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The diamond industry is at an inflection point

McKinsey & Co Diamond Industry Report

Published

1 year ago

January 3, 2025

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This report by McKinsey explores the challenges and opportunities facing the diamond industry in the wake of several significant shifts. Here’s a breakdown of the key points:

Market Downturn:

Diamond prices have plummeted after a surge during the pandemic.
This is due to a combination of factors, including:
- Increased supply chain normalcy.
- Reemergence of traditional engagement timelines.
- Rise of lab-grown diamonds (LGDs) as a more affordable alternative.
- Growing consumer demand for ethical and sustainable sourcing (ESG).
- Sanctions on Russia, a major diamond producer.

Shifting Consumer Preferences:

Younger generations (Gen Z) are driving changes in diamond buying habits:
- More frequent purchases for self-reward.
- Preference for ethical sourcing and sustainability.
- Increased online shopping for jewelry.
- Growing interest in LGDs and recycled diamonds.

The Rise of Lab-Grown Diamonds:

LGDs pose a major challenge to natural diamonds due to:
- Lower cost (up to 80% discount).
- Perceived ethical and environmental advantages.
- Increasing quality and size availability.

The Future of the Industry:

The industry needs to adapt to survive:
- Natural diamond producers can:
  - Invest in traceability and ESG practices.
  - Highlight the unique value proposition of natural diamonds (rarity).
  - Consider vertical integration to manage costs and ensure compliance.
- LGD producers can:
  - Focus on further price reduction and technological advancements.
  - Address potential environmental limitations of LGD production.
- All diamond players can:
  - Develop innovative marketing strategies.
  - Embrace digital technologies for transparency and efficiency.
  - Build stronger partnerships for financing and branding.

Uncertainties Remain:

The long-term impact of LGDs on the diamond market is unclear.
Questions remain about diamond price volatility and ownership of the value chain.

Conclusion:

The diamond industry is at a crossroads. Adapting to changing consumer preferences, embracing technology, and addressing ethical concerns will be crucial for companies to ensure stability and longevity in the years to come.

The Diamond Industry: Navigating a Market in Transition

Insights from Changing Consumer Behavior, Technological Advancements, and ESG Imperatives

The global diamond industry, long associated with timeless luxury and tradition, is undergoing a seismic transformation. Once characterized by stability and predictable growth patterns, it now faces significant disruptions fueled by shifting consumer behavior, technological advancements, and heightened environmental, social, and governance (ESG) expectations. This article examines these trends, highlighting how diamond producers—both natural and lab-grown—can position themselves for sustained relevance and profitability.

A Market Recalibrated Post-Pandemic

The diamond industry experienced an unprecedented surge in prices during the COVID-19 pandemic, driven by delayed engagements, disrupted supply chains, and an increase in discretionary spending on luxury goods. However, this trend has reversed sharply, with diamond prices now at multi-year lows.

Several factors have contributed to this decline:

Rise of Lab-Grown Diamonds (LGDs): Offering affordability and perceived ethical benefits, LGDs have captured a growing share of the market.
Return to Pre-Pandemic Norms: Engagement and marriage cycles have resumed their traditional rhythms, reducing the urgency of purchases.
Sanctions on Russian Diamonds: Restrictions on Russian producers, including Alrosa, have altered global supply dynamics.
Increased ESG Awareness: Consumers now demand greater transparency and sustainability in diamond sourcing, putting pressure on traditional producers to innovate.

Shifting Consumer Preferences: A Generational Shift

Consumer behavior, particularly among younger generations, is reshaping the diamond market. Key trends include:

Ethical Sourcing and Sustainability:
Generation Z and Millennials prioritize brands that align with their values. Ethical labor practices, sustainable sourcing, and carbon-neutral operations are non-negotiable for these consumers.
Increased E-Commerce Activity:
Online diamond purchases are growing, with projections suggesting that nearly 20% of fine jewelry sales will occur digitally by 2025. The convenience and transparency of online platforms are redefining how consumers engage with brands.
Lab-Grown Diamonds as an Alternative:
LGDs are no longer confined to industrial use. They now represent a viable, affordable, and ethical alternative for fine jewelry, particularly in Western markets.
Self-Purchasing Trends:
Younger consumers increasingly view diamond purchases as a form of self-reward rather than traditional markers of engagements or anniversaries.

Technological Disruptions: LGDs and Supply Chain Traceability

Lab-Grown Diamonds: A Rising Threat

The affordability, scalability, and ethical appeal of LGDs have positioned them as the most significant disruptor to the natural diamond market. LGD prices, currently at an 80% discount compared to natural diamonds, have accelerated adoption among value-conscious consumers. Technological advancements have enabled the production of larger, high-quality stones, further eroding the exclusivity of natural diamonds.

Supply Chain Innovations

Traceability is becoming a central pillar for diamond producers. Blockchain technologies and other digital tools allow consumers to verify the origin, production methods, and journey of their stones. Beyond compliance, this transparency creates opportunities for storytelling, connecting consumers to the unique narratives behind their diamonds.

