Long derided as cheap facsimiles of natural, mined diamonds, lab-grown diamonds are gaining a foothold in the fine jewelry trade.
In early June, as members of the fine jewelry industry descended on Las Vegas for the annual JCK show, the nation’s largest jewelry trade fair, they were greeted by banners at the city’s international airport advertising a new jewelry brand called Lightbox.
The ads—which showcased delicate pendant and earring styles studded with white, pink and blue diamonds—were remarkable for two reasons. First, the diamonds featured therein were lab-grown. Also known as synthetic or man-made diamonds, these stones are optically, chemically and physically identical to natural, mined diamonds, but they differ in one key respect: Lab-grown diamonds are manufactured in a lab over the course of a few days as opposed to deep below the earth’s crust over a few million years.
“We’re Prosecco, not Champagne; street style, not red carpet; for friends, not fiances,” explained Sally Morrison, head of marketing for Lightbox, during a packed press conference at JCK, where the company’s executive team made the case that consumers have expressed demand for lab-grown diamonds for life’s “lighter moments.”
Of even greater interest to attendees than the origin of Lightbox diamonds, however, was the company behind them: De Beers.
A Diamond Is Forever?
For nearly a century, De Beers has served as a de facto custodian of the market for natural, mined diamonds. From its London headquarters, the company presides over a mining empire that stretches from the historic Kimberley Mine in South Africa to the rim of the Canadian Arctic. Through an aggressive advertising campaign centered on its timeless, 70-year-old slogan, “A diamond is forever,” the miner has worked hard to ensure diamonds’ supremacy as a much-sought-after luxury item and enduring symbol of marital promise.
With the debut of its Lightbox Jewelry subsidiary, De Beers signals a startling departure from its core business in favor of a product it once shunned. The new brand will produce, design, manufacture and market jewelry featuring lab-grown diamonds in sizes up to 1 carat. With pricing that significantly undercuts its competitors in the lab-grown category, the company is readily communicating how much its gems cost: $200 for a quarter-carat stone, $400 for a half-carat stone and $800 for a 1-carat stone. (Settings in silver and 10k gold bump up the total price per piece by $100 and $200, respectively.)
Lightbox joins an increasingly crowded field. In late June, New York City-based designer and CFDA member Jennifer Fisher announced a collaboration with Diamond Foundry, a 5-year-old San Francisco-based startup that counts Leonardo DiCaprio among its investors, on a range of single 18k gold stud earrings featuring lab-grown diamonds in trillion, emerald, and keystone cuts.
“To align with Diamond Foundry’s unique production methods, I wanted to make something non-traditional,” Fisher said in a statement. “I see these studs as a bit more modern, to be worn mismatched. Customers will be able to make them their own and to accommodate this we will sell the studs as singles.”
Fisher is hardly the upstart brand’s only designer collaboration. Diamond Foundry has partnered with such respected designers as Nak Armstrong, Pamela Love and Eva Fehren. In 2016, the company teamed with Barneys NY on a jewelry showcase that featured the above-named designers’ jewels as well as lab grown-diamond set pendants from CVC Stones, a New York City-based company that marries found beach stones with precious gems.
The Wedding Market
Between Lightbox Jewelry and the Diamond Foundry collaborations, it would be easy to assume that lab-grown diamonds are strictly the province of fashion jewelry. But the truth is that until recently, most lab-grown diamond producers focused their efforts on the wedding market, much like their counterparts in the natural, mined diamond trade.
“Eighty percent of our sales are in the bridal category,” says Amish Shah, president of ALTR Created Diamonds, a lab-grown brand stocked by some of America’s largest retail jewelers, including Warren Buffett-owned Borsheims in Omaha, Neb.
“There’s a big space in the fashion category that they’re trying to take,” Shah says, referring to Lightbox and its ilk. “But we’ll stay in the bridal segment. Our diamonds are for the most precious moments.”
And therein lies the rub. Are lab-grown diamonds a lighthearted staple of the fashion jewelry segment, or a more affordable alternative to mined diamonds for brides who value size over how a diamond was formed? And can De Beers promote lab-grown stones for life’s lighter moments, while maintaining the market for natural, mined diamonds.
Diamond industry analyst Martin Rapaport—chairman of the Rapaport Group, founder of the Rapaport Diamond Report and the RapNet online diamond trading network—doesn’t think so.
Synethic Diamonds vs. Natural Diamonds
“The most important thing to understand is that wherever and however De Beers promotes and sells synthetic diamonds, they will be competing with natural diamonds,” he wrote in an opinion piece posted on Diamonds.net on July 4. “Furthermore, their claim that lower prices will push out or reduce profits of other synthetic producers only applies if they directly compete against the specific product categories of the other producers. Most of the producers are not in the fashion jewelry business; they are going after the engagement ring market. De Beers will have to go into the synthetic diamond engagement ring market. Otherwise their claims of economic benefit to the natural diamond industry are extremely limited to fashion jewelry.”
Source: Luxury Society