22 Aug 2019
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By: Diamond World News Service
Jul 2 2018 11:02AM
Reference: 16464  

De Beers’ announcement of Lightbox, its lab-grown diamond jewellery brand, sent the entire diamond industry into a tizzy. The next few days followed by the announcement were of surprise and confusion, as everyone in the industry were busy analysing the possible effects of this shocking move. Shocking because no one saw it coming! Some called it ‘self-cannibalisation,’ while some called it ‘disruptive innovation’, and a section of the industry are concerned if the move will affect the admiration people have towards natural diamonds. However, De Beers maintains that the move is a part of a well-thought and well-researched plan and the company sees an opportunity in labgrown diamond jewellery category. One fact that remains constant in all this is – nothing is forever, change is the only constant. By Kavita Parab

In order to sustain and develop, one needs to reinvent. One of the latest business strategies of development is ‘disruptive innovation’, which De Beers is doing with its lab-grown diamond (LGDs) jewellery brand Lightbox. Though De Beers’ announcement to launch lab-grown diamond jewellery brand is referred as logical, industry players are a little wary of the decision.

What caused the Stir?
For more than 100 years, De Beers has championed the natural diamonds business. How can one forget the advertising tagline ‘Diamonds are Forever’? We have been hammered with the well-oiled marketing and advertising strategy that natural diamonds are the only ‘diamonds’ and are ‘unique’, ‘rare’ and they are meant for special, long-lasting relationships. That is how De Beers became synonymous with natural diamonds and therefore, their announcement to launch lab-grown diamonds jewellery caused quite a stir. Over the years, they had been successful in creating value around diamonds by intelligent storytelling.

Therefore, the announcement was certainly a complete shocker for the entire gems and jewellery industry especially for the natural diamond industry. And this is because in the last few years, the natural diamonds industry has been fighting hard against the rising tide of LGDs as there have been a number of instances of illicit mixing which has put the hard-earned reputation of the natural diamonds industry at stake.

The natural diamond traders feel that the consumer perception of natural diamonds might change with De Beers’ move. The consumer might get attracted to the affordable price-point and opt for LGDs and thus affect the demand for natural diamonds.

However, the LGD industry has welcomed the De Beers move. “It has opened the flood gates of interest in lab grown and sustainable diamonds. We were overwhelmed by the interest we received at both Couture and JCK shows recently and the majority of our inventory is now reserved for the remainder of the year. For the professionals in the industry, a diamond is a diamond. They know the difference between a synthetic gemstone and a LGD that is atomically identical to a mined one. It’s the retailers who stuck to the propaganda that are having a difficult time accepting this now,” said Martin Roscheisen, CEO, Diamond Foundry.

What is De Beers’ Objective?
De Beers has made it clear that LGDs and Natural Diamonds are two different products at two different price points. Through Lightbox, De Beers is trying to change the positioning of these two products. “De Beers carries out a lot of research on issues that are relevant to the diamond sector, and recently carried out research on consumer attitudes regarding synthetic diamond jewellery. This research highlighted that there is widespread confusion about laboratory-grown diamonds – what they are, what they are not, how they are formed, and how they are valued. Lightbox Jewelry will be marketed distinctly as man-made, and it will be priced and positioned in a way that’s different from natural diamonds (because as products of technology that aren’t unique or finite, synthetic diamonds don’t have the inherent preciousness or enduring value of natural diamonds, and it isn’t helpful for anyone if consumers are led into believing otherwise),” the company statement mentioned.

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