While diamonds are certainly my favorite gems, many women are finding alternative types of gems to use for their engagement rings so that they can be unique without a diamond (of course every diamond is unique, and every woman can certainly find the right diamond for her, but as always luxury depends on how you interpret it). Luxist brought to my attention the particularly large (1040 carats) “Polly” emerald that is going up for auction on 29 August. Appraised for $454,000 by a GIA certified appraiser, it’s certainly too large for a ring, but it’s so unique, I could see many a Lambda be interested in purchasing it for his or her collection. The auction is open to anyone, with bids by phone or absentee bids with a $50,000 deposit.

I came across an interesting press release from the International Diamond Manufacturers Association (IDMA) this week calling for the international diamond manufacturing community to restructure diamond financing. They are worried because while demand for rough diamonds remains greater than the rough supply, the same cannot be said for consumer demand for polished diamonds, particularly in the US.

Stores are closing or having a hard time turning a profit, and the focus is on lower prices and lower quality. The supply of diamonds going to retailers will decrease, but for now consumers have not yet returned to retail stores. Nevertheless IDMA are calling for retailers to pay their suppliers fair prices, necessitating keeping their prices up for consumers. Said Moti Ganz, the president of IDMA:

“Consumers can still buy three pieces of diamond jewelry for the price of one Louis Vuitton bag. The price of diamonds today should be at least 200 percent more than their price in the 1990s. Just look where gold and platinum are and look where we are!”

Should we ask ourselves why the price of diamonds has not kept pace? Actually that’s the wrong question–there is no direct link between the price of rough diamonds (based on the internal considerations of the diamond industry) and the price of polished diamonds (dictated by the consumer of diamonds and diamond jewellery, a population that was forgotten by the industry).

In my view, luxury retailers must first understand why someone goes out and buys a diamond in the first place. In my PhD research, I found that luxury shoppers are looking to express themselves and connect with how they see the world. The better a retailer can help the luxury purchaser understand her goals and connect authentically to her values and personal qualities, the more successful the retailer will be. Walking out of the store, the lucky woman or man should feel empowered, special and unique, respected and feeling free.

Providing the right service doesn’t come easily. A jeweller should be able to detect first who the client is. A Theta woman seeks diamond to help her be ‘truly her’ in a world where most things are temporary and dependent on social setting and circumstance. A Lambda woman wants a diamond that helps her to be unique and genuine; her diamond is unlike any other diamond on the planet, an individual selection that will make her exceptional. As for price, do not underestimate yourself. If you fell confused, the only reason is that the offer of the diamond was not done correctly. When the luxury customer is presented with the right offer, he or she knows exactly what the value of it should be.

Following these values for many years we found that we can properly help the luxury customer, and together with our colleagues we were very successful doing so in the last 25 years. However, the diamond industry failed in respecting the need for luxury and tries to turn the luxury consumer into a diamond dealer when the effort should be done in the other direction.

We hope that we have enough practical knowledge to start offering the luxury consumer what he or she wants. We are aware that this practical knowledge is in the hands of very few people, yet the entire world could appreciate this freedom of expression and choice. Recently we started an initiative that will bring our message to the luxury customer and enable him or her to properly purchase his or her special and unique diamond that can fit only her or him. We will need your help to check our luxury hypotheses and to see whether what we say is really convincing you. In the coming days we will address you again and ask you to be our ambassadors to help us spread our important luxury message. Stay tuned!

Last August a team of diamond thieves stole 1,500 diamonds (in 43 jewelry pieces) worth £40 million from Graff Diamonds on New Bond Street in London. This week four of the thieves were found guilty of carrying out the raid, but the diamonds still haven’t been recovered. The two gunmen who had entered Graff Diamonds had handed off a black bag containing the stolen pieces to a motorcycle rider in a concealing helmet, who rode for two blocks then disappeared on foot in Green Park.

There isn’t much hope for finding the gems any time soon. Ivy Cutler, a diamond grader at the Gemological Institute of America, said

“I have spoken with Scotland Yard and the Flying Squad and we have them marked in our system. Sometimes pieces come back very quickly, sometimes it takes years. The criminals involved in this are extremely clever, unfortunately. I think they have probably changed hands many times and possibly been moved between countries. We can only hope the diamonds eventually turn up when an innocent buyer asks for their authenticity to be checked.”

The stolen diamonds were all certified and should be recognizable, but it’s possible that the diamonds have now been recut or falsely recertified. It will be interesting to see if any reappear, or if Graff would publicise their reappearance — my guess is probably not on both counts.

Diamonds from Marange fields in Zimbabwe have been all over the news of late. Diamonds from Zimbabwe are not currently certified by the Kimberley Process (which works to stop the trade in diamonds that finance conflict), and the Zimbabwean military has been accused of seizing control of these fields and organizing smuggling operations. There’s currently an export ban on Zimbabwean diamonds because they aren’t certified conflict-free, and this week the ban was upheld by Kimberley Process members, but Zimbabwe is now considering exporting diamonds anyway.

It’s a difficult situation, because if these diamonds were sourced ethically and formally allowed to be exported, they could greatly benefit Zimbabwe’s economy and put its diamond production efforts on par with Botswana. And while it appears that efforts are being made to improve the situation, Kimberley Process members weren’t confident that the sourcing of the diamonds met its standards because the fields remain under control of the Zimbabwean military, which is accused of committing human rights abuses in addition to smuggling the diamonds out of Zimbabwe.

A subgroup of the Kimberley Process is meeting next month to try to reach a compromise on Zimbabwe; we’ll have to wait and see if this impasse can be resolved.

Last year I wrote about Chanel and Net-a-Porter apps making it to the iPhone. Since then, more luxury companies are expanding their marketing efforts and finally embracing the online sphere. Today Tiffany launched a new iPhone app that allows people (I’d imagine primarily men) to easily browse Tiffany’s range of engagement rings.

