The songs “Diamonds are forever” and “Diamonds are a girl’s best friend” embodied the popularity for this precious gemstone worldwide. Nonetheless, diamond-mining companies, especially the De Beers Group, regional associations and various manufacturing companies have from time to time understood and conducted various product awareness programs among the consumers as a part of their marketing strategy. But how successful have these promotional initiatives been? What happens after the program concludes? Diamond World interacted with four of the industry’s leading personalities about their opinion on the generic promotional programs they have adopted to promote the diamond trade...

Gareth Penny, Group Chief Executive Officer, De Beers Group

Diamond World: Do you think there is a recall of the brand or even the product in the consumer’s minds after the program is over? If no, what do you think could be the reason? If yes, could you tell us the percentage of demand for diamonds and diamond jewellery after the program as compared to before it?

Gareth Penny:Our research shows that in year two after the launch year, sales for a new beacon always increase - and the same for years three and four. Because the average purchase cycle for a piece of diamond jewellery for heavy owners is 18 months, depending on where they are in the purchase cycle, we see many consumers coming to the table in years two, three and four after a product launch.

Diamond World: De Beers is the founding member of the International Diamond Board. Could you tell us what is the Board's current take on generic diamond promotion?

Gareth Penny:Diamonds do have to compete with other luxury goods and it is important that generic marketing continues. A significant part of the proposed International Diamond Board’s mission is to create and sustain strong consumer demand for diamonds worldwide. This would be achieved through effective category marketing that generates the best-sustained return for the entire industry and brings direct benefits to members.

Diamond World: What are De Beers’s future strategies and plans in generic diamond promotions? Do you intend to conduct programs in Asia, especially China and India?

Gareth Penny:Our focus in the US for this year will be on the Everlon Campaign again and in Asia on Forevermark.

Diamond World: After years of conducting generic diamond promotions, De Beers decided to withdraw from generic promotions and focus more upon promoting its own diamonds, especially the Forevermark diamonds worldwide. Could you tell us the current situation of the program with special reference to Asia?

Gareth Penny:In 2004, we piloted Forevermark in Asia where it received a very positive response. We successfully launched in Hong Kong, Macau, China, and Japan in 2008. The brand is now available in approximately 250 doors across Asia and this figure is growing rapidly with planned expansion into further cities in China. We also fully believe that Forevermark has the potential to be a successful global brand and we are looking forward to expanding our network of carefully selected authorized Forevermark Jewellers in new markets worldwide.

De Beers, established in 1888, is one of the world’s leading rough diamond companies with unrivalled expertise in the exploration, mining and marketing of diamonds. Employing more than 15,000 people from across the globe and operating from its mines across Botswana, Namibia, South Africa and Canada, the company produces and markets approximately 40 per cent of the world’s supply of rough diamonds.Gareth Penny, Group CEO of De Beers talks about the company’s generic promotion program plans of the past, present and future.

Diamond World: How important are the generic promotions for diamonds in today's scenario where diamond jewellery has to compete with other luxury goods?

Gareth Penny : Luxury products, including diamonds, have not been immune from the effect of the unprecedented global economic downturn of 2008/2009. However, we believe that diamonds are uniquely positioned to withstand the effects of the downturn for the following reasons - In uncertain times, research shows that consumers gravitate towards quality, they buy fewer, but better things – things that last, which are not disposable and that hold their value over time. Diamonds fulfill this need. Secondly, diamonds are a rare and finite treasure of nature and, with future demand growth in emerging markets, demand is likely to significantly outpace what is forecast to be lower levels of diamond supply for many years to come. Demand for diamonds has been consistently increasing for many years, and this is expected to continue in the long term – particularly as higher net-worth individuals emerge in the developing markets.

Having said that, diamonds do have to compete with other luxury goods and it is important that generic marketing continues. A significant part of the proposed International Diamond Board’s mission is to create and sustain strong consumer demand for diamonds worldwide. This would be achieved through effective category marketing that generates the best-sustained return for the entire industry and brings direct benefits to members.

Diamond World: What are the various generic promotional programs that the De Beers family of companies has organized worldwide in the past ten years? Could you give a summary of each promotion in terms of money spent for each program, the regions covered, the success of the program and the reasons for withdrawing the generic promotion campaign?

Gareth Penny: In the US, we have launched the "beacon ideas" Past, Present and Future or 3 stone jewellery, Right hand ring, Journey and in 2009 a closed model product launch with Everlon, a De Beers-devised joint marketing campaign with leading retailers. We do not disclose money spent on our campaigns, but each has grown the market significantly. We launch beacons into the marketplace, because we need to give consumers a new product concept with a supporting emotional story to fuel their continued acquisition of diamond pieces. In the US, much of the market is driven by what we call ‘heavy owners’. These women own eight to10 pieces of diamond jewellery and are always on the lookout for their next piece.

