The Diamond Producers Association (DPA) has the mammoth task of changing the diamond narrative, according to Jean-Marc Lieberherr, the organization’s chief executive officer.
Initially, at least, that mission extends to how the diamond industry engages with millennials, who have become disillusioned with the idea that they’re simply expected to buy diamonds for an engagement or other occasions.
The DPA’s claim is that consumers are looking for real, meaningful experiences and products that are rare in today’s fast-paced lifestyle. “Real is Rare,” its tagline declares, concluding, “Real Is a Diamond.”
But Lieberherr is under no illusions. The DPA recognizes that the industry has lost some of its magic vis-à-vis younger consumers. Millennials, those 18- to-32-year-olds who make up the largest generation in the U.S., don’t have the same reference points for diamonds as previous generations did, he explains in a recent interview with Rapaport News.
“They haven’t been consistently exposed to a diamond-category message,” Lieberherr says, referencing the impact that the generic marketing of De Beers “A Diamond Is Forever” campaign had on previous generations. “It’s therefore important to craft a message that’s relevant to them.”
The industry’s failure to instill that message since De Beers ended its industry-encompassing campaign over a decade ago has seen diamonds fall behind in the luxury space. As demand consequently stagnated, polished prices softened and margins tightened.
Ultimately, the goal of the DPA’s campaign is to lift polished prices and allow margins to grow, Lieberherr says, asserting that this will empower the industry to restore profitability and invest more in marketing. The DPA hopes to see the direct impact of its campaigns on prices within three years.
To achieve that, it is focusing on raising consumers’ desire for diamonds.
“It’s not just about more people wanting diamonds, it’s about them wanting diamonds more,” he explains. “We’re a supply-constrained industry, so growth will be driven by price. We have to raise consumers’ desire so they’ll be willing to pay more for the product.”
For that reason, much of the messaging centers on increasing the perceived value of the diamond, rather than promoting it to a lot more people.
As such, Lieberherr stresses the long-term nature of the campaign: It’s about building the equity of the diamond brand and modernizing the consumer experience, rather than driving short-term sales.
While the industry spends an estimated $1 billion on marketing each year, mostly aimed at driving fourth-quarter sales, such campaigning is not effective if the consumer hasn’t heard from the diamond industry in nine months, he says. Instead, the industry needs to establish an ongoing dialogue with consumers, which retailers and brands can then use as a basis for their own traffic-building campaigns.
With that in mind, “Real is Rare” launched in last year’s third quarter and ended on Black Friday, when retailers typically step up their own advertising.
In assessing the immediate impact of “Real is Rare,” Lieberherr is pleased that the campaign has garnered high scores for appeal, comprehension and recall in its in-house testing. At this stage, the group is not looking at consumers’ willingness to buy; instead, it is working to make diamonds resonate with the younger generation and their sense of individuality.
“Consumers need to connect to what the diamond represents – [that] being underlying love and emotion – rather than the act of gifting a diamond,” Lieberherr says. “Millennials don’t want to be told what to do, so it’s very important to inject meaning into the act of buying a diamond.”
Those are the underlying drivers of the “Real is Rare” campaign, which launched last year. Millennials were its primary targets because they account for an estimated 50 percent of diamond jewelry purchases by value, Lieberherr points out.
The messaging also focused on commitments and romantic relationships, because that’s still the cornerstone of the industry.
Lieberherr affirms that other consumer groups – such as women self-purchasers, the fastest-growing category of diamond-buying consumers – and other gift-giving occasions will be tackled as the campaign develops.
It will also cover a more diverse range of relationships, such as older generations and those within the LGBT community, he adds, responding to viewer criticism that the initial campaign was fairly narrow in its representation.
“That’s the beauty of ‘Real is Rare,’” he says. “It can be extended well beyond millennials and beyond the idea of commitment or romance.”
The Year Ahead
The group is keeping that in mind as it plans the next stage of its campaign. The non-conventional nature of the relationships that the first two videos depict has resonated with the 18-to-24 age group, but less so with 25- to 32-year-olds, Lieberherr reports.
As such, the second phase of “Real is Rare,” which will roll out in September, will appeal to the more traditional inclinations of the “older” millennials, he says. A new clip, the third in the series, is due to launch in the second quarter, and the DPA is looking to expand its digital and social-media activities as well.
The DPA is also going international, planning a launch in India in September and an early-2018 roll-out for China.
Worthy of Diamonds
Just as importantly, Lieberherr says, the association will be engaging with retailers more this year, offering them a platform and support so they can relay its message at the store level. At the moment, the DPA is running a pilot program to hammer out the guidelines for letting retailers tap into its campaign resources.
Lieberherr is relying on that kind of collaboration with the rest of the industry to ensure the campaign’s success. In that vein, his organization is spearheading advocacy around three core messages: that diamonds are unique when it comes to expressing genuine emotion; that they’re inherently precious because they are natural and finite; and that they make the world a better place.
“Everyone should be thinking about the experience they provide their customers and ask if it is worthy of diamonds,” he urges. “Are you selling certificates, or beautiful natural stones that bring extraordinary emotional satisfaction?”
Ultimately, he says, “we all need to challenge ourselves to do justice to the diamonds we are selling and to the emotions of our customers.”