“ A DiamondIs Forever” De Beers Ad Campaign: Case Study
Diamond Industry: Present Scenario• Global diamond industry is worth around $65 billion• U.S. leading consumer of polished diamonds• Retail sales over $ 30billion despite recession• 70% of the world’s diamonds cut and polished in India• Export of cut and polished diamonds down by 8 percent (near about $13024.53 million) in 2010 as against $14194 in India. Yet fastest growing diamond market today.
De Beers: Brief Overview• Founded in 1888 by Cecil Rhodes, it’s a cartel of 12 companies spread across the globe• Historically owned 85% share of the diamond market.• Infamous for influencing supply and demand to control prices - Purchasing and stockpiling same diamonds as other manufacturer - Flooding the market with diamonds similar to their competition that refused to join their monopoly• Diamond Trading Company (DTC) is the sales and distribution arm of the De Beers Group - Uses DTC as brand name and ForeverMark logo for marketting purposes - Exclusive De Beers boutiques operate in select countries• N. W Ayer & Son was De Beer’s primary advertising agency. Advertising Age named "A Diamond Is Forever“ best advertising slogan of the twentieth century.
• Losing its Grip on the Market In 1990s, several events happened: - Soviet Union collapsed, weakening partnership - Huge Argyle mine in Australia broke off from cartel - New mines in Canada discovered - Increasing popularity of synthetic diamonds•Market share fell from 85% to 45%• The Aftermath - Stopped trying to control market and instead focus on using its marketing and brand - Spent $180M on marketing in 2004 - Partnered with Louis Vuitton to open retail outlets• In 2003, earned sales of $5.5B and income of $676M
De Beers’ Marketing Strategy 1. To push the idea that diamonds were eternal, forever linked with romance, emotionally valued and a necessary luxury.2. To strengthen the tradition of the diamondengagement ring – “make it a psychologicalnecessity”
De Beers’ multifaceted advertising plan included…• Public Relations• Direct advertising in print and radio• Specific radio programs publicizing diamond trends• Weekly service called Hollywood Personalities which published stories in over 125 leading newspapers with descriptions of diamonds worn by major celebrities.
Analysis• Long term strategy – to change mindset and behaviour pattern of people rather than simply driving short term sales• Ads appeal to emotion rather than the product itself• Despite dire economic situations – Depression and the IInd World War – De Beers reinterpreted prevailing trends rather than fighting them