The story of DeBeers

The beginning
Diamonds were found in the river beds in India and the jungles of Brazil and worn only by royalty Huge diamond mines discovered in 1870 near the Orange river, South Africa The major investors merge their interests into one single entity that controlled production and perpetuated the scarcity of diamonds

The beginning
The entity was called De Beers Consolidated Diamond Mines headed by Cecil Rhodes

It proves to be the single largest successful cartel arrangement in modern commerce

The flood

Diamonds had little intrinsic value and their price depended upon the scarcity The new mines would flood diamonds in the market and as a result the diamond would become a semi precious gems

Monopoly

Create a perceived need Convert tiny crystals of carbon into universally acclaimed tokens of wealth, power, and romance. Control the demand and supply Men and women were made to perceive diamonds not as precious stones but as an inseparable part of courtship and married life

Creating the illusion

De Beers had to endow these stones with a sentiment that would inhibit the public from ever reselling them. The illusion had to be created that diamonds are for ever That they are never to be resold

Meeting with the image makers

In 1938, Harry Oppenheimer met with Gerold Lauck president of the advertising agency in New York N W Ayers The agency was to prepare a plan for creating a new image for diamonds amongst Americans

Europe

In Europe diamond prices has collapsed during the depression In England and France the diamonds were perceived to be the jewel for aristocrats rather than masses

Pioneering persuasion

The agency suggested that a well orchestrated advertising campaign could have a significant impact on the social attitudes of the public at large and thereby channel the Americans towards larger and more expensive diamonds instead of competitive luxuries

The hook

The study revealed the need to strengthen the association of romance with diamonds since young men buy over 90% of all engagement rings It was crucial to inculcate in them the idea that the diamonds were a gift of love. The larger and finer diamonds, greater the expression of love.

The hook

Young women had to be encourage to view diamonds as an integral part of any romantic courtship The agency suggested strongly to exploit the new medium of motion pictures Movie idols the paragon of romance would be given diamonds to use as their symbol of indestructible love

Marilyn Monroe

Roll out of the plan

The link of diamonds and romance was reinforced through stories and photographs in magazines and newspapers Photographs would show celebrities with glittering diamonds on their fingers The British royalty would be used to foster the romantic allure of diamonds

Roll out of the plan

Painting by Dali, Derain and Duffy were reproduced to mould elite opinion that diamonds were like paintings a unique work of art

The psychological approach

To strengthen the tradition of the diamond engagement ring and to make it a psychological necessity (perceived need) By influencing the opinion of 70 million people above 15 years of age To create role models for the middle class wage earner

The psychological approach

Coverage of celebrities displaying diamond rings as symbols of romantic involvement Description of diamonds worn by movie stars An advertising campaign with the words a diamond is forever below a picture of two young lovers on their honeymoon expressed the theme of romance and legitimacy

Image courtesy of The Advertising Archives

The psychological approach

Informal lectures in schools about diamond rings Hollywood personalities a weekly service that provided information with description of diamonds worn by Hollywood stars

The psychological approach

The idea was to create prestigious "role models" for the poorer middleclass wage-earners. The advertising agency explained, in its 1948 strategy paper, "We spread the word of diamonds worn by stars of screen and stage, by wives and daughters of political leaders, by any woman who can make the grocer's wife and the mechanic's sweetheart say 'I wish I had what she has.'"

Success
In 1941 the advertising agency reported to its client that it had achieved impressive results, 55% increase in the sale of diamonds