WITH THE RISE of synthetic diamonds and the dip in natural diamond prices, coupled with global unrest, 2023 is a year that will linger in our memories. It’s a year that defined our industry.
But as we step into 2024, a season of change feels near. We’re in a period of diamond transition, with retailers witnessing the gradual integration of synthetics into their stores and their now-declining market prices.
Consumer alerts about lab-grown diamond value are everywhere, including one published by Rapaport in late November. And many natural diamond wholesalers are still recovering from the past few years, when retailers embraced labs and neglected investing in their natural diamond inventory.
It’s true: Post-COVID diamond pricing, like many business sectors, was at a peak. This led to millions in natural diamond devaluation due to inflated prices and the significant impact of lab-grown diamonds. While synthetics’ impact won’t reach the heights of recent years, the natural diamond sector is undeniably in recovery. Natural diamonds remain the unwavering pillar of the jewelry industry.
As we move forward, 2024 will see a strong return to naturals, with the temporary luster of lab-grown diamonds fading. To rekindle the desire and demand for natural diamonds, retailers need to focus on three key areas:
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1. Training
The lab-focused past few years necessitate a refresher course for many sales teams on the nuances of the 4 Cs, particularly with natural diamonds.
Many labs were purchased based on spec sheets, leading to a blanket approach to quality characteristics.
However, the controlled environment of synthetic production differs vastly from the billions of years Mother Nature takes to craft a natural diamond. Each natural diamond is unique, with its own set of identifying characteristics. Beauty and value are directly correlated, and the 4 Cs are far more complex with naturals than labs. Understanding why two 2-carat natural diamonds with identical characteristics can have different prices, along with other unique quality factors, will be crucial training areas for many stores.
2. Salesmanship
Part of the impact of synthetics on naturals stemmed from a lack of salesmanship. Countless opportunities for higher average tickets, where a natural diamond could have been sold, were lost to the ease of pushing a synthetic “value sale.”
Many consumers now are educated on the transparency of the market. Retail teams who only showcase labs as lead options are missing out. Romance salesmanship requires belief in what you offer. The intrinsic value of a natural diamond over history makes it one of the most coveted items in the world. It’s a passion asset, the most concentrated form of transferable wealth. Its allure, value, and centuries-old desirability are what make it special now and forever. Salesmanship requires a deep understanding of how to communicate beauty, romance, rarity, and value.
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3. Events
The most successful stores know how to build community with their customers. People buy people, and fostering customer loyalty requires ongoing effort. As we plan store calendars for 2024, harnessing the power of events is key. From spring bridal to holiday private parties and VIP presentations, events – presented with creativity and a focus on community – can be powerful tools to grow your natural diamond business.
De Beers’ recent $20 million natural diamond campaign has already sparked a resurgence in reminding consumers what makes diamonds special. As 2024 progresses, there will be big shifts in the perceived value of lab-grown diamonds. Retailers need to create opportunities to reignite attention and excitement around natural diamonds once again.
Natural diamonds are the pillar of the jewelry industry, their history intrinsically woven through centuries. While the impact of synthetics is a chapter we’ll never forget, natural diamonds will always reign supreme. As retail stores look forward to 2024, investing in, growing, and rekindling consumer excitement around natural diamonds will be essential for continued success. The future for natural diamonds is guaranteed to shine brightly. Let’s bring back the brilliance, desire, allure, and attention a natural diamond rightfully deserves.