The 2018 Symposium’s finale, the Futurescape Forum, brought together six industry leaders in a panel discussion moderated by Dr. David Ager, managing director of executive development at the Harvard Business School. The panelists were Bruce Cleaver, CEO of the De Beers Group; Gina Drosos, CEO of Signet Jewelers; Jason Goldberger, CEO of Blue Nile; Andy Johnson, CEO of Diamond Cellar Holdings; Rahul Kadakia, international head of jewelry at Christie’s; and Kent Wong, managing director of Chow Tai Fook.
The forum began with an industry forecast via video from Scott Galloway of the NYU Stern School of Business. The discussion centered around several key points:
- Technologically driven changes in retailing and trading, and continued consolidation across the value chain. These market shifts include challenges from giants such as Amazon and an increase in manufacturers selling direct to consumers, bypassing traditional retail channels.
- Evolving consumer tastes and desires, including concerns over gem sources and sustainable production
- The need to appeal to a rapidly changing workforce
- Disruption caused by laboratory-grown diamonds, both in the marketplace and in laboratory testing and identification
There was broad agreement that retailers must adapt to technology, not just in sales channels, but in ways it can help individualize each customer.
Drosos explained that omni-channel retailing is a necessity because customers routinely cross channels in their shopping experience, starting online and ending in the store. Online channels can enhance the in-store experience by making it possible for customers to make appointments online—90% of such appointments result in a sale, she noted.
Wong said that 15% of Chow Tai Fook’s sales by volume are done online, but mainly in small gold items and in charms such as Hello Kitty and Disney characters. At the high end, Kadakia said that 90% of Christie’s auction business is still done by traditional bidding, but the remainder is online, mainly from younger clients buying pieces under $10,000. “This is how we target younger customers,” he said.
A CHANGING WORKFORCE
The changing workforce was a key discussion point in the session. Businesses must adapt to a millennial workforce comprised of people who switch careers because they value diverse experiences and often do not want to stay with a company over the long term.
Goldberger told the audience that organizations should not become too insular and that people with diverse backgrounds bring new thinking. He added, “The reality of today is that tech people move every two or three years, so we have a choice: Do we lose them entirely or benefit from their talent while they are here?”
Cleaver noted that there are excellent opportunities to diversify the traditionally conservative diamond industry, while Wong said his company brings in gifted designers by offering them a platform to create and sell their designer pieces. “Talented people need that freedom,” he pointed out. Johnson added that not everyone wants to switch careers, and businesses must adapt to workers who cannot be on hand full-time.
NATURAL AND LABORATORY-GROWN DIAMONDS
Laboratory-grown diamonds occupied a great deal of discussion in the Futurescape Forum. Panelists agreed that while they have a place in the market, natural diamonds will still be the choice to celebrate life’s landmark occasions. Kadakia was confident that natural diamonds will remain the consumer choice because they will always have value, while synthetics will not hold value over time.
Goldberger noted that while today’s engagement ring buyers invariably prefer natural diamonds, we cannot take this for granted in the future. He cited the example of consumers who in the 1990s loved to browse bookstores but then deserted them for online channels. Cleaver said that synthetic diamonds’ place in the market was firmly in the “fun and fashion” side.
GEMSTONE SOURCING AND PRODUCTION
Cleaver also related the economic and political success of Botswana, once one of the world’s poorest nations. Diamond revenues, coupled with good governance, helped transform Botswana into one of Africa’s most prosperous countries.
As Cleaver noted, “It’s a story not always told—the good that diamonds can do in employing people and development.” Drosos said customers are interested in knowing the origins of their diamonds and that Signet is working to familiarize all employees with its corporate social policies regarding sourcing.