The sales arm of De Beers Group, the world's largest supplier of rough diamonds, has called on the industry to endorse an action plan to encourage growth and create consumer demand amid the difficult period the industry is facing.
"The bottom line is that although our core product, the diamond, is forever, there is no guarantee that the industry is," said Varda Shine, managing director of the Diamond Trading Company.
She noted that the industry has been undergoing one of its most difficult periods over the past few years.
"We are at the end of the era of the 'diamond is forever' brand strategy. Now the diamond industry needs to embrace a new era and invest into ways to distinguish its products and become more service-oriented and competitive," said Shine.
She put forward a three-point priority plan, she believes industry players should endorse to tackle the changes of competition and threats from the development of conflict diamonds that the industry was facing.
First, she said, the industry should unite and act together around certain principles of, for example, best practice similar to how the music industry fights Internet piracy. Second, the industry ought to invest in consumer-oriented marketing and advertising to suit customers' preferences. Third, the industry needs innovation in creating differentiated brand strength. "Only as we will see consolidation of the industry pipeline depressed profit margins will commence to recover," Shine said. In response to the increased worries about the current liquidity crisis and cashflow problems the industry is facing, Shine called for more transparency. "Rules of corporate governance will bring in a greater range of financiers coming into the industry," she said. Shine added that although De Beers was constantly reviewing its pricing policy for diamonds, it was not planning to lower its prices on rough diamonds. "We never promised to be the cheapest on the market. We look at pricing in the long-term and we don't act on what is happening over a month or two."
Separately, the biggest Canadian diamond supplier of rough diamonds, Aber Diamond Corporation announced at the Congress that it will open a representative diamond sales purchasing office at the Israel Diamond Exchange in Ramat Gan.
Canada is the third largest producer of rough diamonds after Russia and Botswana. The entry of Aber into the exchange is expected to ease the troubled Israeli market, which is suffering from shortage of rough diamond supply. Aber will be selling diamonds to Israeli customers on an annual sales volume of $70 million to $100m.
"I have much confidence in the Israeli diamond market for its historical and cultural ties and business ties around the world," said Robert Gannicott, Aber's chairman and CEO.