Special guest blogger Randi Molofsky, longtime jewelry editor and author of A Girl’s Guide to Buying Diamonds, is here to give her impressions of the recent De Beers trip to London to spotlight the Forevermark, writes the JCK Magazine (www.jckonline.com) introducing the author’s narrative:
I hadn’t even left for London, but already, the trip was stressful: I realized my passport was expired just hours before boarding a flight bound for Heathrow. My destination: the De Beers Forevermark offices. After a last-minute scramble, I managed to get my passport renewed and promptly booked myself on the following day’s red eye. Upon landing at Heathrow, I was taken directly to 17 Charterhouse Street, where I breathlessly entered a conference already in session.
Bleary-eyed from the travel, I sat down at my appointed space and saw 100 uncut diamonds laid out in front of me, loupe and tweezers at the ready. Needless to say, that sure woke me up.
And so my crash course in Forevermark - De Beers’ new inscribed brand of diamond, sold only through authorized retailers - began. My mission was to explore exactly how retailers would be involved at Forevermark’s point-of-sale and whether or not the marketing speak was more gimmick than partnership. But first I had to learn what the Forevermark was all about.
To get up to speed, I joined the other students—a fellow trade journalist and two De Beers publicists—at the Forevermark Masterclass, an educational workshop led by Liz Mearing, head of retail sales training, and Gareth Jones, a Forevermark diamond expert. The hands-on session rehashed the 4Cs and basic diamond grading using De Beers’ rough and polished stones as benchmarks. Created for key retail ambassadors, the training has been designed to trickle down to sales associates in all local markets.
The following day, we were off to Belgium to visit the Forevermark Diamond Institute, a grading facility in the heart of Antwerp’s diamond district. Site manager Ilse Van den Bosch meticulously led us through each step of the journey, from arrival to inscription. The facility maintains about 5,000 diamonds, spread throughout its two floors. As you can imagine, organization is key. Marked only by a randomly selected number, each diamond is passed from station to station in anonymity in order to maintain the absolute integrity of the grading process.
Watching these diamonds go through incredibly rigorous trials was compelling, but after sitting through the experience, I realized that’s not the crux of what De Beers is selling.
Rather than promoting the quality of Forevermark diamonds—they are said to represent less than 1 percent of all graded diamonds—De Beers is hoping to re-contextualize the way the public sees diamonds. A Forevermark does not refer to a perfectly cut stone, nor one that has easily identifiable shapes and symbols in its pattern when seen under magnification. Rather, the mark promotes diamonds—available only in a range of pre-approved cuts, colors, and qualities—that have been brought from mine to market through a secure supply chain and have undergone accurate grading in order to give consumers the peace of mind to choose the stone that speaks to them.
In other words, because Forevermark diamonds are backed by a process designed to guarantee their integrity, customers are free to explore the inherent uniqueness of each stone in a new paradigm that places less emphasis on the 4Cs and more emphasis on partnering with their retail jewelers.
In part two of her report on De Beers’ Forevermark initiative, guest blogger Randi Molofsky, a longtime jewelry editor and author of A Girl’s Guide to Buying Diamonds, looks at what retailers stand to gain from the program.
A few weeks ago, I wrote about a trip I took to London and Antwerp in mid-May to learn more about the Forevermark, De Beers’ new inscribed brand of diamond, sold only through authorized retailers. The facilities and the training sessions were impeccable, but I couldn’t help feeling that I had been skewed towards the De Beers way of thinking. Yes, the company’s labs are impressive (and address many of the certification issues brought up by JCK senior editor Rob Bates in this blog post), but what do retailers actually have to gain by taking on the Forevermark?
There’s an exact answer to that question, according to Charles Stanley, president of Forevermark U.S.: about 10 percent in margin. “There really is no trick here,” Stanley says. “It’s a simple business model that builds value and allows you to sell your core diamond product at extra margin points.” He contends that in-market experience from Asia points to a 10 to 15 percent premium that is more than achievable here in the States. “From the consumer standpoint, this is an infrequent purchase,” he explains. “It gives them a clear and easy choice and takes away a lot of the angst involved in a major investment.”
Stanley points to three reasons why De Beers can actually command the markup: History, technology, and access. The years of support De Beers has given the diamond industry through advertising dollars is invaluable and no doubt continues to influence this generation of buyers. New proprietary technology at the Forevermark lab, including a color grading machine, means that De Beers is continuing to spend money to make the industry a safer place for diamond buyers. Finally, a practiced understanding of how to capitalize on advertising, red carpet placement, and celebrity endorsement means that the project was blessed before it even began.
What’s more, De Beers seems to be embracing transparency more than ever. Stephen Lussier, CEO, Forevermark, acknowledges that treatments, enhancements, and synthetics are becoming more of a threat every day. “A big part of our plan going forward is investing in the science of diamonds, and we feel we must do this for consumer confidence,” Lussier explains.
Does it all sound too good to be true? For many retailers, it will be. Before the start of the JCK show in Las Vegas earlier this month, De Beers had only identified 11 retail partners who are actively buying Forevermark goods. Although a sales team is currently reaching out to retailers who they feel meet the profile to sell ultra-premium diamonds, the club is still invitation-only.
Aiming for a fourth quarter 2011 launch, the product strategy remains focused on the core categories: bridal, solitaire, and classic. Design-neutral jewels will be shown in advertising, and each retailer will work with its chosen diamantaires to place Forevermark stones in its best-selling products, whether private-label or for inclusion in semi-mounts.
For those retailers who are invited in, the coveted De Beers ad dollars that come with being a Forevermark partner are tough to turn down. “We are offering the advantage of a margin premium and a national advertising campaign,” Stanley says. “Who else will be supporting you in the core diamond category?”
Who else, indeed?
