The Millennial and Gen Z generations combined accounted for two-thirds of global diamond jewelry sales in 2017, as diamond jewelry demand reached a new record high of US$82 billion, according to data published today by De Beers Group in its latest Diamond Insight Report. The sheer size of the younger generations, combined with their increasing financial maturity (millennial spending power is forecast to overtake Gen X permanently by 2020), provide significant opportunities to the diamond industry provided, as CEO Bruce Cleaver emphasizes, the industry evolves to ensure it reflects younger consumers’ values. "With their focus on networks and instantaneous information sharing within an increasingly connected world, today’s consumers want businesses to demonstrate they understand what truly matters to them. To meet this expectation, we need to listen closely to consumers, bringing with us innovative and thought-provoking propositions that set us apart from the rest."
According to De Beers' research, Millennials - people currently aged 21 to 39 - represent 29 percent of the world’s population and are the current largest group of diamond consumers. They accounted for almost 60 percent of diamond jewelry demand in the US in 2017 and nearly 80 percent in China. Gen Z, those currently aged up to 20, is an even larger consumer generation - representing 35 percent of the world’s population and will come of age as diamond consumers over the coming decades. Despite the generation being a long way from financial maturity, Gen Z is already making its presence felt in the diamond market, with the oldest Gen Z consumers (those currently aged 18 to 20) acquiring 5% of all diamond jewelry pieces in the US last year.
"Millennials and Gen Z are the most populous generations in the world today," says Cleaver. "Since their spending power is rising, they are important drivers of growth in the luxury sector and account for a considerable share of global diamond jewellery demand. While Gen Z are still too young to match Millennials’ spending power, they are tomorrow’s consumers and will increasingly affect the way marketers have to communicate with and engage their customers. The diamond industry needs to understand the younger generations to keep diamonds relevant, but should regard Millennials and Gen Z as distinct groups." The report highlights key similarities and differences between Millennials and Gen Z that have particular implications for diamond brands and retailers. For example, Millennials are in general more mistrusting, requiring brands to earn their trust before they can pursue growth, while Gen Z tend to be more individualistic and optimistic, desiring products that help build their own personal brands.
However, De Beers points out, there are also a number of important similarities between the generations, especially with regards to valuing love, being digital natives, being engaged with social issues and desiring authenticity and self-expression. Considering these similarities and differences, the 2018 Diamond Insight Report highlights three key areas of opportunity that the two younger generations present for the diamond industry:
CEO Cleaver ends with some positive notes: "It seems one thing the industry does not need to prove to young consumers is that diamonds are the perfect symbol of love. Those in the diamond sector must recognise that love may now be expressed in many ways, and diamonds may also be used differently to symbolise it, but the connection remains as strong as ever. With the younger consumer’s desire for qualities that diamonds can perfectly embody – including love, connections, authenticity and positive social impact – the most exciting changes will be ahead of us if we seize the opportunity to shape the future of the diamond industry." In short, the young generations are the present and future of the diamond industry: it is up to the diamond industry to adapt to their values, behaviors and way of life.