The De Beers Group will keep prices linear for its Lightbox Jewelry brand following a recent experiment with lab-created diamond engagement rings.
De Beers recently confirmed that it had terminated a trial of lab-created diamond engagement rings, suggesting that the financial proposition was ‘likely unsustainable’.
Lightbox charges a flat $US800 ($AU1,245) per carat and $US1,500 ($AU2,334) per carat for its high-end collection.
Last September, De Beers confirmed that Lightbox was selling ‘lower quality’ lab-created diamonds at $US600 ($AU933) per carat.
David Prager, chief brand officer at De Beers, told Rapaport News that the decision to keep prices flat was reached due to consumer feedback.
“It was clear to us that above the $3,000 price point in the trial, there was less attraction for diamond engagement rings, and that below that, obviously, it’s going to be harder and harder to make a margin,” he said.
“What we saw very clearly was that [this] was not something consumers positively responded to. They liked the linearity; they liked understanding it.”
He added: “It was simple, and they didn’t understand why the linearity would break at a higher price point. So for us, linear pricing is going to continue to be core to the brand.”
Lightbox was launched in 2018 and operates out of Portland, Oregon, producing more than 200,000 diamonds annually.
Earlier this year, De Beers CEO Al Cook refuted claims that lab-created diamonds were ‘cannibalising’ natural diamond jewellery sales.
Prager also denied that De Beers had ‘legitimised’ lab-created diamonds as a category by introducing Lightbox.
“I have heard this idea that through De Beers entering the category, it somehow legitimised it. I reject that completely,” he said.
“People are buying [lab-created]; people are selling it. Our question [for the engagement-ring trial] was, let’s test consumer response to our proposition and determine through our own data whether we think this has long-term sustainability. And for us, it doesn’t.”
Last week, De Beers announced the launch of a $US20 million ($AU31.1 million) marketing campaign for natural diamonds in the lead-up to the holiday season.
The marketing will primarily target women in the US; however, it will be split evenly between men and women in China. De Beers recently published a report forecasting significant increases in demand for diamond jewellery in China in the next decade.
More reading
A diamond is forever: De Beers announces $US20 million campaign
Crash: Consumer demand for lab-created diamonds plummets
The Inevitable Rise of Hybrid-Diamond Jewellery: Embracing reality
Lightbox begins to offer lab-created diamond engagement rings
De Beers says lab-created diamond category ‘distinct and separate’
New CEO takes reins at Lightbox Jewelry
