Can De Beers Diamonds Deliver Dramatic Dent in Gold Demand?

Most of my students read the ad and became sentimental. They went gaga over the father—how he was treating his daughter like a princess, how he was trying to break a stereotype, how he considered her a princess, and how he wanted to gift her a diamond on her 16th birthday.  Satiated, they fell back into their seats.  Their faces had the expression of a cat that had a bowl full of cream and was supremely happy.

I said, “Yes, very good. All that you said was seeing the trees and missing the forests. Do you really think that De Beers is the Government of India to fight for girl and women empowerment? Did any of you see the business angle? Every company is looking to make money. It is all about money. How does this ad make sense considering that DeBeers would have spent 40 Lakh rupees in putting out this advertisement?”

A whopping Rs 1,65,000 crores worth, or 802.8 tonnes of gold was consumed by India in 2024. Industry estimates say that diamond sales in India are only 20% of the gold sales. Just like Thums Up dominating Coke in India, in all other markets Coke is an undisputed king. Similarly, only in India do diamonds play second fiddle to gold in a country that worships the yellow metal.

DeBeers is the market leader in the diamond business and would like to have a bigger share in the very lucrative Rs 1,65,000 crore worth of sales that gold generates in India. India has always been a gold country, and the attraction is that gold is seen as a hedge against inflation and as Stree Dhan (a lady’s wealth), wealth that belongs to the lady (mother, wife, daughter). Gold is also seen as an excellent investment that offers a great return on investment.

Diamonds don’t have the above attractions for Indian women. It is only seen as an ornament that is used as part of gold jewelry. That is the perception that De Beers wants to change. Think of diamonds when you earlier thought about gold. A girl's birth, first birthday, first day at school, a girl attaining puberty, engagement, marriage, etc. Thus, this ad campaign of DeBeers is to change perceptions about diamonds. It is positioning itself straight against gold.

Similarly, in the 70s and 80s, motorcycle riders  in the USA had a macho image and an image of negativity because of movies and popular culture. The riders were huge, had tattoos, wore leather clothes, and were shown as tough people. Movies like Mad Max heightened and reinforced the image of this ultra-tough, macho bad man. Regular customers were shying away from motorcycles.

Honda wanted to change this perception and came out with a path-breaking campaign. "You meet the nicest people on a Honda." This campaign, where Honda showed people from different walks of life, aka respectable people, riding a Honda motorcycle, went a long way in changing the perception of a motorcycle being a  mode of transport of tough, bad people. De Beers is trying to do the same with its campaign: change perceptions. In a way, it is a generic campaign that will benefit all diamond sellers, and as a market leader, De Beers would profit the most.

De Beers, too has tried the perception change campaigns in the past. One of its iconic campaigns was the “A diamond is forever” campaign, but that focuses mostly on the engagement and the marriage segment. But in India, it is trying to trigger the heartstrings of the breadwinner, the father, assuming that he will do anything for the apple of his eyes - his daughter!

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