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Lucara revises FY 2022 revenue, sales, production guidance upwards

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Ali Pastorini: The white diamond is the equivalent of a white shirt for a woman

08 november 2021

ali_pastorini_xx.pngAli Pastorini is the co-owner of Del Lima Jewelry and President of Mujeres Brillantes, an association that brings together more than 1,000 women working in the gold and diamond trading sector, mainly from Latin America, as well as from Turkey, Spain, Italy, and Germany. The mission of Mujeres Brillantes is to help women in the jewelry and watchmaking sectors consolidate their business in order to exchange professional skills and experience. In the immediate past, Ali Pastorini was also Senior Vice President of the World Jewelry Hub in Panama.

In this interview with Rough&Polished she talks about the situation in the jewelry industry in the context of the COVID-19 coronavirus pandemic.

What are the main tasks and problems for MUBRI members today?

The main challenge for members is the same challenge for many jewelers in the sector, to understand and quickly adapt to the new way of consuming jewelry after the adversity that the pandemic has caused to many people. Another challenge for some members is to be even more efficient digitally, although they all understand that it is necessary to be efficient in digital to reach and retain their consumers, still many have difficulty in this digital relationship to maintain daily interest in purchasing products, in addition to distributing faster and smarter way.

The main task for each member to perform is to understand whether or not there has really been a reduction in consumption in their country, not to let themselves be influenced by the news. To understand this, it is necessary to leave your office and study customer behavior, understand their priorities as each country have a different economy speed. For example, at the moment when I answer your questions, we are in Dubai at the first international Jewelry Show held by GJEPC India, and the event was better than we expected as there was a high demand for goods and many purchases, mainly in diamonds and colored gemstones. Remembering that we brought retailers and wholesalers from various regions of Europe and Latin America, that is, there was a high purchase of goods by all countries within this Fair which shows everyone's spirits, and that business is flowing.

How has the pandemic affected jewelers in Latin America?

In Latin America, small companies and designers were the most affected and are taking longer to return to profit in their companies. Unlike large companies that went through the pandemic with few losses and have managed to sell and return to profit throughout 2021. Companies that already operated digitally before the pandemic, such as Del Lima Jewelry, managed to reach new customers faster taking advantage of a gap left by companies that were still operating only physically or had low digital presence.

It is noticed that even companies that are having difficulty in getting back to profit understand that crises will always exist and that versatility within the company is necessary. A brand that has only plan A is a brand that will be negatively surprised in a future crisis. This pandemic has taught everyone, even if in a hard way, that businesses need to be constantly changing for the most diverse demands. The small company or the designer tends to be preoccupied with short-term strategies, while the big companies understand that to you survive you must plan a long-term strategy with the ups and downs of the economy.

Interestingly, companies from countries that did not have a rigorous lockdown such as Mexico and Brazil are the companies that most managed to survive all the challenges because they managed to keep their offices, even with a smaller number of employees, in activity. While countries that made strict lockdowns such as Argentina and Peru are having a hard time paying their creditors and ended up losing customers who migrated to companies that were shipping products through their online stores.

How quickly will the jewelry industry recover from the COVID-19 crisis?

This is a question that is difficult to be precise as each company and each country are adopting different sanitary measures. When I restarted with my travels, I realized that there are companies that have already started selling on a larger scale than in 2019, and companies that will have difficulty in stabilizing themselves until 2023 or so.

I also must add the factor of change in consumer behavior, although there is a portion that seeks luxury products and will spend the amount placed in the showcase, there is a large portion of consumers who are evaluating whether what they spent before was really worth it, and they can change their consumption habits. This new behavior will certainly affect sales, which is why marketing and advertising showing empathy to this new moment will be essential to win new customers. I have seen other industries stepping up in their advertising strategies with this vision because they already realize that this new consumption habit is inevitable. The question is: What is your brand doing to show that it is non-disposable? Remember that people are starting to weigh up what kind of product makes a difference to their lives, they will constantly ask themselves what really makes them happy, that's when good advertising for your product will reconnect with them and win them over. They need to feel that your brand understands their desires. It's a daily and exhausting work that you'll have to do with your team but understand that СOVID-19 changes the way you do business a lot, and it's no use thinking things will be the same as 2019 because this evolution has already occurred, the question is whether you will insist on not seeing this or if you are already taking the appropriate strategies.

What is your forecast for colored diamonds' future in terms of demand in comparison to white diamonds?

It is a fact that colored diamonds have increased demand and purchase, I have seen some auctions with colored diamonds being successful, but I do not believe that in the short and medium term they surpass the search and purchase for white diamonds because the jewelry consumer still has a traditional profile and will naturally always look for key pieces.

The white diamond is the equivalent of a white shirt for a woman, that is, everyone needs to have it. I don't think this will change, I think colored diamonds will gain space in the hearts of customers but not to the point of becoming popular like white diamonds.

How popular are lab-grown diamonds now?

I've been saying for the last two years that it's growing due to all the assertive marketing and advertising they do, that is, they listen to the wishes of customers and turn it into stories that connect to the new reality. We as the industry know very well the difference from lab-grown diamonds to natural diamonds, but we don't have the patience and humility to teach our consumers about this difference. We think that because we are special, naturally the consumer has to know this. The result of this? We remain blinded by our pretense of thinking we are special and forget to communicate appropriately with the consumer, while lab-grown companies seem to have more patience and understanding in investing in campaigns that reach and delight consumers.

Lab-grown diamonds are not popular at the moment by accident or luck, they are popular simply because they understand that to win over the customer you have to dedicate yourself as a brand every day, you have to know how to communicate. I put myself in the position of the customer, if I didn't have the knowledge I have, maybe I would also buy lab-grown diamond because the way to communicate is much more attractive, objective and cheerful. Some of my industry colleagues can give a pragmatic answer, such as that lab-grown diamonds are cheaper and therefore more popular. This answer is easier, but it is not the correct answer. My brand sells pieces with only natural diamonds and the prices are much higher than brands with lab-grown diamonds, the difference that instead of we look to blame somebody, we understand this new game and adapt ourselves. You have to understand one thing, lab-grown diamonds will continue to be more and more popular, the question is what will you do to make your natural diamond piece more popular?

To what extent Pandora's endorsement of lab-grown stones devalues natural diamonds?

Pandora understood that there is a new market to explore, this does not mean abandoning the existing market. This Pandora endorsement of the lab-grown diamond will only take effect if we allow it to happen. I think our concern shouldn't be with endorsement but with learning how to market more to younger audiences.

I think that even natural diamond companies think that because the young person does not have the money to invest and buy a natural diamond, marketing should not be aimed at them as it is a waste of time but let me tell you one thing: "Isn´t a waste of time!". 

If you teach a young person and seduce him/her to get a natural diamond and make it essential in his life, today he/she for economic reasons will not be able to buy the natural diamond but this encouragement will serve him/her to want to get it sooner.

Young people get older, build careers and start to want to consume exclusive products. Keep focus on your current customer but also prepare your future customers to buy from you when they are able to. Do not start this relationship only when they have the right economic conditions, because surely another company will have already seduced them.

Аlex Shishlo for Rough&Polished