De Beers' advertising and marketing activity as reported by mass media

DTC
Diamond Trading Company (DTC) is the De Beers marketing branch. On the whole the DTC strategy for the year of 2007 as elaborated by the J. Walter Thompson agency consists in advertising and promoting but a single jewelry category within a period of time specified (the so-called media phasing). In general the 2007 гmedia plan looks as follows: the Journey collection is to be promoted via TV and press during February/May; in April/May the “right-hand ring” is to be actively advertised, with the  “anniversary three-stone ring” coming to dominate during the summer months when, as the concept authors believe, all kinds of anniversaries are frequently celebrated; the “right-hand ring” will be back in September and October when the new fashion season begins, with the pre-Christmas campaign scheduled for the middle of November.

The greater part of expenditures connected with TV and press advertisement fall to the share of the “Journey” collection pieces, still not well enough recognized with female consumers (in January only 20% of American women had some idea of it).[1]

In January in India the "Forever Indian” campaign started in support of the “Forevermark” diamond identification mark which it to last till October; according to the reports by the Indian press a sum of  150 million rupees has been allocated for the purpose. That is the way the company is to celebrate the «diamond» (sixtieth) anniversary of India’s independence and of the famous marketing campaign under the motto of Diamond are Forever.

The DTC concept provides for a special prize being monthly awarded to  a citizen of India to distinguish his or her outstanding achievement in  professional and social activity. In January it was given to the famous actor and political leader Amitabh Bachchan.[2]

In February DTC held celebration of the Forevermark Antwerp diamond marking line having been launched in Antwerp[3]. It has come to be the first enterprise of the kind to be located outside Great Britain.

THE PAST AND THE PRESENT
It is rather often that mass media of different countries cover episodes from “De Beers” history.

For example, the Chicago Sun-Times recollects the two decades after WW1 and during the Great Depression when the demand for diamonds steadily slacked off. With a view of solving the problem De Beers recruited N.W. Ayer to  launch a national-scale campaign (which, as the authors of the article emphasize, was a rare occasion at the time) for its diamond jewelry promotion.

Specialists of “Ayer” convinced Hollywood star actresses of the necessity to wear diamond rings in public and, as Edward Jay Epstein noted in his book The Rise and Fall of Diamonds, urged designers of fashion to join in the discussion of the «new stylish trend» of wearing diamond rings. During the period from 1938 to 1941 the volume of diamond sales increased by 55 %. In1945 it was a must with the “average statistical” fiancée to have not only a wedding, but an engagement ring as well.

The climax came in 1947 when a woman copywriter Francis Jerety coined the slogan A Diamond is Forever. The company illustrated the motto with a picture of happy newly-weds on their honeymoon. The amount of engagement rings sales kept on growing till in the 1950s, with the marriage of romance and convenience characteristic of the American wedding of the second half of the 20th century having become ultimately formalized.[4]

The “Jerusalem Post” reporters are of the opinion the slogan marked one of the most successful promotion campaigns in history and do not fail to mentioned it being ranked as the best advertisement slogan of the 20^th by the “Advertising Age” magazine.[5]

In this respect we dare remind the reader that some time later the slogan, slightly modified (“Diamonds are forever”) became the title of one of the novels by Jan Flemming that was eventually screened  with the film’s leitmotif song under the same title performed by Shirley Bassey. One may be inclined to believe that is the reason why the slogan still remains effective, after all the years that have elapsed.

The above statement is confirmed by the results of the poll undertaken by  the Luxury Institute (New York). In January the institute representatives questioned 500 individuals aged no more than 30, all of them belonging to families with possessions estimated at no less than  USD 5 million (per family). When answering the question concerning premium jewelry brands well known to them the respondents ranked “De Beers” as the third most recognizable brand out of the twelve variants offered, after Tiffani and Cartier.[6]

STARSAND JEWELERS
A thoughtful consideration of major jewelry brands' strategy of activity in connection with such significant  high life venues as “Oscar” or “Golden Globe” award ceremonies reveals active and eager cooperation  of jewelers’ houses with  stars: the former provide the latter with accessories of their own design to wear when threading on the  «red carpet» and sponsor fashionable parties.