Strategic Imperatives for Industry Players

To navigate these challenges, stakeholders across the diamond value chain must adopt proactive strategies:

For Natural Diamond Producers

Invest in ESG Compliance: Ensure ethical mining practices, sustainable water use, and community engagement.
Promote Rarity: Highlight the uniqueness and natural origin of mined diamonds, leveraging these qualities as a counterpoint to LGDs.
Vertical Integration: Streamline operations to enhance efficiency and reduce costs while meeting ESG targets.

For LGD Producers

Focus on Innovation: Continue improving production methods to lower costs and increase scalability.
Address Environmental Concerns: While LGDs are marketed as sustainable, energy-intensive production processes must be optimized.

For Retailers and Midstream Players

Embrace Digital Transformation: Develop e-commerce platforms and invest in digital marketing to engage younger, tech-savvy consumers.
Offer Recycled and Vintage Options: Cater to the growing demand for sustainable and upcycled jewelry.

Looking Ahead: Uncertainties and Opportunities

The future of the diamond industry is far from settled. Several questions remain unanswered:

How will LGDs reshape market dynamics?
Can natural diamond producers justify their premium pricing amid rising LGD quality?
How will geopolitical tensions and regulatory shifts impact supply chains?

Despite these uncertainties, one fact is clear: adaptation is essential. Whether through technological investment, strategic partnerships, or redefining value propositions, diamond industry players must evolve to meet the demands of a changing market.

The industry is at a crossroads. Those willing to innovate, align with consumer values, and embrace technological advancements will not only survive but thrive in this new era.

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JB Insights

Valentine’s Day 2026: How Jewellery Brands Are Redefining Romance

From symbolic jewellery collection to sustainable sparkle, this season’s collections celebrate intentional love with meaning and modern elegance.

Published

21 hours ago

February 14, 2026

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What do brands in the jewellery industry have in store this Valentine’s Day 2026? This year, the focus has shifted from extravagant gestures to deeply personal expressions of love. Leading jewellers are embracing storytelling, sustainability, and symbolism—introducing heart-led designs, lab-grown diamonds, platinum love bands, and minimalist everyday pieces that reflect connection, commitment, and conscious luxury. Whether it’s a timeless solitaire, a contemporary toi et moi ring, or a delicate pendant meant for daily wear, the emphasis is on jewellery that feels intimate, intentional, and enduring.

Gargi by P N Gadgil & Sons

Gargi by PNG & Sons celebrates Valentine’s Day 2026 with delicate designs that honour modern love—thoughtful, expressive, and crafted to sparkle in every shared moment. Blending contemporary elegance with everyday wearability, the collection is designed for heartfelt gifting and self-expression alike. Because this season, love isn’t just celebrated—it’s beautifully adorned.

Senco Gold & Diamonds

This Valentine’s Day, Senco Gold & Diamonds presents a thoughtfully curated edit of romantic gifts from its Sennes, Everlite, Perfect Love and Aham collections, designed to celebrate love in all its forms. From minimal, everyday diamond jewellery in Everlite to expressive, emotion-led designs in Sennes, and timeless symbols of commitment from the Perfect Love collection, each piece blends craftsmanship with meaning. Whether you’re marking a new beginning or a lifelong bond, these collections offer elegant gifting options that feel personal, enduring, and effortlessly romantic.

Kalyan Jewellers

This Valentine’s Day, jewellery becomes more than a gift, it becomes an expression of emotion, connection, and personal meaning. From delicate heart-inspired motifs to contemporary designs accented with diamonds and subtle touches of colour, each piece is crafted to celebrate love in all its forms. Whether it’s a gesture of self-love, a symbol of a lifelong bond, or the start of something new, these timeless designs blend elegance with sentiment, creating keepsakes to be cherished long after Valentine’s Day has passed.

Malabar Gold & Diamonds

Malabar Gold & Diamonds introduces Zoul 2026 – Allure, a sub-collection within its Zoul 2026 range, centred on contemporary diamond jewellery with a clean, refined aesthetic. Designed for modern wearability, the collection reflects a growing preference for jewellery that feels relevant beyond occasion-led dressing.

The Allure edit features fancy-cut diamonds set in minimal, thoughtfully balanced silhouettes. With an emphasis on lightness and subtle brilliance, the designs are crafted to sit comfortably within everyday wardrobes while still offering a distinct visual appeal.

Dassani Brothers

Dassani Brothers has unveiled ‘Eternal Love’, a Valentine’s Day collection that reimagines classic solitaires with a modern, affordable approach. The collection blends luminous yellow diamonds, traditional solitaires, and innovative pie-cut setting diamonds to deliver brilliance, elegance, and accessible luxury.

