By Abe Sherman, CEO BIG
The gloves have indeed come off. In a recent article, Diamond Foundry has taken a shot at the entire natural diamond industry, specifically naming Tiffany & Company as well as all retail jewelers for selling Russian Diamonds: “Putin’s Diamonds”, as they call them.
“40% of all diamonds sold at U.S. retail directly fund Putin’s government” is how the article begins. YOU are all responsible for funding a dictator when you sell your diamonds, is the implication. That Russian diamonds have been available for decades is beside the point. YOU are funding Russia.
What’s up with this assault on the diamond industry? Might it have something to do with the upcoming launch of Lightbox? In little more than a month Lightbox Lab-Grown Diamonds will be available to consumers for $800/ct retail – a price far below those offered by the likes of Diamond Foundry, which list their 1.00ct RBC’s between $3,000-$3,800 for comparable “grades” to what Lightbox will be selling. For fun, you may want to peruse the Diamond Foundry website to see the range of qualities and prices – which are, of course, offered at something less than natural diamond prices… at least until September.
In another article on the Diamond Foundry website, their stated goal was to disrupt De Beers. Fine, I get the concept of positioning. But, I did find it curious to read, while their latest attack called out Tiffany as well as all y’all for selling “Putin’s Diamonds”, there was no mention of De Beers or Alrosa in their latest article (And what did Tiffany do to deserve this specific attention, I wonder?)
Perhaps with the recent attention on Russia and Putin, Diamond Foundry is trying to appeal to a segment of the market who don’t care much for Putin, and that’s the reason you should buy their goods. It is one thing to state they want to disrupt De Beers, but they are now going after you. All of you.
As we near the launch of Lightbox, first to consumers and then to retailers, I will watch with morbid curiosity how the likes of Diamond Foundry will hold on to the remaining vestiges of trying to establish value for their products in the consumer’s mind. It’s one thing to have positioned themselves as ‘green’ and 30% less than natural diamonds, but how will they explain that they are now selling for 4 times the price of similar lab-grown diamonds? Russia? Is that their play? They are clearly trying to carve out a niche for themselves – how transparent a company they are. How green. How “American”. Ironic that Lightbox will be manufactured 650 miles north of Diamond Foundry, but will be selling for a small fraction of the latter’s prices.
As you review the list of synthetic diamonds available on Diamond Foundry’s website, please note the J-K colors, and clarities as low as SI2. Lightbox won’t be selling J or K colors; just pink, blue and near-colorless whites that are very clean. I’ve seen them; they are very pretty and very inexpensive.
There is going to be a bit of a battle in this space and this latest blog from Diamond Foundry is just an example of how dirty it’s going to get. In my mind, using “Putin’s Diamonds” appears to be somewhat desperate.
I hope this newsletter alerts you to being prepared with answers for everything from global diamond sources to the differences between lab-grown and natural diamonds, especially regarding values. Educate your staff. Understand the differences between natural and lab-grown diamonds; they are not identical. Understand there is a significant difference in the prices of lab-grown vs. natural diamonds; which will become apparent when Lightbox is launched.
But, perhaps most importantly, you need to test every diamond in your stores, including repairs upon take-in. This is especially true for the inventory you have that is more than a year old – few manufacturers were testing the goods from their overseas factories as they are doing today. Have a written policy in place with all of your suppliers regarding penalties for supplying undisclosed synthetic diamonds. Finally, you need to be ready with your talking points for when either a consumer asks you the differences between natural and lab-grown diamonds (yes, they are synthetic) or when your local TV station shows up the week after Thanksgiving to ask you how to tell the difference between a natural and man-made diamond. Be the expert.