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Four Challenging stages of the constant survival
Once emerged, synthetic diamonds faced a crisis that could be formulated as a challenge of "right for existence". Natural diamonds were marketed for centuries as an exceptional jewelry option, which could not co-exist with any alternative. Nobody can imagine that it is possible to grow a diamond in the laboratory. Although it happened, human mind continues rejecting ethical alternatives as an ‘unreal phenomenon’. It took decades to explain that thanks to technological progress people should not dig the Earth anymore to get the unique stone that is the same as its natural prototype.
Finally, the innovation deserved some level of buyers’ trust and entered the jewelry market. Yet, the synthetic diamonds industry faced a new challenge - the right to be acknowledged as a diamond.
The laboratory origin became a point for hot discussions that put the nature of synthetic diamonds and their features under a big question. Jewelers made incredible efforts to prove that origin, indeed, is the only thing separating synthetic and natural diamonds, which both have identical physical, chemical, and optical properties.
Happily, the issue was resolved in a legislative way by removing the word “natural” from the terminology apparatus as the only attribution of a diamond. Sure, it happened when synthetic diamonds came through numerous gemological tests and observations, which were called to prove that they could be certified due to the “gold” standards for diamonds - 4C’s system.
Fight for the hearts of people became the next challenge. We should say that having acceptance and some level of trust, the synthetic diamond industry managed to overcome this in quite an easy way. It seemed that young buyers, who thirst for innovative products and concentrate on ethically sourced options, have been long waiting for this alternative to natural gems. Synthetic diamonds quickly occupied top sale positions on the jewelry market and became a number 1 option for engagement rings. There was no surprise in such a rapid expansion since lab-grown diamonds have many comparative advantages.
We have already mentioned about ethical origin, but it is not the only factor. Price for the synthetic diamonds is twice lower than the price of natural diamonds. In addition, cutting-edge technologies, which are constantly improving, enabled the industry to satisfy a wide range of consumers’ requests. Any possible size, any possible color, any possible cutting. Such a flexible customizing opportunities have brought popularity to the man-made phenomenon.
The jewelry market was going through significant changes, with lab-grown diamonds experiencing a surge in popularity. While natural diamonds were facing a decline in demand due to their high cost, lab-grown diamonds with their affordability were selling rapidly. In 2018, man-made diamonds accounted for about 5% of global diamond jewelry sales. However, by 2022, they had surpassed the 10% mark of total global diamond jewelry sales, which came as a surprise to some market analysts who had expected this to happen in 2030.
Growing popularity means growing sales. Growing sales means growing production and growing risks for transparency. Overflooded markets required a better control system not to allow cheating. Here is a new challenge - the separation between natural and synthetic diamonds. This challenge was not only resolved but it also brought a significantly new approach to the certification segment. Gemologists found a way to find the difference between the two options, certify them appropriately, and launch many improvement processes. For example, the biggest problem for laboratories was the separation between fancy color diamonds. Now, IGI laboratory is able to distinguish between natural and synthetic diamonds. Experts started to use advanced techniques such as photoluminescence spectroscopy and Fourier transform infrared spectroscopy. This is a step to raise accuracy and transparency in the certification process.
The fifth challenge: Is it the end or a new beginning?
When the all issues seemed to be resolved, the analysts started to predict a new challenge for the synthetic diamond industry – Loss of worthiness and devaluation. According to the latest interview of analyst Paul Zimnisky, “he expects jewelry retailers to return their focus to natural diamonds this year”. Zimnisky explained this by the fact that man-made diamonds are not a phenomenon anymore. Today, nobody can be surprised by a huge size for the low price; the majority of people know that any huge diamond you wear can be a synthetic diamond; it is not unique and innovative like it was a few decades ago. The analyst predicts a decline in sales, but he expects a gradual decline with a small deviation from booming figures – approximately 1-2 percent a year.
Could it be true?
According to the research from PZ Diamond Analytics, global sales of synthetic diamonds increased to $US12 billion ($AU18.27 billion) in 2022, a 38 percent year-on-year improvement. It’s been a quite rapid rise in under a decade and sales of man-made diamonds sat at under $US1 billion in 2016 and, according to research from Tenoris, represent more than 17 percent of the overall diamond market today.
Due to consumers' feedback and retailers’ observations, people don’t buy synthetic diamonds because they are cheap; they buy them because it makes them feel good; it’s an emotional purchase. Considering the fact that emotions are the everlasting driving force, there is a chance that the popularity of synthetic diamonds will not end but can be just a little transformed.
Many analysts and observers confirm this idea. Another research showcases that the synthetic diamond industry is predicted to grow to a total value of $18 billion by 2024. However, with the prices of man-made diamonds expected to decrease, the industry is likely to attract a new type of consumer. According to Benjamin Khordipour, manager of Estate Diamond Jewelry in New York, man-made diamonds could potentially be viewed as "costume jewelry" in the future. Furthermore, expert suggests that lab diamonds will create their own market and will appeal to a different set of consumers for various occasions.
Indeed, retailers and leading traders like Madestones, do not agree with the prediction. They are sure that synthetic diamonds are constant survivals and the whole of their life span is closely related to constant struggle and coming through challenges. This challenge is just one of many others and for sure it is a new springboard for the industry predicting one more innovative turn in this story.
