Innovative ways to sell diamonds - Novel Ideas

Unlike other hard assets, gold and diamonds are currency builders.However, the volatility in the gold prices hasstarted to make traders, retailers and consumers unhappy. The declining price reduces demand for the asset—hence the question arises—who wants to buy something when the price might drop? Similarly when the price begins to creep higher, end consumer refuses to purchase complaining about the rise in price. Soon, someday, inflation would soar, the value of paper money would collapse, and gold prices would skyrocket and the residents are thus not turning up to buy gold jewellery. The buyers have been apprehensive due to the constant fluctuation in the price of gold. Only those who have to buy jewellery for some occasion and cannot wait, are the ones who are actually buying jewellery. Most analysts believe the stage is set for more volatility in gold prices. Gold is also at the mercy of stocks. When equities plummet, investors are often forced to sell gold for cash, but any significant dip can trigger a wave of buying as investors purchase gold at ‘discount’ prices resulting in a strong tug of war for prices. Moreover, ever since the union finance minister has requested people to refrain from buying gold, people had been cautious. According to surveys, the decrease and the increase in the prices have affected the market badly and the gold jewellery sales had dropped drastically. However, this fluctuation has been favourable for the diamond industry. Hence consumers have increasingly been choosing diamonds over gold.

Diamond, as we all know is a product of indulgence symbolizing wealth, quality, and love for centuries, the diamond shares many similarities to gold. Yet, while gold prices have oscillated, the prices of diamonds are nearly flat. And though gold offers better use as a store of value and currency hedge, diamonds may begin to catch up as global demand increases and the gold/diamond ratio returns to its historical average. Gold is much harder to access when you need to access and the storage cost is much higher as compared to that of diamonds. Diamond market is much more transparentand consumers know what kind of polished stone they would want to purchase. The most popular reason to own diamond is as a hedge against inflation. The theory is as paper currency loses value, diamonds will retain its purchasing power, making it a safe place to preserve one's wealth. There are also behavioural reasons why end consumers are considering buying diamonds because, diamond just like gold has been the traditional form of savings among households for many years. So, one need not be as nervous about fluctuations in diamond prices as one would be when gold or bond prices move.

Now that traders have got the hint about increasing diamond sales, innovative marketing strategies have come to light. Jewels and gems last a long time, so good sales people are now considering diamonds and other precious gems as a good form of investments. Jewellery, and especially loose diamonds, can last forever and have more intrinsic value. A $100,000 diamond ring has more 'investment' potential than a $1,000 ring. We asked KalpeshVaghani, Director, Kapu Gems on his insight as diamond as an investment option and the ways to sell diamonds. To which he shared, "People should consider diamonds as mutual funds and like other investments. Considering it as an investment would be more convenient to the end user. Keeping a long-term goal as in the Systematic Investment Plans and mutual funds is a prerequisite for diamond investments. The consumer should have the confidence in diamond as they have in gold as a global commodity. After all, we are not just selling diamonds, but we are selling confidence. So to achieve utmost level of confidence about diamonds in minds of consumers— right and ethical practices should be followed in each and every aspect of business.”

It is said digital media is the future of any industry and therefore many jewellers are considering online portals to market diamond jewellery saying it is an innovative way to trade.Today’s online diamond industry has evolved into a marketplace of wholesale loose diamonds available to the public. The diamonds that are found online are not low quality diamonds that lack luster, but high quality diamonds. Many online jewelers have taken wholesale loose diamonds to the next level by offering ring-building services. Online diamond jewelers have cornered the market in wholesale loose diamonds.

When quizzed about the innovative ways to sell diamonds, KalpeshVaghani opined, "Selling diamonds or diamond jewellery through digital medium i.e. Internet is a good and innovative method. As, the world is getting closer with the help of the global web medium, it facilitates the marketing to a larger consumer base around the globe. Websites and the new trend of mobile apps is also something fresh and novel as the buyer can check all the qualities of a diamond and its other details on just one click."

When asked Dinesh Lakhani, Director, Kiran Gems about brands considering digital media as a good and effective platform to market, he surmised,“Customers today are well informed and connected. They intend to research before buying anything and they use their smart phones, tablets, laptops or PCs to gather information and shortlisting the brand. If a brand or company has no digital presence, then it potentially loses the opportunity to be on the buying list of the customers.”

With gold prices oscillating constantly, consumers are opting for diamond jewellery instead and hence sellers are not only coming up with innovative methods to convince consumers but are also coming up with different ingenious methods to sell diamonds. When quizzed about different strategies, Dinesh Lakhani answered, “We at Kiran found success in reinventing the existing systems with different standpoint. We see our retail partners globally reinventing the Jewellery designs, values, communication and presentation. They create a feeling among their customers of owning a treasure, which is eternal. And more transparency on the value that a customer gets and its appreciation would make them even more convinced. The only policy and strategy which would work best is the one which best suits customers. The diamond and Jewellery has to match their varied parameters like budget, design, investment, quality, service, value, assurance, etc. In our opinion the strategy, which focuses on these parameters of their target market, works the very best.”

Another incredible policy that sellers have come up with is the lifetime trade up and buy-back policy. Earlier such an offer was only applicable to gold. But sellers have astonishingly become generous towards diamonds aswell. Few buy-back methods that brands are coming up with are: Exchange your old jewellery and avail benefits or get a chance to exchange gold for certified diamond jewellery. Even 100 per cent buy-back policy has come to light.

When asked about this surreal scheme, Dinesh Lakhani stated, “Buy backs and other similar policies are highly personal to business types. It depends on their quality of products, lifetime value of their customer base, etc. What we can say is that it gives customers confidence of buying the product.”

To throw more light on attractive methods to attract end consumers to purchase diamonds, brands have also come up with easy installment plans and policies like ‘PAY LESS AND GET MORE’. Although such offers are always for limited period, they are definitely alluring customers towards loose diamonds and diamond jewellery.

Be it the technological medium or the buy-back policies, it is asserted that trust plays the most important role in selling diamonds. Only if the traders can foster trust amongst their clients, can any policy be of assistance to have a higher diamond sale.