A key highlight is the pie-cut setting technique, designed to create the visual impact of a solitaire while enhancing affordability without compromising on craftsmanship. The collection includes rings, pendants, earrings, and statement pieces crafted in fine gold, celebrating warmth, sophistication, and enduring commitment.

Limelight Lab Grown Diamonds

This Valentine’s Day, romance is taking a more meaningful turn, with couples choosing symbolic jewellery over grand gestures. Reflecting this shift, Limelight Lab Grown Diamonds has introduced its Valentine’s Day Collection alongside a compelling value proposition—offering 26% off on diamond value plus an additional 26% off on making charges, making thoughtful diamond gifting more accessible.

Highlights from the collection include the Stellar Heart Diamond Ring with its refined, contemporary silhouette; the Heartbeat Round Diamond Chain inspired by the rhythm of love; and the Toi et Moi Heartfelt Glow Diamond Stud Earrings, celebrating togetherness through a dual-heart design with subtle sparkle.

Joy Alukkas

Joyalukkas marks the season with romantic diamond and gold creations that blend tradition with contemporary styling. From elegant solitaires to heart-inspired pendants and couple bands, the brand focuses on versatile designs that celebrate affection with timeless appeal.

Giva

GIVA embraces youthful romance with minimalist silver and gold-plated jewellery accented by sparkling stones and heart motifs. Designed for everyday gifting, its Valentine’s range reflects accessible luxury tailored to a new generation of expressive consumers.

Divine Solitaires

This Valentine’s Day, Divine Solitaires celebrates meaningful love through its signature 8Hearts 8Arrows diamonds—where perfect symmetry and brilliance mirror the harmony of a couple’s bond.

Visible under specialised light, the rare 8Hearts 8Arrows pattern is a mark of exceptional craftsmanship and precision cutting, offering new-age couples a powerful and enduring symbol of pure, natural love.

Akoirah

This Valentine’s season, Akoirah by Augmont presents Made of Us, a design-led collection rooted in the belief that love isn’t one-size-fits-all -it is personal, layered, and quietly meaningful.

From emerald-toned lariats and wrap rings to halo studs and heart-set tennis bracelets, the collection blends intimacy with refined craftsmanship, including personalised Morse code necklaces.

Crafted in 14K recycled gold and set with lab-grown diamonds, the collection reflects Akoirah’s belief that meaningful jewellery is shaped not just by materials, but by stories and shared moments.

Lukson

Lukson introduces Love-Lore, a thoughtfully curated Valentine’s collection celebrating modern, intentional love. Crafted in luminous 18K gold vermeil with solid gold options, and adorned with SGL-certified lab-grown diamonds, the collection blends clean lines, heart motifs, and infinity-inspired silhouettes to create elegant pieces designed for everyday wear.

From delicate pendants and expressive rings to refined couple bands and bracelets, Love-Lore captures shared beginnings and lasting promises. With prices starting at ₹4,249, the collection reflects Lukson’s commitment to accessible, transparent, and sustainable luxury—offering jewellery that is both meaningful and responsibly crafted.

Jos Alukkas

Jos Alukkas presents jewellery designed to celebrate commitment and cherished moments. From classic contemporary heart-inspired pieces, to continue the brand’s offerings focus on craftsmanship and timeless romance.

How International Jewellery Houses Celebrated Love this season

For Valentine’s Day 2026, leading global jewellery brands spotlighted iconic motifs, coloured gemstones, and elevated everyday luxury, blending heritage with contemporary romance.

Platinum Guild International (PGI)

PGI promoted platinum love bands and minimalist couple jewellery, highlighting purity, rarity, and enduring commitment. Campaigns focused on modern partnerships, self-expression, and platinum’s natural white sheen as a symbol of lasting love.

Swarovski

Swarovski embraced playful romance through its heart-shaped crystal jewellery and vibrant statement pieces, spotlighting bold colours and contemporary silhouettes. The brand leaned into gifting narratives, amplifying sparkle with accessible luxury.

Chopard

Chopard highlighted its signature collections, celebrating the golden love. The maison reinforced themes of joy, femininity, and timeless elegance, paired with ethical gold craftsmanship.

Bvlgari

Bvlgari showcased its iconic collections, positioning love as bold and powerful. With striking designs, the brand celebrated passion, strength, and modern romance.Harry Winston
Harry Winston focused on its exceptional high jewellery creations, celebrating rare diamonds and timeless romance. The house underscored themes of eternal love, brilliance, and red-carpet glamour

Harry Winston

Harry Winston focused on its exceptional high jewellery creations, celebrating rare diamonds and timeless romance. The house underscored themes of eternal love, brilliance, and red-carpet glamour.

As Valentine’s Day 2026 unfolds, one thing is clear: modern love is thoughtful, expressive, and rooted in authenticity. Jewellery brands are responding with creations that go beyond aesthetics—offering pieces that symbolize shared journeys, personal values, and lasting devotion. Because today, the most meaningful gifts aren’t just beautiful—they tell a story worth keeping forever.