Some thoughts on De
Beers’ decision to shut down its New York JWT account and focus on
the Forevermark:
– This makes it abundantly clear, if it wasn’t already, that
“generic” promotion of diamonds is dead in the United States. Even though De Beers hasn’t done much
in recent years, this is still a milestone moment, as the company’s ad campaigns
made the American industry what it is. If we ever want the U.S. market to return to something resembling normal, there must be more diamond
promotion.
Perhaps the big gem producers aren’t too worried about U.S.
consumers these days, with all the talk of rising prices due to supply shortages. And yet, if these increased prices are to be sustainable in the long-term, they need to be related to consumer demand. And the U.S. is still the most
important market.
The International Diamond Board, which was meant to increase
“generic” promotion, has been stalled for some time, after Alrosa withdrew its
support. Here’s hoping this new move makes executives there
reconsider.
– The timing is interesting. The conventional wisdom,
among informed observers, was that
De Beers probably wouldn’t make this move until its U.S. legal issues were settled. Well, the lawsuit appeals are still dragging on, and won’t be over with until
at least next summer, but the company is charging ahead regardless.
Forevermark is also associated with former CEO
Gareth Penny, who resigned this year. And while a search is on for his
successor, there are reports
that Anglo-American may be looking to increase its control of the company.
In short, De Beers is in flux. It will be interesting to see what new leadership means for the Forevermark, which is a 10-year-old (and
still, I would argue, unproven) idea at this point.
– Another question: How will the Forevermark be sold in the
U.S.? When it was first conceived, the “mark” was meant to be an assurance that the diamond was natural, ethical, and non-treated. But treatment and lab-grown issues don’t have a lot of traction these days, and,
among “ethical” consumers, De Beers doesn’t have much credibility (fairly or
no).
So, then, what is the “selling proposition” of the
Forevermark? According to its website, the “Forevermark
Promise” insures that its gems are “special” and “cared for throughout their
journey.” But will big retailers like Tiffany and Sterling want diamonds that
set themselves above the rest of their inventory?
Ultimately, Forevermark diamonds will need something unique and exciting that
makes consumers want them. As one industry marketer told me, people today aren’t going
to spend more for branded jewelry unless the design is something “fantastic,” or the brand has been
marketed so well that owning it confers prestige.
– One final point: Now that the De Beers advertising account
is being disbanded, what will happen to its greatest creation: “A Diamond is
Forever”? It is one of the industry’s most potent weapons, among the best-known
slogans in advertising history, but no one is really using it today. And it’s not
clear how it would play into a Forevermark campaign. (It’s pretty clunky to
say: “A Forevermark diamond is forever.”) But the word “forever” has
considerable potency in diamond circles: At one point, when the Forevermark was
being conceived, there was talk of “Forever stores.” Now that would have been interesting.
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