De Beers released its tenth annual Diamond Insight Report, focusing on the outlook for diamonds in China and how the industry can support long-term demand for natural diamonds in the country.
While consumer demand for diamond jewellery in China has softened in recent years following the Covid-19 pandemic and subsequent macroeconomic challenges, the report highlights the potential for greater demand as the economic outlook improves – with up to 200 million Chinese consumers set to enter the middle class by 2030 and an expected rise in household disposable income of more than a third over the same period – as well as how best to cater to the needs of different Chinese consumer groups.
The report reveals that while desirability for natural diamonds remains strong among Chinese end clients, ranking among the top three most desired luxury purchases, there is a gap between intent to acquire and actual acquisition rates. This gap represents an opportunity for the diamond industry which can be captured by responding to the consumer insights contained in the report.
Al Cook, CEO, De Beers Group, said: “De Beers Diamond Insight Reports draw on our unique understanding of diamonds, developed over our long history. And there is no country where history has moved as fast as China. From being a relatively small player on the world diamond stage at the end of the last century, China now represents the largest market for diamond jewellery outside the United States. So, our aim for this, our tenth Diamond Insight Report, is to focus on China. We aim to look at its development, to cut through short-term volatility, to understand evolving customer desire for jewellery and to identify opportunities for the future.”
The report identifies several specific opportunities for the diamond trade in relation to different consumer groups, geographies and retail approaches in China. Among the key insights revealed are:
- Millennials are the generation that spends disproportionately more than others on diamond jewellery.
- The share of market value Gen Z represents almost doubled between 2020 and 2022, from 5% to 9% of sales.
- Affluent consumers are more likely to buy diamond jewellery to celebrate significant relationship milestones, particularly wedding anniversaries.
- The important and growing 55-65 age group contributes approximately 9% of the total market value in Tier 1-3 cities. This demographic does not shy away from rewarding themselves with diamond jewellery (29% vs 17% for 18-54).
- The estimated market value of Tier 4 cities stands represented about 10% of total demand for diamond jewellery in 2022.
The report also includes the annual diamond value chain dashboard, containing authoritative data on the performance of the diamond industry’s upstream, midstream and downstream segments in 2022.