History of lab-grown diamonds
Since their invention in the 1950s, the gem & jewelry industry has perceived lab-grown diamonds as a threat to the natural diamond industry. Up until the 1970s, these stones were only suitable for industrial use. Since then, we have been able to grow larger and gem-quality lab-grown diamonds. Seeing this rise of lab-grown diamonds, many industry pundits predict the impending doom of the natural diamond industry.
The industry seems to think that the only way for synthetic diamonds to grow is at the cost of natural diamonds. Once the lab-grown diamonds are in the mainstream, who will buy natural diamonds, this prediction has fostered an adversarial relationship between the natural and lgd industries.
Claims and counterclaims
Companies make arguments for and against each product category based on what they are selling. The grown diamond industry claims that its products are ethical, sustainable & free from cartel pricing. On the other side, the natural diamond industry claims rarity, authenticity, resale value & empowerment of local communities. In reality, rather than helping, these arguments do more harm to both industries.
Lab-grown diamond’s whole raison d'être is natural diamonds. Think about it! If natural diamonds didn’t exist, can we use the current arguments to sell grown diamonds? Lab-grown diamonds are more ethical, better value than natural diamonds. We even base the pricing of grown diamonds on the price of natural diamonds. It is always going to be X percent cheaper than natural diamonds.
On the other side, the decline of natural diamonds didn’t start because grown diamonds entered the mainstream. We have been brushing problems under the carpet for a long time. For instance, ethical & environmental considerations. Even though in dealing with these issues, we have moved from denial to acceptance. We have not done enough and have failed to invest in our customers. For natural diamonds, a product whose raison d’etre is human emotion, we have relied on discounting to drive sales. Now, when we see our shrinking market share, we blame it on iPhones & vacations.
Instead of fighting each other, can we build on each other’s strengths and challenge each other to overcome our weaknesses?
The way forward
Drawing parallels from the fashion industry, let's take a look a closer look at the relationship between knockoffs and original products. We use the terms counterfeits & knockoffs interchangeably. However, there is a nuanced difference between the two. Knockoffs copy or imitate the physical appearance of other products but do not copy the brand name or logo of a trademark, while counterfeits do.
Counterfeits damage the reputation & sales of the original product. Knockoffs increase the sales & importance of authentic products. The people who purchase knockoffs develop an affinity for the original brands, leading them to buy the original at a later stage in their life.
When it comes to our industry, this selling counterfeits is akin to selling stones without disclosure. Sales of grown diamonds without disclosure cheat the consumer and also damages the sales of natural diamonds. When dealt with full disclosure, it has the same effect as knockoffs. Grown diamonds will spread awareness & affinity for buying the real thing in the audience who could not purchase it at the time.
Instead of spending money fighting each other as the NDC & IGDA are at the moment. We should come together and invest in the future. Jointly work on positioning & messaging. A Diamond is a diamond with unmatched beauty & characteristics. Natural Diamonds are indeed rare, created by mother earth over millions of years. At the same time, Lab-grown diamonds celebrate humankind’s ability to innovate.
We take advantage of lab-grown diamonds’ affordability to get a broader demographic of consumers to purchase jewelry instead of other products or experiences. This investment in creating a market for lab-grown diamonds will generate a payoff in creating an affinity for natural diamonds, translating into future sales of natural diamonds.
Just as when two businesses merge, there are redundancies where functions overlap. Which, in our case, would be cheap, low-quality natural stones. Even though difficult, it is a pill that we need to swallow for the greater good.
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