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How is my diamond investment affected by changing luxury consumption?

  • How is luxury consumption evolving?
  • By what is the luxury market affected?
  • What does that mean for my diamond investment?

The rise of online shopping and the influence of millennials on today’s diamond market is undeniable. Consumerism is evolving spectacularly throughout the market, particularly for luxury goods. Which behaviours have the biggest impact? What does this evolution mean for my diamond investment?

How is luxury consumption evolving?

The biggest influence on the market in general has been the introduction of tech-savvy millennials. Not only has their online shopping behaviour link Why buy diamonds online in today’s market (Week 23) changed the nature of modern consumption, so have their different values. Traditionally, luxurious purchases were equated to a wealthy and luxurious lifestyle. Quality and scarcity were all the rage and being able to show off exclusive and expensive products was reason enough to make the purchase. Millennials, however, value experience and personality above all else, while also strongly taking into account the future.

These values translate into a shifting emphasis on the luxury market, from larger than life statement pieces, such as highly exclusive sportscars, to highly sustainable and emotionally valuable pieces, such as diamonds.

By what is the luxury market affected?

Diamonds are the perfect market for millennial consumers worldwide. De Beers’ luxury report published in June of 2018 showed luxury markets in developed economies rapidly transforming from conspicuous consumption, as with the sports car, to discerning consumption. The report refers to new generations of luxury consumers opting for higher quality and displaying increasing appreciation for craftsmanship. Millennials might have less money to spend than previous generations, they tend to spend it more wisely and invest more often. Quality is key. Although emerging markets still often prefer more conspicuous luxury goods, it is patent that they increasingly mimic Western consumer behaviour.

It is already noticeable that developing markets such as Asia are quickly adapting to the Western turnaround and are also starting to choose luxury goods more carefully.

What does that mean for my diamond investment?

Diamonds are one of the most important winners in the evolution of luxury consumption. They are inconspicuous but hold great intrinsic and emotional value. Moreover, they are evidence of great craftsmanship and allow owners to both show off and be discrete about their purchase. These benefits will prove more and more valuable to your diamond investment, and indeed to diamond investments around the world. As the luxury market continues to evolve, more and more millennial consumers will discover the wide variety of benefits diamonds hold towards their personal values and lifestyles, which will ultimately result in steady growth. 

How do I go about choosing a diamond investment? How can I be sure to pick a diamond suited for my portfolio? Contact the diamond experts at BAUNAT DIAMONDS for more insights into the market.

Author: Inge De Wee
Source: BAUNAT

With this article, BAUNAT strives to inform you thoroughly about investing in diamonds. No investment can be guaranteed to be without risk or fully according to your expectations. That is why we recommend to research the risks and aspects of investing in diamond properly to ensure that you make the right choice for your portfolio.

START TO INVEST See our selection of loose diamonds

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