A diamond may be forever, but a synthetic one is, too. And so begins the ongoing debate between natural and lab-grown diamonds — stones with virtually identical chemical properties but very different back stories, marketing approaches and customer bases.
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Against all odds, lab-grown diamonds disrupted a millennia-long industry with incredibly rich lore and emotion, but all hasn’t been smooth sailing. Leading diamond conglomerate De Beers, which rolled out its Lightbox division of lab-grown diamonds for industrial purposes in 2018, soon added lab-grown jewelry diamonds to attract new customers and offer less pricey alternatives. But recent downward price pressures, partially from a glut from lab-grown competitors, has pushed De Beers to announce a pivot of all Lightbox lab-grown diamonds back to industrial purposes.
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In this podcast for Retail Rx, Lauren Parker, director of Fairchild Studio, chats with Stephen D’Aquila, senior vice president, Hilco Valuation Services, about lab-grown and natural diamonds, and how geopolitics, tariffs, shifting consumer sentiment and other factors are impacting the appeal of these beautiful — and sometimes controversial — stones.
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“The challenge with the diamond is you’re not able to add new features,” said D’Aquila, contrasting them with, say, electronics that keep customers back to buy the latest bells and whistles. “So there’s a downward pressure on price, because cost is coming down for competitors…and key players in China and India are producing large amounts of lab-grown stones. So with that, you’ve seen an erosion in price for lab-grown stones.”
But while lab-grown diamonds might attract Millennials seeking more ethically produced stones, they can also attract older customers looking to upgrade their natural diamond with a larger carat size. “I think you’re looking at positives and negatives, and a distinction between lab and mined from a customer standpoint and inventory holding level,” D’Aquila said.