already working on new ideas to promote the idea that it can become a “creative category in its own right.”
“Healthy margins would be possible, but we have to achieve it first,” he said, when asked if the category could generate higher yields than other parts of the crystal business. Brands have price premium potential, while the loose stone business is comparable to other categories, he added.
Lab-grown diamonds take around three weeks to produce, with some colors calling for additional steps, like pressure treatment or irradiation treatments to come up with a specific color, in his description.
“It’s a true potential technological disruption for the jewelry business,” he said.
Competitors in the lab-grown business are mainly start-ups, but no established consumer brand has moved into the field, he added, noting Swarovski is open to partnering with other producers, even if the company produces them itself.
Swarovski’s crystal business, which is run by the fifth generation of the family, counts more than 30,000 employees and generated around 2.7 billion euros in revenues in 2018, accounting for the bulk of the group’s sales. The group also includes optical devices company Swarovski Optic and Tyrolit, which sells abrasives like diamond saws. Group sales were 3.5 billion euros in 2018.