Diamonds have an increased potential to “capture the luxury market share”, according to the third instalment of De Beers’ Diamond Insight Flash Report series.
The series of reports aims to look at the consumer perspective on diamonds, and how it continues to evolve following the pandemic.
The latest report includes a focus on consumer discretionary spend in light of the current reduction in travel spending, which has been the “key competitor” to diamond jewellery in recent years, particularly for the millennials.
The latest research from De Beers found that 44% of consumers had more disposable cash due to the cancellation of travel, dining or other experiences during the year.
When it came to travel specifically, more than two-thirds of consumers had cancelled travel plans for 2020 and of those, 55% had extra disposable cash as a result.
With limited travel options, one in eight consumers said they would instead choose diamonds to “mark a special occasion”.
The report also examined how consumer confidence has changed since De Beers Group began its research in March.
While consumer confidence was “relatively fragile” compared with previous research, the latest data found that 46% of consumers had an “optimistic outlook on life” for the next three months, while more than 60% said the pandemic had not affected their personal finances.
In addition, 46% said their jewellery spending was “back to normal”, with a further 25% expecting it would normalise in the next six months.
Bruce Cleaver, CEO, De Beers Group, said: “As some consumers find themselves with additional discretionary income as a result of spend in other areas such as travel being cancelled, there is potential they will allocate this to alternative purchases, creating something of a unique opportunity for diamonds.
“As a product that can be both experiential and meaningful, diamonds fill the temporary void left by travel in the way few other luxury products can.”
He added: “Diamond marketing themes that highlight these attributes are likely to be particularly well received by consumers who have additional money to spend due to their lack of spend on travel, and are looking to create a special gifting experience this holiday.”