Freddy J Hanard, Chief Executive Officer, Antwerp World Diamond Centre

Antwerp World Diamond Centre (AWDC) is the official representative of the Belgian diamond sector. The organization manages the relationship between the diamond sector and government, and promotes the interests of the Belgian diamond industry worldwide. Freddy J Hanard, CEO of AWDC talks about the organization’s role in conducting generic diamond promotions in the world diamond centre.

Diamond World: How important are the generic promotions for diamonds in today’s scenario where diamond jewellery has to compete with other luxury goods?

Freddy J Hanard : Diamonds are an affordable luxury for everyone. A diamond is a timeless symbol of love, strength, wealth, eternity. No other product has so many facets and can compete with diamonds. A nice piece of jewellery or a simple solitaire can say all that the heart feels but words cannot express.

I think the common mission of the diamond industry should be threefold. First of all we need to ensure that demand is maintained and actively promoted. Secondly, we should focus on future generations and appeal to consumers of all ages and categories. Last but not least, we need to defend and confirm consumer’s confidence in the unique value that any diamond represents.

Diamond World: Can you tell us the major generic promotions for diamonds that you have had in Antwerp in the last ten years. How successful have these promotion programs been?

Freddy J Hanard: The Antwerp diamond community is heavily and actively involved in the development of generic diamond promotion. All the key players in this process are present here: two of the major mining companies are headquartered in Antwerp (Rio Tinto and BHP Billiton), a further two distribute directly in Antwerp (Alrosa and Harry Winston), and De Beers has a substantial number of Sightholders from Antwerp. AWDC is, through its many contacts, an active promoter of this concept.

*Diamond World:From the generic diamond promotions who of the two – retailer or manufacturer – benefits the most and why?

Freddy J Hanard: Definitely, everybody in the chain will benefit from a global strategy, but in my opinion, it is clear that the supply side, consisting of the mining companies and their direct customers, are the starting point for initiatives toward generic diamond promotion. They simply form a well-defined sector, relatively few in numbers but large in scale. In contrast, the retail end is very large in numbers and fragmented, making it more difficult to align all parties into one shared approach.

Diamond World: What suggestions do you give for improving the generic diamond promotions in Antwerp?

Freddy J Hanard: Antwerp is an important ambassador for our industry and we strongly support the creation of a specific industry-wide body that can be charged with this important task. We are convinced that India’s Gem and Jewellery Export Promotion Council (GJEPC), lead by Vasant Mehta, has the same vision and advocates a well aligned strategy for the future.

Diamond World: What are the mistakes that have taken place in the method of the generic diamond promotions? What are the major lessons you have learnt from them?

Freddy J Hanard: In my opinion no mistakes as such were made, it has long been clear to all parties involved that we share a common interest and need to work together. You could say that in the past, due to several reasons it has not been easy to bring all of those players in accord.

Diamond World:Can you tell us what your association’s plans and strategies are in promoting diamonds in the coming months?

Freddy J Hanard: Our main focus now is to continue to talk and eliminate all obstacles step by step, creating a solid generic marketing strategy that can battle all the challenges our industry faces, now and in the future. We, at AWDC, are very favorable to the idea of an organization that can coordinate the promotion of our magnificent product because after all, our diamonds can make anyone dream!

Eli Avidar, Managing Director, Israel Diamond Institute Group of Companies

The Israel Diamond Institute Group of Companies (IDI) is a non-profit, public interest company, which represents all organizations and institutions involved in the Israeli Diamond Industry. Eli Avidar, Managing Director of IDI gives his views on the importance of generic diamond promotions.

Diamond World: How important are the generic promotions for diamonds in today's scenario where diamond jewellery has to compete with other luxury goods?

Eli Avidar : Generic promotions are extremely important because of the huge competition from luxury items, not necessarily jewellery. Generic promotions will position the diamond in its place as a valuable product and a leading one among luxury goods.

Diamond World:Can you tell us the major generic promotions for diamonds that you have had in Israel in the last ten years. How successful have these promotion programs been?

Eli Avidar: We have not had generic promotions in Israel. Israel is a very small market.

Diamond World:From the generic diamond promotions who of the two – retailer or manufacturer – benefit the most and why?

Eli Avidar: Everyone will benefit. The whole pipeline will benefit and maybe it can stop the shrinking process of the pipeline, which started even before the global economic crisis.

Diamond World:What are the mistakes that have taken place in the method of the generic diamond promotions? What are the major lessons you have learnt from them?

Eli Avidar: The main problem is that the generic promotion has been going through a decrease in the last 10 years and we see the result in the decrease of interest among young customers. We simply need to start promoting diamonds again and in a language and values suitable for the current era.

Diamond World:Can you tell us what are your association's plans and strategies in promoting diamonds in the coming months?

Eli Avidar: We mainly promote diamonds through our international activities through public activities in some countries. China, India, Panama and more.

