DeBeers Advertising-A Knotty Problem for the Diamond Industry

As further evidence of the chaos in the $30 billion plus U.S. diamond market, DeBeers is launching a new advertising campaign emphasizing “feeling good today”, that according to a Robert Bates, a senior editor for JCK. Just what DeBeers’ rationale is remains to be seen.   Clearly, the direction is a substantial departure from the company’s previous campaigns that targeted relationships to build that emotional connection with the consumer.

This campaign also varies in other material ways according to Bates. For instance, it’s about marketing a specific style of jewelry, not building the market for diamonds in general. That automatically limits its appeal. Frankly, female consumers will either love it or hate it, which is a bad place to begin a new campaign. Granted, companies that market brands frequently develop a signature look that consumers can identify with.  Gucci, Cartier, and Movado to name just a few, have successfully market their line of jewelry products for decades, using that methodology. But, Debeers’ new campaign isn’t about a line of products as much as it is about a variation of a single style, called Everlon

Evidently, there isn’t any particular significance of the name Everlon. Despite some reference to subliminal associations with the Foreevermark, DeBeers insists the name is just for this “knot-style” jewelry product, which begs the question, just what’s the company trying to accomplish with this campaign? Many site holders, manufacturers, and retailers are asking the same question too. According to the report only three site holders have signed up for the plan as have about 300 independent retailers. Note that’s 300 hundred out of about 22,000 specialty retail jewelry companies or approximately 1.3%. So if exclusivity is a key driver for this product, DeBeers has accomplished that.

Still, you have to wonder what the company’s expectations are. While the campaign seems to be focused on the independent jeweler, the product is already being sold on J.C. Penney’s website as a drop ship item direct from the supplier. Whether J.C. Penney will discount the product in the fourth quarter is as uncertain as is its inventory investment for the company’s in-store jewelry departments.  In reality, Penney may have it right, especially if display stock is on memo. Something those 300 independent jewelers should consider.

For those that believe any kind of trade advertising is good for the industry, the new DeBeers effort is quite satisfactory. On the other hand, at first glance, it looks like a huge disappointment when compared to the companies past achievements. Of course, this isn’t your father’s DeBeers, but a new company, which hasn’t quite decided what it wants to be when it grows up. That indecision and vagueness is evident in most of its post 2001 operations, including rough diamond marketing and retailing. In all fairness, DeBeers is a more diverse company today. Still, it has much in common with the old DeBeers strategically, which seems to have been misplaced in the process of going private. After all, the concept of a cartel wasn’t an end unto itself, but a means to an end. That idea is what has been lost. I think it was best paraphrased by Edward Jay Epstein in the article “Have You Ever Tried to Sell a Diamond” published in The Atlantic in February 1982. There Epstein says, “The diamond invention is far more than a monopoly for fixing diamond prices; it is a mechanism for converting tiny crystals of carbon into universally recognized tokens of wealth, power, and romance. To achieve this goal, De Beers had to control demand as well as supply. Both women and men had to be made to perceive diamonds not as marketable precious stones but as an inseparable part of courtship and married life. To stabilize the market, De Beers had to endow these stones with a sentiment that would inhibit the public from ever reselling them. The illusion had to be created that diamonds were forever -- "forever" in the sense that they should never be resold.”

It was true then and it is no less true today. 

Unfortunately, in the intervening three decades, a lot has been lost in the translation. Now, forever has been reduced to feeling good today, which brings the diamond down to the level of a new video game, the quick adrenaline fix, or some other transient way to jump start the libido momentarily in the absence of more permanent symbols in our lives. Notwithstanding the recession, symbols still project powerful images about who we are as well as convey complex feelings better than any other form of communications, something the old DeBeers seemed to understand a lot better than its newest progeny.