Four Trends Currently Shaping the Diamond Industry
Four Trends Currently Shaping the Diamond Industry
The diamond industry like any other industry adapts to its surroundings, such as social, market, political, and environmental changes. There are four key trends that consistently impact this particular industry – rapid growth of online sales channels, increased marketing spending to support the natural diamond industry, developments in lab-grown diamonds, and an increased focus on the environment and sustainability.
Rapid Growth of Online Sales Channels
Major diamond jewelry retails in the US and China have increased their online sales to 13% and 11%, despite the fact that there has been lagging of sales for online diamond jewelry. More efficient supply chain operations and online sales have caused a decrease in on-hand inventory. This causes jewelers and retailers to rethink the business model for midstream players. Because of greater transparency and the optimization of retail stock, the e-commerce would affect demand and pricing significantly regarding high-quality diamonds.
Increased Marketing Spending to Support the Natural Diamond Industry
Marketing is essential to every industry as it helps companies sell their products and services. Diamonds are the most coveted of all previous gems, as is witnessed by the extremely high demand for them. The diamond industry uses marketing to handle challenges that are considered to be complex, such as addressing consumer needs and competition from the Experiences and Electronics categories. Just from 2019, more than $200 million was invested in the diamond industry marketing. Approximately $70 million to $80 million is included in this budget of generic marketing channeled through the Diamond Producers Association.
Developments in Lab-Grown Diamonds
The lab-grown diamond market grew 15% to 20% gain in 2019. Variety of companies use different technological advances to expand their developments in this field. For instance, Chinese companies use high-pressure, high-temperature technologies to produce rough diamonds. While companies in the US are transitioning to a vertically integrated business through selling premium branded jewelry. India, along with China, sparked this increase by widening price differential of lab-grown diamonds versus natural ones. The acceptance of select jewelry designers and retailers has increased lab-grown jewelry sales.
Increased Focus on the Environment and Sustainability
The focus on sustainability and social welfare is heightened. Consumers and investors are consistently demanding for more transparent and environmentally responsibly practices. Pipeline transparency and tractability have become primary initiatives in multiple industries. This would allow an increase in confidence for both the leaders and consumers. As a result, operations would follow to become more transparent and managed efficiently. Blockchain solutions are used to track diamond origin, and recently developed programs emerge to minimize negative environmental impacts. By focusing on the environment and sustainability, it has also been assisting people in remote locations with employment opportunities.
As the world keeps developing, trends continue to develop with it. However, these trends are always impacting the diamond industry for the better or for the worse. It is always important to be informed of the trends and how these trends impact the diamond industry. Make sure to always keep track of what’s occurring!
Stay tuned for the next blogpost about lab grown diamonds and how sustainability practices are implemented in the diamond industry.