Sanjay Kothari, Convener, Marketing and Promotions, Gem and Jewellery Export Promotion Council

The Gem & Jewellery Export Promotion Council (GJEPC) is an all - India apex body for Gem & Jewellery representing 6,500 members. Set up in 1966, it operates under the supervision of the Ministry of Commerce & Industry, Government of India. The Council is primarily involved in introducing the Indian gem & jewellery products to the international market and promotes their exports. To achieve this, the Council provides market information to its members regarding foreign trade inquiries, trade and tariff regulations, rates of import duties, and information about jewellery fairs and exhibitions. In the second half of 2009, GJEPC held the first India Diamond Jewellery Promotion Program under the name ANANT. Sanjay Kothari, Convener, Marketing, and Promotions, GJEPC talks about the program, its success, the lessons learnt, and future plans.

Diamond World:How important are the generic promotions for diamonds in today's scenario where diamond jewellery has to compete with other luxury goods?

Sanjay Kothari : Generic diamond promotions are essential. Earlier De Beers did it for around 10 to 15 years; thereby we have been seeing 10 to 20 per cent increase in sales of diamond jewellery in the country. However, since two to three years, De Beers have stopped generic promotions and no one was doing it. We, as a Council, took this opportunity to promote diamonds under the banner of ANANT. It is a generic promotion of diamonds that is essential and required. The sale of diamond and diamond jewellery as an accessory or an investment needs to remain in focus. That is the whole idea.

Diamond World:How much do you think generic diamond promotions have been successful in India in the past ten years?

Sanjay Kothari: Prior to 15 to 20 years, the diamond market in the country was very small as compared to what it is today. Due to the promotional efforts by De Beers in the last 15 years, the market has been growing by 10 to 15 per cent every year. Today it has gone up more than US$ two billion. It is estimated that the India is probably the third or fourth largest country in consumption of diamonds after the United States of America and Japan.

Diamond World:From the generic diamond promotions who of the two – retailer or manufacturer – benefit the most and why?

Sanjay Kothari: The entire chain, which comprises mining companies, diamond manufacturers, jewellery retailers and the consumers, benefit from these promotions. Apart from being an adornment, fashion accessory and a symbol of love, trust and affection, if the prices of diamonds increase at a consistent rate of two to three per cent, it would be a little bit better from investment point of view resulting in increase of sales. So generic promotion is beneficial to the whole line.

Diamond World:ANANT was held from 19 September, 2009 to 14 February, 2010. Has the program helped in boosting diamond trade within India? Could you give the reasons?

Sanjay Kothari: Though ANANT was originally planned to run until Valentine’s Day, we continued the program until Akshaya Tritiya. I would not say the program was a great success story. The direct benefits are not so great. Any new venture needs to be given time of three years to get proper results. This was the first year so the program was initiated. It is also the first time in the history of the diamond industry anywhere in the world where mining companies, manufacturers, and jewellers have jointly made efforts to promote this product. The collective effort undertaken by the Council is beneficial to even the small jewellery manufacturers or retailers. Not everyone can spend huge amount of money. The program has to be done on a sustained basis for three years. What direct benefit people have from the program needs to be judged. We have heard that the participating retailers have benefited to some extent. The whole idea is to attract people to their showrooms that has succeeded to a certain extent.

Diamond World:What are the mistakes that have taken place in the method of the generic diamond promotions? What are the major lessons you have learnt from them?

Sanjay Kothari: Involvement of the retailers is necessary. They need to promote ANANT side by side their own promotions. Then only the program would benefit everybody. Just spending two to four lakhs of rupees and being a part of the program does not help. There is a need for the retailers to make their stores visible with ANANT. In addition, if the retailers are getting Sonam’s picture to use, what more do they want in this three to four lakhs of rupees. They can utilise the picture for six months to one year. The retailers have also to be proactive. Then it can benefit everybody. Yes, mistakes have been done. With whatever resources we had, we tried to spread across many channels, hoardings, newspapers, magazines, etc. We should have done it only in certain avenues. We will be taking care of that in the next season of the program. Other promotional effort that will attract consumers to the retail showroom will be looked into. Only advertisements are probably not enough to attract the consumers to the showrooms.

Diamond World:What suggestions do you give for improving the generic diamond promotions in the country?

Sanjay Kothari: We will try to convince people. Unless people and retailers do not become a part of it, ANANT cannot succeed. So more retailers should participate in the program. Otherwise, whatever amount the Council and mining companies spend is not going to prove beneficial. Every retailer or manufacturer has to put in money if they want to see the product properly sold. A godfather is not going to take care of you throughout your life. De Beers was there and they were spending money for promotions. At that time, we did not spend anything for promotions. Now, we will have to spend from our own pockets. This year too we will continue the program until Akshaya Tritiya. We will hopefully continue the program next year also, provided everyone joins.