However, jewelry industry specialists keep repeating almost unanimously that when doing all those things they never count on any more or less direct revenue. Thus the «Cartier» North American branch president  Frederick de Harp (in this respect it is worth mentioning it was “Cartier” that sponsored the events related to the  «Golden Globe» ceremony) when interviewed for the “Women’s Wear Daily” remarks  participation in high life is essential for a company for it helps attract the attention of would-be customers. But those that can afford premium quality jewelry are by far too fastidious consumers to become grasped with irresistible desire to obtain a pair of earrings only on account of having seen a  celebrity wearing something of the kind.

Joan Parker, consulting expert and ex-President of “Diamond Information Center”, “De Beers” marketing branch in North America, is basically of the same opinion; she says she would rather have  a tidy sum of money publicly allocated  for charity in return of a star actress wearing their jewelry at a venue (which the company actually did, eventually).

Parker deems the difference between the industries of fashion and jewelry consists in the fact that if a company working in the former sphere recruits a star to demonstrate its new models when appearing at a "red carpet” convention, it is most often likely neither to attract new customers nor urge the existing clientage to do more shopping: “It is nearly absolutely improbable. And this is a real marketing puzzle for most of the branch professionals”.

Alice Alston, De Beers North American branch president at the time (January) was even more categoric in her estimate and said the company's customers would most  likely be disappointed to see accessories of their brand worn by a star at a fashionable venue: “Why should one buy a new piece of jewelry if somebody else, a celebrity as it may be, already wears  a similar one?”[7]

The harsh reaction of the "De Beers” top managers is to some extent conditioned by the company being the one that “caught it really hot” in the course of the Blood Diamond comprehensive discussion. The British “The Daily Mail” bluntly stated in its coverage of the Golden Globe ceremony that De Beers was  “out of law” with Hollywood: “They do conform to no standard of ethics, my dear”.[8]

But by far not all the stars came to be discouraged by the stir created. The “W” women’s magazine reports on a number of celebrities present at the actress and model Mila Jovovich’s 31^st birthday party at the Gramercy Park hotel  which was sponsored by  the Diamond Trading Company.[9]

The 42-year-old model Linda Evangelista remains the De Beers company official image. Once she became famous by saying she would not even budge to get out of bed for less than USD 10 thousand, but now, keeping apace with the currently relevant trend with most supermodels, she gets involved in charitable activities.[10]

SHOPS AND CUSTOMERS
Alice Alston more substantially dwelt on the marketing and promotion policy currently pursued by “De Beers” in the jewelry trade sphere in connection with the third USA boutique of the brand being open in January in Las Vegas which became the sixteenth one in the ”De Beers’ retail chain). The lower limit price of  De Beers products amounts to USD 300, there certainly being  no upper limit applicable. “But basically our price remain within the range from USD 2600 (for an average ring) to USD 42000 (for a locket), - Alston comments. – the wide range of prices is one of the factors determining our success”.

It is a key aspect of De Beers’s policy of addressing the client that the goods on sale are displayed not in big glass windows, but in individual boxes of glass. Alsten emphasizes that it gives the customer a chance to examine every thing thoroughly and at any angle necessary. There is a label attached to every glass box with the price range specified for the collection in question indicated. Thus the customer is relieved of the necessity to ask the shop assistant too many questions and feels more at ease. “I believe many jewelry branches are too pompous and pretentious. I do not think it is good for the business”, -Alston remarks.[11]

The American The Record published an article on the study of aromas habitually used by retail trade companies to influence their customers in a certain way and bring them in the mood required. Its author remarks that the atmosphere of the De Beers American boutiques is satiated with floral and citrus scents and the green tea aroma[12]

DeBeers Diamond Jewellers Limited
Judging by the jewelry industry standards, “De Beers Diamond Jewellers Limited” (formerly -  “De Beers LV”) is a comparatively “young” joint venture of “De Beers” and a major  premium quality goods producer – “LVMH Mo[R]t Hennessy Louis Vuitton” of France.

In mass media publications the designer Neil Lane is referred to as the Jeweler of the Stars, Ice Age King and Ace of Diamonds. Among his Hollywood clients are Gwyneth Paltrow, Charlize Theron, Demi Moore, Elizabeth Taylor and many others.

