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Diamonds are forever? Not these ones, De Beers declares

by Greg Klein | May 29, 2018

A new line of lab-grown stones to suit smaller budgets—that might seem a backward step for De Beers. This is of course the company that for so long propped up diamond prices by manipulating mine supply. It’s also the company that created modern consumer demand through legendary marketing strategies. But maybe De Beers has set out to do the opposite for synthetics, thereby sabotaging a threat to the established industry.

Diamonds are forever? Not these ones, De Beers declares

De Beers’ Lightbox subsidiary will offer “high-quality, pink,
white and blue laboratory-grown diamonds at transparent
and accessible prices.”

Such machinations might even be implied in the statement from CEO Bruce Cleaver, who twisted the company’s famous slogan to describe the company’s new brand as “affordable fashion jewelry that may not be forever, but is perfect for right now.”

So much for the immortality of “a diamond is forever.” And the condescension continues. Extensive research shows consumers regard synthetics “as a fun, pretty product that shouldn’t cost that much,” Cleaver added.

“After decades of R&D investment, we’re able to offer consumers a better price today. While it will be a small business compared with our core diamond business, we think the Lightbox brand will resonate with consumers and provide a new, complementary commercial opportunity for De Beers Group.”

So other purveyors of artificiality now face not only a new and formidable competitor, but one that peddles its product deprecatingly.

The company’s new Lightbox Jewelry subsidiary will source its surrogates from De Beers’ Element Six subsidiary, previously a manufacturer solely of industrial-grade synthetics. Hitting the market in September, the Lightbox stuff will sell for prices ranging from US$200 for a quarter-carat stone to US$800 for a one-carat rock, plus the cost of fitting them into fun, fashionable and affordable jewelry.

“We will introduce more designs and colours as the range evolves, and the technological efficiency of our proprietary production process means we will always offer Lightbox at accessible prices,” promised Lightbox GM Steve Coe.

Indeed, diamond analyst Paul Zimnisky recently pointed out that improved technology has driven down prices for synthetics compared to naturals. Selling a year ago for between 11% and 20% less than naturals, synthetics now cost 28% to 40% less than their mantle-made superiors, he reported.

With lab production increasing, Zimnisky added, “it seems inevitable that the price spread between lab-created and natural diamonds across all sizes and qualities will continue to widen, especially in the case of generic lab diamonds, those that are not supported by a manufacturer or retailer’s brand.”

Even so, he estimates current production of gem-quality synthetics at less than five million carats annually, compared with mine output of about 60 million carats.

The industry remains vigilant, however, for synthetics fraudulently presented as natural. Last year the Gemological Institute of America told Rapaport News of an unusually large number of fakes mixed into a parcel of naturals sent to the GIA’s Mumbai lab for analysis.

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