Wedding is a social tradition as old as time and now it’s officially one of the most lucrative consumer markets globally. People spare no expense when it comes to celebrating a lifetime commitment to their partners. Todays, the industry has reached $78 billion in the US and $298 billion globally.
The average age at which Americans get married is 28 for women and 29 for men, which means the millennials are the target demographics for all wedding players. If we look at the evolution of weddings, we can see a timeline of human progress and cultural shifts with each new generation that enters the ‘wedding’ zone.
And the millennials are just as interested in all the wedding planning but with different preferences and demands. Many diamond suppliers were terrified that the millennials wouldn’t be as interested in diamonds; but they’ve been proven wrong. The demand for diamonds has been steadily increasing, especially thanks to the continuously dropping prices. In 2019, the diamond prices experienced a 6% decline in prices.
So how are the millennials different in their diamond purchases and how has that influenced the market?
Buying online, just like everything else
Baby Boomers were not fans of buying diamond rings online. It’s such a huge decision both emotionally and economically; it didn’t sit right with most people to shop online. While the diamond industry hasn’t grown in digital presence at the same pace as other retail markets, the millennials are slowly yet surely changing that trend. Majority of people now at least start their search online and 10% make the purchase online.
Now you can go on sites, narrow down your search based on your preferences, and see all the options available to you in a matter of hours. This is why the rise in popularity in eCommerce sites such as DiamondStuds.com is not surprising. It also provides not-well-known brands to reach a much bigger customer segment at scale.
Given the increasing demand for customization, the next level we can expect to see is technology-based, custom-made orders happening online. The adoption of eCommerce model in the diamonds industry means that the precious stones will continue to get cheaper.
Demand for ethical diamonds leads to a new creation
While the diamond mining industry was dealing with oversupply of rough diamonds, some new disrupters entered the market to meet the growing demand the socially-conscious millennial consumers that the sourcing of diamonds to minimise its impact on the environment and laborers.
This led to the birth of lab-grown diamonds that not only made produced gems that were ethically sourced but also made production easier and faster. This new niche market grew rapidly, now accounting for 15% of the diamond sales.
Its growth is not expected to slow down anytime soon since its price is falling dramatically year over year. 70% of millennials are open to synthetic diamonds for engagement rings. Again, they are not afraid of trying something different.
Casual weddings and casual diamonds
The key difference between the previous buyers and millennials are that the latter shows higher preference for more casual weddings. White gowns are slowly losing their place as the sole option in bride wears with 6% of brides in 2018 opting in for wildly colorful dresses (it was 0% in 2015).
There are only a few high-quality gem brands that are recognised on a global scale such as Tiffany which many would still gladly pay a premium for the prestige.
However, more millennials want unique gemstones and customised diamonds and most of them do not mind brandless jewellery. Brand awareness does not matter to consumers as much since many of the players in the mid- or smaller-markets are mom and pop shops. This led to diversification of diamonds among the underdogs.