Not long ago his work pieces were to be purchased only at his Los Angeles studio. But the designer that had been steadily shunning major investors taking interest in his brand recognized De Beers LV returning to the market as a would-be adequate partner. The debut of his cooperation with the company was the exclusive Hollywood Collection presented at the opening of the De Beers Rodeo Drive store in December, 2005. Now his collection pieces are on sale at “De Beers” boutiques in New York and London.

“Neil is an in-born jeweler and a person of weight in Hollywood. His assistance provided ‘De Beers” a foothold in the retail jewelry market», De Beers LV Director Guy Leymarie comments. – He is the one to have shown us the way into the world of premium brands”.[13]

In order to further consolidate the status of its jewelry brand the company decided to resort to assistance of the famous British jeweler Stephen Webster whose clientele list includes such names as Madonna, Elizabeth Hurley and Gwyneth Paltrow.[14] In June the new collection created by Webster specially for “De Beers” was displayed; the collection under the title «Burning Rocks” was that of men’s  jewelry decorated with raw diamonds.[15]

The company proceeded with extending its chain of retail stores. In January a new boutique came to be opened in Las Vegas; in May the company concluded a lease agreement for the building to accommodate its San Francisco store. According to data obtained from De Beers real estate partner company representative the diamond industry giant keeps on searching for suitable buildings within fashionable districts of the cities where it’s new retail sales outlets may be opened in the nearest future.[16]

In June the company started exploring the realm of the Internet by opening its first on-line shop De Beers.com which offers products within the USD 500-30000 range of prices. It is specially emphasized the on-line shop has been created for the convenience of the customers living in cities and towns where “De Beers” as yet has failed to open its chain stores .

The article published in the WWD features data on similar activity of  De Beers major rivals; it turns out that Cartier has hitherto  ignored on-line trade, unlike Tiffani.

Guy Leymary, head of the company, notes the fact that among the goods on sale on-line there will be pieces from the Talisman and Radiance designer collections, but they will be rather an exception, the bulk of the supply belonging to the comparatively moderate price category. “We would still like to invite the customers to our “non-virtual” shops in cases when the purchased product’s expensiveness or specificity of any other kind require lengthy explanation and detailed instruction”.

An essential element of the on-line sales campaign will be “De Beers” certificate that is a guarantee of the diamonds legal origin.

Opinions of branch experts on the above undertaking of “De Beers” clash.

In October De Beers is going to launch a watch production line  (in cooperation with specialists from Switzerland). The design of the watches will be basically that of the “Talisman” collection with major accent on the use of raw diamonds.[17]

SOCIAL RESPONSIBILITY

GENERAL CONCEPT
Stephen Lussier, De Beers Managing Director for external and corporate communication, revealed the company’s concept of social  responsibility in an interview given to the Modern Jeweler: “For “De Beers” social responsibility consists in basically and steadily enhancing the standard of living  of the population of   its business activity focus regions. De Beers is proud of the positive impact the development of diamond industry produced on the social life of the countries where we work, such as Botswana, South Africa, Namibia, Tanzania and, since not long ago, Canada”.

By way of actual example of social responsibility in action taken from the company’s experience Lussier recollects De Beers activity, in cooperation with governmental agencies of some African countries, World Bank and non-governmental associations, aimed at rendering the necessary help to  independent prospectors’ teams that undertake survey of alluvial sediments with a view of discovering and developing diamond deposits. De Beers announced its decision to allocate USD 2 billion to support the project of assisting the Tanzanian prospectors by providing them with adequate medical care facilities and creating the conditions for them to be able to sell the diamonds extracted at market prices .

Lussier declared all the accusations related to diamond extraction allegedly causing irreparable damage to the environment to be absolutely groundless, stating diamond extraction to be the most environmentally friendly mining industry branch. In accordance with the facts and figures cited by him only in 2005 the corporation spent USD 3.1 million on recovery and rehabilitation of natural ecosystems.[18]

Within the context of its activity in question in January the company granted USD 250 thousand for recovery of the territory around its South African mines. The funding was transferred to the Namaqualand Restoration Initiative (NRI) group that plans to restore the biodiversity of the territory forming part of the Karoo (South African plateau).[19]

MAJOR LINES OF ACTIVITY
In her article dealing with analysis of development trends of India’s diamond industry in connection with the Blood Diamond movie release Professor Alyson Warhurst (De Beers’s independent consulting expert on corporate social responsibility issues) dwells on the activity of the diamond industry giant in this country.

