HONG KONG SAR – Media OutReach – September 20, 2023 – De Beers Group today released its tenth annual Diamond Insight report, focusing on the outlook for China’s diamond sector and how the industry can support long-term demand term of natural diamonds in the country.
While Chinese consumer demand for diamond jewelry has slowed in recent years following the COVID-19 pandemic and resulting macroeconomic challenges, the report highlights the potential for stronger demand to as the economic outlook improves – with up to 200 million Chinese consumers poised to enter the industry. social class by 2030 and an expected increase in household disposable income by more than a third over the same period – as well as how best to meet the needs of different Chinese consumer groups.
The report reveals that while the appeal of natural diamonds remains strong among Chinese end customers, ranking among the top three most sought-after luxury purchases, there is a gap between intention to acquire and acquisition rates real. This gap represents an opportunity for the diamond industry that can be seized by responding to the consumer opinions contained in the report.
The report identifies several specific opportunities for the diamond trade in relation to different consumer groups, geographies and retail approaches in China. Key information includes:
Millennials:
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Millennials are the generation that spends disproportionately more on diamond jewelry than others. Younger Millennials rate quality and purity as the most important feature they look for in diamond jewelry, followed by the size and cost of the piece. Design and color also play an important role in their decision making. For older Millennials, design and size are top of mind, followed closely by purity and price. For both groups, the uniqueness of a piece and the ethical responsibility of the brand are also determining factors. Retailers must therefore focus on a strong design philosophy with premium diamonds and competitive pricing, while ensuring they communicate their commitment to ethical practices.
Generation Z:
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Generation Z’s share of market value nearly doubled between 2020 and 2022, from five percent to nine percent of sales. Generation Z is characterized by increased use of digital media, increased interest in sustainability considerations, a continued journey toward financial maturity, and a propensity to purchase diamonds to mark birthdays. Retailers can maximize Gen Z’s potential by establishing strong digital touchpoints, showing alignment with Gen Z values, launching flexible payment options, or offering entry-level pieces at lower prices. prices, and offering special anniversary promotions or personalized pieces that make them unique. birthday gifts.
Affluent consumers:
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Affluent consumers are more likely to purchase diamond jewelry to celebrate significant relationship milestones, particularly wedding anniversaries. However, they are selective in their choices, with design playing a central role. One in four people who didn’t buy diamond jewelry in 2022 said they couldn’t find a design they liked. This may help explain the gap between the strong desire for diamond jewelry among affluent consumers and their actual acquisition – as such, a greater focus on designs that reflect the preferences of this group may present an area of improvement. opportunity.
Other growth opportunities:
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The 55-65 age group:
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The 55-65 age group constitutes a large and growing cohort, contributing around 9% of the total market value in Tier 1-3 cities. The personal purchasing behavior of 55-65 year olds is particularly notable . This demographic group does not hesitate to reward themselves with diamond jewelry (29 percent versus 17 percent for 18-54 year olds). In terms of product preference, this group shows a clear inclination toward non-bridal necklaces and rings.
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Tier 4 cities:
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The estimated market value of Tier 4 cities accounted for approximately 10 percent of the total demand for diamond jewelry in 2022. Diamond jewelry acquisitions in Tier 4 cities are more likely to be made without marriage (85 percent parts) and offered (88 percent). percent of pieces), with more than a third of acquisitions (35 percent) being intended for wedding anniversaries, compared to a quarter for levels 1 to 3.
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Al Cook, CEO of De Beers Group, said: “The De Beers Diamond Insight reports build on our unique understanding of diamonds, developed over our long history. And there is no country where history has evolved as quickly as China. a global player on the diamond scene at the end of the last century, China today represents the largest market for diamond jewelry outside the United States. So our goal, our tenth Diamond Insight report, is to focus on China. examine its development, to reduce short-term volatility, to understand the evolution of customer desire for jewelry and to identify opportunities for the future.
The report also includes the annual Diamond Value Chain Dashboard, containing authoritative data on the performance of the upstream, midstream and downstream segments of the diamond industry in 2022.
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