vasant mehta
TRANSCRIPT
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DIAMOND PROMOTION‘Need of the Hour’
Vasant Mehta
Vice Chairman, Gem & Jewellery Export Promotion Council
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ContentCONTENT
Evolution of The ‘Luxury Market’
Diamond – The Epitome of Luxury
Diamond Jewellery – Current Scenario & Growth
Key Market Trends
Diamond Jewellery Promotion – ‘Need of the hour’
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LUXURY
LUXURY Latin - Luxuria, means the extras of life
Something Not essential but conducive to pleasure
Something Expensive or hard to obtain
The extravagant Material things affordable only by rich
In simple words the opposite of necessity
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Only the best of the best earned the name of luxury
And luxury was defined from the point of view of the thing itself
The product’s attributes, qualities and features qualified the item as worthy of the luxury label.
e.g a Rolls – Royce
The ‘OLD LUXURY’ refers to an object
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FROM 1900 TO TODAY HOW DEFINITION OF LUXURIES ALTER
1900 → Model T cars, pianos, radios, hand-
cranked Victorians 1960 →Stereo sound systems,
35-millimeter cameras, Diamonds
1910 → Fur hats, electric clocks, fountain pens, Cadillacs, Kodak cameras, transatlantic
travel
1970 →Designer jeans,
VCRs, solar homes EXEMPLARS, Diamond Jewelry
1920 → Fur coats, movie “talkies,”
gin, vacuum cleaners, washing machines
1980 → Vacation homes, BMWs,
microwave ovens, Diamond Jewelry
1930 → Baseball tickets, canned
foods, indoor plumbing 1990 → Flat-screen computer monitors, Palm Pilots, cell phones, SUVs, Diamond Jewelry
1940 →Televisions, air travel,
college degrees, refrigerators 2000 → International vacations, Ipods
LCD televisions, Electronic Gadgets, Spa’s
1950→ Color televisions, credit cards, visits to Disneyland, Convertibles
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New luxury rather than representing an object is linked to a feeling
It is about the consumer’s experience
The ‘NEW LUXURY’
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Top Luxury brands
Top luxury brands
0
5
10
15
20
25
1
company
2005
bra
nd
val
ue
in $
mill
ion
s
Mercedes 20,006
BMW 17,126
Louis Vuitton 16,077
Gucci 6,619
L' Oreal 6,005
Chanel 4,778
Rolex 3,906
Porsche 3,777
Audi 3,686
Tiffany & Co 3,618
Hermes 3,540
Cartier 3,050
Moet & Chandon 2,991
Prada 2,760
Bulgari 2,717
Armani 2,677
Top Luxury Brands
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• Educated
• More demanding
• More selective ( buying behavior)
• Looks beyond brand and labels, archetypes of old luxury
• Seeks emotional satisfaction
• Has more disposable income, and desire to make his life easier and less stressful
Today’s New Luxury consumer
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Most popular items in personal luxuries
1. Clothes & apparel
2. Fragrances, cosmetics
3. Fashion accessories0 10 20 30 40 50 60 70 80
answers %
Automobiles & recreational vehicles
clothes & apparel
fashion accessories
fragrances cosmetics
jewellery
watches
pet products
none of the above
pro
du
ct
ca
teg
ori
es
personal luxuries
3 pre months 3 next months
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Most popular experiential luxuries
1. Dining
2. Travel
3. Entertainment
0 10 20 30 40 50 60 70 80
answers %
Travel
Dining
Entertainment
Spa,beauty treatments,cs
Home services
None of the above
serv
ices
cat
ego
ries
Experiential luxuries
6 next months
6 pre months
Diamond Jewelry significantly low in consumer preference for Luxury goods and Experience
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Diamond ‘The Epitome of Luxury’
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Origins of the engagement ring
Pope Innocent III1215
Fourth Lateran Council
Birthstones
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1938 19531948 1990s
Cullinan IX
Cullinan III & IV
Europe
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BUT WHY THE DIAMOND ?
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THE GREATEST MARKETING STORY EVER TOLD, BY MILLIONS
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De
De Beers 3 Stone RingDe Beers Wedding BandDe Beers ‘ICE on FIRE’
Signature Round Brilliant Pendant
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The Global Diamond Mining GiantInfluenced RETAIL SALES of
Diamonds
Introduced Diamond As ASPIRATIONS
The ultimate in Luxury
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1967 The DeBeers Goes to Japan
1978 Diamonds for 50% of Japanese Brides
1981 Diamonds for 60% of Japanese Brides
Case Study: Japan
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Diamond Jewellery
Current Scenario & Growth
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8 Key World Jewellery Consuming Nations
CURRENT SCENARIO
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28.7
31.9 31.5
34.01
26
27
28
29
30
31
32
33
34
35
2003 2004 2005 2006
Retail Sales of Diamond Jewellery in USA
USA
% GROWTH (over previous yr)
2004 : 11.5%2005 : -1.25%2006 : 7.97%
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8.5
8.75
9.76
10.14
7.5
8
8.5
9
9.5
10
10.5
2003 2004 2005 2006
Retail Sales of Diamond Jewellery in Japan
JAPAN
% GROWTH (over previous yr)
2004 : 2.94%2005 : 11.54%2006 : 3.89%
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KEY MARKET TRENDS& THE NEED TO PROMOTE DIAMOND JEWELLERY
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Diamond & Diamond Jewellery as a LUXURY and its prioritisation in the list of Luxury Goods in Consumer Mind space has been usurped by
other Products
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LUXURY TODAY
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LUXURY TODAY
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LUXURY TODAY
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LUXURY TODAY
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USA World’s largest DIAMOND JEWELLERY
consuming NationUndergoes RECESSION
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DTC reduces AD SPEND on
Generic Diamond Promotion
KEYTRENDS
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Emergence of a SUBSTITUTE
Synthetic Diamond
Reach US$ 2Bn at wholesale by 2015, almost 7% of the market
Usurp close to US$ 6 Bn of natural diamond sales at retail level by 2015
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While other Luxury Products are growing and
expected to grow at 10% – 15%
Diamond Jewellery will be the slowest growing
segment at a CAGR of 3.3%
Source – KPMG Vision 2015
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In 1960, Shift Happened• Diamond Jewellery• Automobiles• Clothing & apparels• Cosmetics and beauty
products• Travel & Tourism
In 2006, Shift Happened• Mobiles• Travel & Tourism• Automobiles• Clothing & apparels• Cosmetics and beauty
products
TOP 5 LUXURY PRODUCTS
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In 2015, We Can Make the Shift Happen
Diamond JewelleryMobiles
Cosmetics and beauty products
Clothing & apparels
Travel & Tourism
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NEED OF THE HOUR
I call upon all stakeholders to unite together and drive the generic promotion of diamonds and
diamond jewellery worldwide zealously to drive the growth of the category
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