According to the data submitted by her in 1998 employment of children’s and teenagers’ labour decreased by 0.31 %. All DTC clients must give up employing children’s labour  and the 2005-06 period auditing revealed no such cases.

DTC-founded Bhansali Trust and other similar organizations actively work to fight such social diseases as poverty and children’s labour exploitation. In close cooperation with the relevant governmental agencies of India Bhansali Trust supervises the work of five schools attended by over 2 000 children, half of them studying free of charge. For many tens thousands of children that have no opportunity to go to school the organization develops and implements multiple educational programmes.

But DTC social welfare activity in India is not restricted to the above mentioned lines. Only in 2005 the company spent nearly 135 000 pounds on corporate social investment issues (for India, with the purchasing power conversion taken into consideration, Warhurst remarks, the sum is equivalent to 650 000 pounds). The projects are implemented mostly in the sphere of education and medical care. In 2003 “De Beers India” began cooperating with the LEPRA association of non-governmental organizations; its primary aim is providing medical aid to people suffering from leper, but recently, however, it has also been actively tackling the problems connected with eye diseases, malaria and AIDS.[20]

The cooperation of De Beers with the government of Namibia within the framework of the “Namdeb” project is often mentioned in the press as a characteristic positive example of socially responsible business. In accordance with the figures cited the company’s activity immediately provides for employment for some 3200 people, but, coming to take into consideration workers of the closely related enterprises and members of their families, one comes to the conclusion   that the number of people economically dependant on De Beers activity amounts to 40000.

Annually Namdeb allocates nearly USD 300 000 for implementation of target corporate social programmes in such spheres as education, small-scale business, medical care, social development and AIDS prevention campaigns.[21

Within the context of its social activity connected with fighting such maladies as AIDS, tuberculosis and malaria “De Beers” participates in the work of the Friends Africa foundation. It is Jonathan Oppenheimer that takes part in the latter’s events on the company’s behalf.[22]

In Botswana the Debswana Company in June initiated holding an agricultural exhibition and appropriated monetary funding for such venues aimed at the country’s agriculture revival to be held regularly.[23]

The company’s activity in Canada within the framework of the Victor project realization is a peculiar example of it fulfilling its social obligations. In this case the corporation and the country’s authorities primarily concluded a special agreement stipulating the project implementation conditions including rendering the necessary assistance to the population of the region affected, providing for their employment and ensuring the minimum employment quota specified for the local inhabitants (in the first place – Indians). The agreement provides for the company regularly accounting for its contractual obligations fulfillment.

In February 2007 the Canadian Northern Ontario Business cited the saying by “De Beers Canada” representative Tom Ormsby to the effect that 297 out of the 700 people engaged to perform the construction works within the site were Indians. The number of people employed varying depending on the volume and character of the work currently being performed; Ormsby assured that since the moment the work commenced minimum 70 % of the employees had steadily been representatives of the local North Ontario population, with no less than 400 of them being Indians.

Besides, the company allocated nearly USD 1.5 million for implementation of the social programmes specially elaborated to provide for the indigenous population’s  professional education and employment, transferred USD 800000 to the account of the Attawapiskate training centre and granted  USD 130 000 for  purchase of textbooks and manuals within the context of a special target programme  aimed at raising the educational level of children from Indian families. [24]

One more activity line paid major attention to by De Beers and its branch companies is promotion of sport.

In the year under report the company, for the first time during the recent thirty years, gave up sponsorship of the famous Ascott race.[25] Its authorities are reported to have taken the decision to quit the practice of supporting “elite” sports choosing to focus attention on more “democratic” ones such as football.[26]

Thus, Debswana sponsored a volleyball competition, stressing the fact it had promoted sporting activities in Botswana for some 40 years already.[27]

In June in Botswana the first performance of the Broadway musical Bye Bye Birdie took place. Debswana had spent 250000 pulas to make it possible.^[28]