Lab-grown diamond companies are undermining consumer confidence in the diamond industry with their aggressive marketing strategies, according to Gaetano Cavalieri, president of the World Jewellery Federation (CIBJO). Speaking at the 2024 Global Gems & Jewelry Development Conference in Hainan, China, Cavalieri expressed concerns about the long-term impact of lab-grown diamond pricing and marketing approaches.
Cavalieri criticized the early decision to benchmark lab-grown diamond prices against those of natural diamonds, describing it as a “critical error.” He explained that the economic principles behind natural and lab-grown diamonds are fundamentally different. Natural diamonds have a limited production ceiling due to their finite nature, while lab-grown diamonds have no such ceiling and their production costs inevitably decrease as economies of scale are reached.
He further pointed out the negative impact of marketing campaigns that pitted lab-grown diamonds against natural diamonds, which he believes has resulted in a loss of consumer confidence in both categories.
“The jewelry industry relies heavily on consumer confidence,” Cavalieri said. “Without this, luxury products like diamonds lose their perceived value, and ultimately, they are just colorful stones.”
Cavalieri urged both natural and lab-grown diamond producers to rethink their strategies and brand their products in a more realistic and positive manner to restore consumer trust.