We just concluded the 40th World Diamond Congress in Israel. The previous Congress was held virtually, by Zoom, at the height of the Corona virus pandemic in September 2020. This Congress marked the first opportunity to bring so many of our friends together. The theme was “Change and Innovation in the New Diamond Reality.”
I would like to present to you here the essence of my opening address. It is about change, and how this impacts our industry. The diamond Industry has a grand past and diamantaires are proud that they do business in the same way for hundreds of years, with a handshake and a mazal.
Today changes are taking place. Conditions are changing, the business climate is changing, the consumer is changing, and the competition is changing. We must be aware of the changes and we must take steps to adapt. If we as leaders of the world diamond industry won’t adapt, the industry will remain behind.
The new consumers, the Y and Z generations, are becoming important parts of our potential client base. The new consumers live in the virtual world of social media, but they are also down to earth. They care about society and the environment, and they demand social responsibility from products they support. They want to be sure that the diamonds they buy do no harm to society and to the earth; they demand transparency and traceability. Trends that begin with the younger consumer quickly spread to more and more segments of the market.
My friends, our industry, which has always been closed and secretive, must open itself more and more. We must work with young thinkers to adapt ourselves to the demands of the new consumer.
Another important change is the creation of branding. More and more we are seeing how branding and advertising is key to success. Large brands that invest huge budgets in marketing are growing in a massive way. Our industry is being taken over by the large chains. Those with strong brands will grow and the smaller stores will find themselves out of business.
In recent years LGDs have grown massively in the US market, although their price is going down every week. Is this good for the natural diamond industry or not? There’s no doubt that they bring new consumers to the market. On the other hand, they are eating into the sales of natural diamonds. If the price of synthetic diamonds continues to decline, natural and LGDs will likely become two separate categories, that can exist side by side.
Last February the war broke out between Russia and Ukraine. We are now more than a year into this war, there’s no end in sight and it may take years. This war has had a major impact on the economy worldwide, causing inflation, rising interest rates, falling stock markets, and reduced real estate prices in the US. It has also had a major impact on our industry, causing US consumers to postpone spending until more certain times.
There’s no doubt that we have had a year with many changes and challenges. To succeed and not only to survive we must be quick to recognize new trends. We must encourage new technologies, implement them, and promote them. That is what is necessary now in the diamond industry: transparency, traceability, and technology. My friends, we need to open our eyes and look to the future. We must accept that our industry is going to be different than it has been for generations. This is good, and it is what the diamond industry needs.