RAPAPORT... Since the turning point of 2000, when De Beers strategic review dramatically changed the face of the diamond industry, many attempts have been made by industry players to create added value with marketing programs. Generally speaking, most companies rushed into the same kinds of projects and those that got it right — those who managed to recover their often-huge initial investments — represent a small minority.
Overseas Diamonds was one of the early marketers. The company first set up its Isee2 system, which was designed to help retailers show their clients the quality and the perfection of their ideal makes. Isee2 is now available at more than 200 retailers.
Dave Lapa of Overseas Diamonds explains the company’s latest marketing move — into what’s referred to as “viral marketing.” “Our goal is to be able to reach a wider target, and to do it in a new and unexploited way in our industry,” said Lapa. “The principle is quite simple. On our website, from now on it is possible to download a small Isee2 ad. Every month over a period of ten months, there will be a new ad available for our website visitors. Our hope is, if our projections are correct, that eventually the ad will be spread from computer to computer like a ‘gentle’ virus, transmitted by our viewers.” Obviously, here the word virus refers to the speed of transmission, rather than to any negative medical or infectious connotation.
The content of the ad itself, which in the case of Isee2 is rather humorous, is one part of introducing the Isee2 concept to potential customers. But the principle of viral marketing is the more important and innovative feature of the project.
Viral marketing is a relatively new concept — and an unfamiliar one to many marketers. Basically, viral marketing is:
• the potential to reach an astronomical audience,
• a process that can spread at light speed from computer to computer, with the approval of the owner, and
• a process in which the cost/contact ratio is negligible when compared to other more traditional marketing channels.
Lapa explained that “Our intention, at first, is to build up and reinforce the image of our Isee2 diamonds and system. First, we want to develop notoriety. The ten ads will be made available on our Isee2 site under a format that’s easy to forward. And our feedback is that the first ad already has been moving from computer to computer. Moreover, reports confirm that retailers are already using our ads to sell diamonds, which is one of the objectives we set for ourselves. We’ll do our best, but ultimately, it’s our customers who will decide whether Isee2 will be a recognized brand.”
BVGD Carries OnThe Belgian Association of Traders of Polished (BVGD) chose a new board of directors March 20, electing Andre Gumuchdjian as president, Vartkess Knadjian as vice president and Shashin Choksi as secretary. It was no surprise to read on BVGD’s official website that “The new Board of Directors is resolute in continuing its mission of defending a free, fair, open and competitive market for diamonds in the interest of all polished diamond traders in Antwerp.”
It also was no surprise to learn that barely a few weeks later, on April 6, BVGD lodged an appeal with the European Court of First Instance in Luxembourg against the recent decision by the European Commission (EC), arguing that the EC acted in a sense that is not fair to the trade or to the market. The BVGD alleged that “At a certain moment, the Commission apparently decided not to act in accordance with the line of conduct they had proposed, a decision that caused the BVGD demand to be rejected.”
BVGD’s quest for a “free, fair, open and competitive market in diamond trading [which] is essential for the future health of the diamond, as well as the jewelry industry” is the association’s overriding goal.
Who’s going to win this time? BVGD or De Beers? That remains to be seen.
The Marketplace
• Demand is good and there are even some shortages in clean goods in VS and up across the board in colors, sizes and shapes.
• Larger stones in 3 carats and up are doing well.
• The prices for 2-caraters are picking up slowly.
• SI, piqué goods in 30, 40, 50 and 70 are weaker.
• Fancy shapes in VS-SI in the better
colors are very strong.
• It’s been confirmed that growth is resuming in sales of rough and trade in general.
Article from the Rapaport Magazine - May 2007. To subscribe click here.