In 2009, the leading diamond producers convened in St. Petersburg, Russia, at the behest of the then-president of Alrosa, to discuss a joint promotional effort called the International Diamond Board. The talks got as far as looking for a CEO.
But soon the head of Alrosa left; his replacement quickly put the brakes on the project, saying he wanted to know more before making a commitment. The next summer, representatives of the Russian diamond producer all but declared the idea dead.
With new leadership at Alrosa, it appears the company has had a change of heart. Last month an assortment of diamond producers—both large and small—met to discuss a possible new group.
But this new diamond producers association—if it does come to be—does not seem to have the same mandate as the old one. The first explicitly discussed taking up De Beers’ old mantle of “creat[ing] and sustain[ing] strong consumer demand for diamonds worldwide through effective category marketing.”
The International Diamond Board “was looking to be a replacement for De Beers’ advertising,” says one source. “Most producers believe that time has moved on since then.” (It’s also striking that the miners all mentioned legal compliance in their public statements.)
Now, subjects on the table include collaborating on and sharing market research, consumer confidence issues, “diamonds for good,” as well as synthetics. It appears the group may end up being about issues and communications as much as straightforward marketing, though that may also be part of the mix. (Bloomberg, which broke the story, also mentioned “best practices for health and safety, environmental management and supply-chain integrity,” and producing an annual report a la De Beers’ Diamond Insight report.)
Which makes sense: Marketing is expensive. Bloomberg pegs the group’s budget as $6 million, which won’t finance a serious effort. The model seems to be other commodities groups, like the World Gold Council and Platinum Guild Intl., which do limited but generally useful promotion. In any case, a group that might examine the thorny issues in our industry, and possibly respond to false perceptions, is very much needed. It’s been for years.
It also looks like the prospective organization could be limited to producers. (An all-inclusive industry group with a wider mandate than conflict diamonds is very much needed as well.) The miners all share a common concern: Protecting the image of natural gems. Most of the rest of the industry shares that interest, too. But at least two industry leaders deal in synthetics, and other parts of the industry might start to as well if the category takes off. As one knowledgeable observer suggested to me, the group may need to broadcast its message on the virtue of naturals to the trade as well as the public.
Participants caution that this new group is hardly a done deal, and will take a while to get off the ground. But most left the most recent meeting encouraged.
Given that lab-grown diamonds have been arguably making more noise than naturals lately, talk of this group is well-timed. (If it was launched six years ago, the timing would have been even better.) Many members of the trade still want a group that can promote diamonds like De Beers did. Even so, I think many would certainly settle for this.