Hope for the diamond industry

Isaac Mostovicz writes...

Over the past decade the financial situation of the diamond industry has badly deteriorated. As I said here, this is because the industry lost all contact with its customers. However, there is hope for revival if the industry will leverage recent developments to its own benefit.

Seven years ago, I participated in an emergency meeting organized by the leaders of the diamond industry. The industry had arrived at a standstill and banks refused to bankroll its operations anymore. This did not surprise me. For ten years preceding this, I had been warning my colleagues that this catastrophe was imminent. At this meeting I was challenged to present a plan to put the industry back on track.

Seven years passed and the industry went from bad to worse. The lack of cash flow is so severe that De Beers saw its first-half 2015 sales plummet by 21%. Worse, customers of De Beers have the right to defer 75% of the goods allocated to them for six months following the sale.

Nevertheless, I see a light at the end of this tunnel.  Recently, De Beers has announced a holiday marketing campaign to increase consumer demand for diamond jewelry.  Described as a “call to action” advertising campaign, it will target men purchasing diamond jewelry for their partners and is intended to “create a sense of urgency.” De Beers has finally recognized that the natural customer for diamonds is the married couple. Gone is the image it has cultivated over the past century of the young man on one knee, engagement ring in hand, as the ultimate diamond consumer.

For a long time, my partner Randy Pearson and I were aware of this truth. Over the years we have developed a marketing strategy that would fit the needs and wants of the married couple. Recently, we created a boutiqueoperation – Kahro Diamonds – in Raleigh North Carolina that is exclusively tailored to the married couple. We have created a unique toolbox founded on our extensive experience and supported by my academic research, which turns out to be diametrically opposed to the current best practices which are incompatible with the needs of a married couple.

Kahro Diamonds is a boutique operation, currently operating only in Raleigh, North Carolina. We welcome anyone wishing to learn more about serving married couples. Contact us at Raleigh@kahrodiamonds.com or 919- 649-6528. For those who cannot pay us a visit, I will publish some guidelines here to help you turn your business around.

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