Newly engaged women flaunt their “rocks,” Marilyn Monroe sang about “a girl’s best friend,” and being “iced” is the style on the streets. Diamonds have become American icons of wealth and refinement, and while there’s no question that the little gems are something special—diamond is the hardest natural substance known to man—their status today has much more to do with marketing strategy than any inherent quality, and being aware of their history will help you sparkle with both intelligence and style.
Edward Jay Epstein, journalist and author of The Rise and Fall of Diamonds: The Shattering of a Brilliant Illusion (1982) and The Diamond Invention (1982), has written extensively about the origins of the diamond marketing strategy and the ways in which it has shaped our modern view of the gems. According to Epstein, diamonds were once a very rare commodity; until the middle of the 19th century, India and Brazil were the only two diamond-mining countries. But in 1867, a fifteen year-old discovered a diamond on his father’s farm on the south bank of the Orange River in South Africa and by 1882, African diamond mines produced more stones than both India and Brazil had in the previous 2,000 years. Suddenly, the market was flooded with diamonds, a problem for British financiers who controlled the mines because the price of the stones—which Epstein points out have no intrinsic value—depends entirely upon their scarcity.
Enter Cecil B. Rhodes, an eighteen-year-old asthmatic whose family sent him to South Africa in 1871 for his health. Together with his business partner Charles Rudd, they formed the De Beers Mining Company in 1880, and by 1888 had built a monopoly of South African diamond mines.
But Rhodes knew that controlling the diamond supply wasn’t enough; he had to control demand, too. He formed the Diamond Syndicate, an alliance of South African merchants who agreed to follow Rhodes’ lead in protecting their common interests: high prices and a public perception of scarcity. In 1926, a German immigrant named Ernest Oppenheimer bought De Beers and formed an even larger corporation, the Diamond Trading Company. Oppenheimer and his son, Harry, continued Rhodes’ efforts to create a worldwide monopoly. Especially after new discoveries of diamond reserves in Australia, Siberia, and Western Africa threatened to erode De Beers’ position as sole supplier, the Oppenheimers focused on maintaining the public perception of diamonds’ rarity by purchasing surpluses and launching a comprehensive advertising strategy.
Diamonds Are a Girl’s Best Friend
De Beers’ marketing strategy, at least by Epstein’s account of it, is alchemic: take a tiny carbon crystal and turn it into a universally-regarded symbol of love and prestige.
In America, where De Beers focused its marketing campaign in 1938 (Europe was on the verge of war), about three-quarters of diamond sales were already going toward engagement rings. But that wasn’t enough for Harry Oppenheimer; he wanted to make Americans buy more expensive diamonds. He traveled from Johannesburg to New York City to meet with Gerold M. Lauck, then-president of N.W. Ayer, the top U.S. ad agency at the time. After investigating the American diamond market, the Ayer staff recommended that De Beers strengthen the public’s association of diamonds with romance. Diamonds and love had to become inseparable; the finer the diamond, the greater and stronger the affection and regard.
Ayer chose the emerging medium of motion pictures to promote its message, encouraging movie stars to wear diamonds both on and off screen and movie studios to incorporate the stones into film scripts as symbols of everlasting love. Films and photographs showed Ginger Rogers, Katharine Hepburn, Bette Davis, and other female romantic leads, all paragons of elegance, decked in diamonds.
This psychological approach, in which advertisers indirectly formed an image around a product rather than directly pitching a brand, was the first of its kind. Thanks to Ayer, the sales of diamonds increased by 55 percent from 1938 and 1941 and the idea of the diamond as an indestructible symbol of romance, wealth, and power was firmly implanted in the American psyche.
A Diamond Is Forever
Creating an image is one thing; maintaining that image quite another. A key element of the De Beers business structure, according to Epstein, seems to be ensuring a stable market by preventing diamonds’ resale. In order to do so, and to expand the sale of diamonds beyond engagement rings, Ayer built a subsequent advertising campaign on the illusion that diamonds were “forever.”
A young Ayer copywriter named Frances Gerety wrote the caption “A Diamond Is Forever” in 1947 for a magazine ad depicting two newlyweds on their honeymoon. Within a year, the phrase became De Beers’ official slogan. Even though diamonds can actually be shattered, chipped, discolored, or incinerated, the company wanted to promote them as a lasting investment and symbol of eternal commitment.
The slogan served De Beers well in the mid-1960s, when the market again required restructuring to accommodate the discovery of diamond mines in Siberia. Once again, the challenge was to profit from the added supply without allowing a surplus to cause price fluctuations. (Oppenheimer cut a secret deal to create a single supply channel in exchange for Soviet partnership in the cartel.) There was also a problem of how to package the Soviet diamonds, almost all of which were under half a carat. Since De Beers had promoted large diamonds up to this point, there was no existing market for smaller stones.
To solve this problem, the company designed the “eternity ring” containing as many as twenty-five tiny diamonds for an entirely new market of older married women. The eternity ring was part of a larger strategy for small diamond sales, which emphasized quality, color, and cut over size, to promote the idea that all diamonds, regardless of size, signify everlasting love.
Diamonds in Conflict
Public attention on diamonds has been more negative in recent years. In 2000, the United Nations General Assembly unanimously adopted a resolution on conflict diamonds. And the 2006 film Blood Diamond brought the problem to mainstream audiences.
In Sierra Leone, Angola, Liberia, Zimbabwe, and the Democratic Republic of the Congo, rebel forces use rough diamond caches to finance arms purchases and other illegal activities that undermine peace efforts in these countries. They commit atrocities of murder, rape, and mutilation, ruling by terror. So far, international peace efforts have been unsuccessful; the only way to curb rebel factions seems to be cutting off their source of funds—diamonds.
As part of its 2000 resolution, the UN created the Kimberly Process Certification Scheme (KPCS), an attempt at regulating rough diamond trade. De Beers states that 100 percent of the diamonds it sells are now compliant with the Kimberly Process and its own Diamond Best Practice Principles. In a happy accident of symbiosis, the company reaps its own benefits from this policy; not only does the Kimberly Process relieve the consumer’s conscience, it also helps De Beers better control supply, an important part of its strategy from the beginning.
The Wealth of Knowledge
De Beers has proved its marketing strategy to be as powerful and resilient as the image of the diamond it’s created. And understanding all that has gone into making the diamond the icon it is today will help you make smarter choices about your jewels, especially when choosing an engagement ring. You may opt to break tradition and go for an emerald, ruby, or sapphire instead. But if you do choose a diamond, be sure to purchase one that is conflict-free.