Laboratory-Grown Diamond: The Importance of Developing Value System Through Brand Building

Diamond is known as the "King of Gemstones" and has a huge consumer market in the world. For decades, people have been working on synthetic alternatives for diamond, first zircon, then moissanite, and now laboratory-grown diamond. However, both zircon and moissanite have become cheaper as the industrial production has become more efficient. Zircon has become a common material for fashion jewelry and other low-cost accessories, and the prices of moissanite have plummeted in recent years as well. The industry has been locked in cut-price competition. In recent years, laboratory-grown diamond (also known as synthetic diamond, CVD diamond, HPHT diamond, artificial diamond, etc.) has entered the market on a relatively large scale and has had an unprecedented impact on the global diamond market. However, consumers and jewelers are concerned about whether the price of the laboratory-grown diamond will also continue to decrease as the production efficiency improves, eventually becoming a cheap substitute as moissanite does. This concern largely affects their purchasing and operating decisions. At present, the development of diamond breeding is at a fork in the road. The price of rough laboratory-grown diamond from the manufacture has gradually dropped in recent years, but its price in the consumer market has split into two levels. By studying the development path of moissanite in the consumer market, this paper analyzed the value system of natural diamond in the consumer market and pointed out the value shortage of moissanite. This study concluded that in order to form a sustainable and stable price and growing margin, the value shaping of the laboratory-grown diamond must be strengthened through the form of brand building, especially the emotional value shaping. Non-brand laboratory-grown diamond retailers will only be caught in a constant price war competing for paltry profits in a Red Sea due to the decreasing production costs. Only when practitioners focus on the right competitive point and persevere, can they get rid of the price war dilemma and obtain the long-term excess returns. Thus the whole laboratory-grown diamond industry chain can have a better future.