Natural colored diamonds are the kind of “uber-premium” product that appeals to affluent consumers, Diane Warga-Arias of the Natural Colored Diamond Association said in a seminar on “The Affluent Consumer and Natural Colored Diamonds” on Wednesday.
She noted that affluent consumers are where the industry should be focusing. “If you look at the top 20 percent of Americans, they control more than 80 percent of U.S. wealth,” she noted. “The top 10 percent ($300,000 and up) control 70 percent of our country’s wealth. The top 1 percent control 34 percent of the wealth.”
Warga-Arias mentioned the following ways to reach the affluent consumer:
Advertising. Warga-Arias noted that affluent consumers prefer an elegant “less is more” approach instead of ads that “tell them where to go.”
Better shopping experiences. “The 18 inches of counter space have become unimportant,” she said. “The environment of the store is the most important, the whole retail theater. It’s not a store, it’s a theater. That’s what the affluent want.”
An experience that provides stories. She gave the example of a restaurant inside a greenhouse.
Events. “I have worked with a lot of retailers and brands in the industry, and we have kicked it up a notch as far as events, but we are not there yet,” Warga-Arias said. “The days of just having an event with champagne, strawberries, and ‘good night’ are gone.”
Uber-premium luxury. “Price no longer determines whether something is an uber-luxury product,” Warga-Arias said, noting that you can rent high-price items on the Internet.
“If you are the first to have something, it’s critical,” she stressed, because people still want limited-edition items.
Regarding natural colored diamonds, she called them “unique,” “rare” and “uber-premium.” She also emphasized that they’re natural. “America is having a love affair with all that’s natural,” she said. It started with natural beauty aids. Natural colored diamonds begin with the word natural. The affluent want natural today.”
They also are perceived as rare. “Consumers understand the rarity of specific colors,” she said. “Everyone knows the Hope Diamond; the Hope Diamond is extremely rare. When a consumer goes into a store and sees natural colored diamonds, they are like ‘Wow.’”
In addition, at present there is no price list for natural colored diamonds, allowing for greater margins. “There is an elasticity there that allows merchants to be merchants again,” she said. “You are back to wondering, ‘How much can I get for this?’”
“Any retailer who is competing in diamonds that are also on the Internet, they are silly,” she added. “Natural colored diamonds are unique, each one is different.”