De Beers - Diamonds last forever

De Beers made diamonds the symbol of love. They have been around for ages and have. Owned by Oppenheimer family - they have been the most profit making business for almost a century. The revenues have skyrocketed ever since they were founded and rightly said - it became what it is today because of a love story - the love of money.

De Beers has been around for a century and a quarter. They are the standard against which all other diamond manufacturers are measured. Eventually, things come down to the situation where they controlled the supply chain and the prices of the diamonds all over the world, the most powerful monopoly ever. Let's dive in to understand how they built their business.

“The mystique of natural diamonds has been built by the industry. One hundred fifty million carats of mined diamonds are produced every year, so they are really not that special if you look at those terms" - CEO of Gemesis Corporation

It was in 1869 when an 83.5-carat diamond was found near the 'Orange River' in South Africa. That discovery started the first diamond rush. It was a huge discovery which gave rise to the giant De Beers and the iconic slogan 'Diamonds are Forever'.

An English entrepreneur Cecil Rhodes started by renting out water pumps to the miners in the area during the Diamond Rush. As he started making money, he started buying claims and shares in smaller mines around. In 1888, he founded De Beers Consolidated Miners by merging companies and buying out all the smaller miners in thearea - to control the supply of diamonds in the market. De Beers became the only diamond mining company in the country.

In 1902, when Cecil Rhodes died, De Beers was producing 90% of the diamonds distributed and sold in the world. Another person namely Ernest Oppenheimer had made a name for himself in South Africa's diamond and gold industry. In 1917, he started a company called Anglo American Corporation.

Over the years, via Anglo American, he bought shares of De Beers and became one of the biggest shareholders of the company by 1926. By 1929, he became the Chairman of De Beers. De Beers was now under the control of Ernest Oppenheimer. But the demand for

diamonds had stalled in the 1930s.

In the late 1930s, the US was seen as the next big market for diamonds. The goal was to create campaigns to increase the demand for diamonds in the US. In 1938, Harry Oppenheimer traveled to New York to meet with the advertising agency N. W. Ayer with the goal to create campaigns to increase the demand for diamonds in the US. Since diamonds are hard to destroy, they came up with the idea of presenting diamonds as a symbol of love and romance and spreading this idea of diamonds. They started advertising diamonds as

a way of expressing one's love for another and successfully gave diamonds a new identity via print, radio, and the movies. The diamond sales in the US increased by 55% in 3 years.

By the end of 1945, only about 10% of engagement rings had a diamond. The campaign had such an impact on the minds of people that by the end of the 20th century, 80% of the engagement rings contained a diamond. De Beers was just not controlling the wholesale supply, but now they a control over the demand too. In 1947, they devised a plan to strengthen this idea of a diamond as a symbol of love. That year they came up with the

phrase - "A diamond is forever".

"We don't see synthetic diamonds as a threat, but you cannot ignore it completely" - Stuart Brown, Finance Director, De Beers

From the 1960s onwards, De Beers started exploring other countries and new markets to expand their business. Even in a tough market at the time like Japan, in the 60s and the 70s, De Beers managed to make a billion dollar market within a decade. By 1966, only about 6% of the brides in Japan had received a diamond engagement ring. That number increased to 77% by 1990.

The interesting thing about the campaign is that since diamonds had now become a symbol of love, romance, and "forever", the majority of consumers would not resale it - in a way, De Beers further controlling the supply and demand of the diamonds in the market.

In 1999, De Beers' slogan "A diamond is forever" topped Ad Age's list of 'Top Slogans of the 20th Century'. The next year, De Beers launched the brands: De Beers Diamond Jewellers and Forevermark to sell the diamond jewellery to consumers directly. In the 2000s, De Beers launched the brands: De Beers Diamond Jewellers and Forevermark to sell the diamond jewellery to consumers directly. In 2012, Anglo American plc, the company started by Ernest Oppenheimer earlier, completed the acquisition of De Beers.

De Beers relaunched their iconic slogan - "A diamond is forever" in 2015 for its brand 'Forevermark'. Over the last 80 years or so, De Beers built their entire empire on that one idea that a diamond is a symbol of love with having a monopoly in the market.