While one can’t purchase rings directly from within the app, it does offer a decent amount of utility. Users can scroll through all of Tiffany’s different cuts, fixtures and collections for engagement rings — 44 combinations in all. You can also figure out what size you need by placing an existing ring on screen and matching it to a digital sizer. And if you need more help, you can call or set up a meeting with a representative from Tiffany from within the app.

The app doesn’t do anything more than what Tiffany already offers on its website, but by offering an app, I believe Tiffany will expose its rings to a larger number of (predominantly younger) luxury consumers who have iPhones. These consumers are discerning and like their luxury on demand–they should appreciate the ability to browse rings wherever they are. People can even design rings and then share them via email and Facebook. These sharing functionalities will appeal to Theta personalities who will want their ‘marrying friends’ to know that they fit in and are getting rings. That it’s still possible to design a very unique ring within the app will help it appeal to Lambda personalities.

Yesterday a rare 5.16 carat blue diamond was sold at auction in Hong Kong for $6.4 million, half a million more than the top price that Sotheby’s estimated. Terry Chu, deputy head of Sotheby’s jewellery department for China and Southeast Asia, said:

There have been a lot of new diamond buyers from mainland China, Hong Kong, Singapore, Taiwan and elsewhere in the region. I think after the financial crisis, the Asian buyers realized that the prices of diamond are relatively stable compared to other types of auction items.

It’s interesting that Asian buyers are so interested in diamonds (though it should be noted that the eventual buyer was Moussaieff Jewellers of London) — we’ve seen other markets beginning to heat up in Asia. This auction and the auctions for other diamonds from the De Beers Millennium Collection that will surely follow are yet more signs that economic recovery is underway.

If the the 39-carat diamond auctioned by Christie’s recently, which went for $5.4 million, is any indication, then the luxury jewelry industry may be bouncing back quicker than other industries.

However the New York Times is suggesting something greater: that the entire luxury jewelry industry may, in fact, be recession–proof. Mark Dunhill, chief executive officer of Fabergé, is quoted:

“During times of economic uncertainly real luxury comes back,” Mr. Dunhill said. At the same time, however, “there is a tendency to approach special purchases in a more discerning and discreet manner.”

Jean-Christophe Bédos, Boucheron’s chief executive calls the new approach ‘Beyond Luxury’: “[A] unique expression of excellence in design and craftsmanship.”

What Mr. Dunhill calls “real luxury” are the kinds of things that Lambda personalities prefer — the truly exclusive products and experiences that bestow status.

This is consistent with what some in the luxe industry are calling a return to the roots of luxe. I wrote previously that it’s possible the only way back for the luxe industry is to go exclusive. Not all agree, however it will become a strategy for some brands going forward.

Last week Christie’s Auction House put up for auction a 39-carat diamond. It was part of  the “Magnificent Jewels from a Distinguished Private Collector” auction.

Later this week Sotheby’s will auction a 29-carat flawless diamond. I wrote previously how that could set the tone for how the diamond industry picks itself up and carries on, post-recession. However it seems Christie’s has already solved that.

Rahul Kadakia, head of jewelry at Christie’s New York is quoted in National Jeweler saying that the Christie’s sale is indicative of an industry recovering quickly.

“The diamond market continues to show remarkable strength despite the volatility of the financial world … Just two weeks after a very strong sale of jewels at Christie’s Hong Kong–where a 5-carat pink diamond went for $10.8 million–the exceptional Evening Star Golconda diamond of 39 carats sold at Christie’s New York for $5.4 million. It was a fitting grand finale to a year that saw over $100 million in jewels change hands under our gavels in the U.S.”

We could be seeing a strong resurgence in the diamond industry, most notably at auction houses. If a 39-carat stone nets $5.4M, then one could hazard to guess that Sotheby’s 29-carat stone will net around $3.5. However reports currently have it pegged at going for $1.8 million to $2.2 million.

Regardless, it appears the Lambda personalities are out in force in the diamond market, ready to pay top prices for the most exclusive diamonds available to be bought.

Every week it seems a different luxe brand is making a push into China. This week it’s diamond retailer Tiffany & Co, with a new digital through-the-line campaign for its Tiffany Keys collection.

Media by Brand Republic has more:

This week, Tiffany unveiled its ’Journey behind the door’ online campaign, developed by Proximity Live and BBDO, in conjunction with a photography exhibition featuring mainland celebrities. The digital site, at TiffanyKeysPhotos.com, features a sample of the photographers’ works and includes community features, encouraging audiences to share their interpretations of the theme ‘Journey behind the door’ via BBS posts and photographs.

The new digital campaign is a different approach for luxe, which has previously avoided digital because of a perceived loss of exclusivity. But now that those same Lambda personalities who avoided the web are now practically digital natives. As a result, the luxe brands have less motivation to avoid it, too.

At its New York headquarters on October 19, Sotheby’s will take the diamond industry’s temperature when it auctions a 29 carat flawless diamond ring. The price it fetches will be telling of the state of the industry and the prices buyers have a stomach for.

Luxist is reporting that the price is estimated at $1.8 million to $2.2 million or $61,000 per carat. A flawless diamond of this size would be eye-catching to any Theta personality, both because of its rarity and overall perfection.

And while this is a truly remarkable diamond, it’s worth noting that this is yet another example of what I wrote previously about the industry forgetting the consumer. Other items included in the auction are considerably less expensive, with the next highest item expected to go for between $250,000 and $300,000.

It’s an industry test to see what kind of diamonds will sell in this climate and which will not. If the only diamond left standing is the 29 carat one, we’ll know the industry will and will not tolerate.