Recently, the diamond industry has been transformed by a need for traceability throughout the diamond journey, compelling sellers and retailers to look for ways to reliably communicate the provenance of each diamond to consumers. The buying power and social responsibility of younger customers is driving diamond retailers to find innovative solutions to increase transparency into the diamond supply chain, while enhancing the buying experience for each consumer.
Why Traceability Matters in the Diamond Industry
Millennial and Gen Z buyers drive most of the demand for diamond jewelry, with the former group driving 59% of demand in the US and 79% of demand in China, the two largest diamond markets worldwide. They are well informed about the diamond industry and many are concerned about social issues, requiring details about the history and provenance of their diamonds.
Consumers who want to follow the full diamond journey, from the mine to the store, want retailers to fill in information gaps, answering questions like:
- Where was the diamond mined?
- How was its cut planned?
- What are the diamonds grading parameters?
- How many miles has the diamond traveled?
The two biggest concerns for customers are avoiding buying ‘blood diamonds’ which fund human rights abuses and gaining reassurance that their diamond is authentic. Around 4% of the world’s diamonds are ‘blood diamonds,’ but the total is probably much higher. Existing supply chain regulations aren’t enough to reliably reveal conflict-zone diamonds, driving the need for better traceability technology.
Synthetic lab-grown diamonds share the same properties as natural diamonds and consumers can’t tell the difference with the naked eye. It’s estimated that approximately 7% of all gem-worthy diamonds in the market today are synthetic, and that number could grow to 10-17 million carats by 2030. Buyers rely on the retailer and supplier for disclosure.
The Diamond Journey: What Retailers Need to Know
Consumers’ insistence on traceability and provenance are driving retailers to look for new and better ways to access and share the full history of their gems. However, retailers can also harness these trending concepts to create engaging in-store experiences and boost sales caused by competition from online sales and other luxury products.
Sharing the unique story behind each stone can create a rich storytelling experience that excites consumers and deepens their bond with a diamond. It can be used both in-store and online to connect the customer with the true history of their gem, increasing customer satisfaction and raising consumer experience.
It also can elevate the level of transparency and reliability to a new level, allowing each retailer to build a relationship of trust with their customers. The retailer doesn’t need to worry about selling a diamond with a questionable history or encountering unexpected unethical issues in the provenance of a diamond. When the retailer has full confidence in their supply chain, the customer can have full confidence in the retailer.
Sarine’s strong presence across the supply chain means that it’s placed in a unique position to be able to trace every step of a diamond’s journey. And the company’s innovative, advanced technology behind Sarine’s Diamond Journey™ report allows retailers to share this customized information regarding a diamond’s history with customers no matter where they are and in real-time.
In A Data-Driven Age, Verification Based on Data is Key
Existing traceability solutions are insufficient. The most popular approach uses Blockchain to record declarations by each party in the diamond supply chain because Blockchain records can’t be falsified or tampered with. But Blockchain doesn’t stop someone from recording inaccurate data, intentionally or unintentionally, which is then stored forever, giving a misleading appearance of authenticity.
There’s only one way to provide full transparency into diamond provenance, and that’s through verifiable data that cannot be tampered with. Sarine captures this data independently directly from the manufacturing systems throughout the manufacturing process, reducing opportunities for human falsification, which are then stored securely on the cloud.
Industry Giants Embracing Traceability
Leading diamond companies are embracing traceability technology. In January 2019, Tiffany & Co. began etching each diamond with a laser-cut serial number that links to information about each individual diamond’s provenance and country of origin. In some stores, it will include these details on its in-store display. By next year, Tiffany hopes to include information about where each diamond was cut and polished.
In addition, Lucara mining leverages Sarine’s proprietary technology in a solution called Clara. Clara scans rough diamonds to make an unalterable digital fingerprint, which it tags using Blockchain and uploads to Sarine’s platform. Diamond manufacturers then place orders for individual stones, according to the size, cut, color, and quality of the final polished gems they require. Clara uses proprietary analytics to match each order with individual rough diamonds, reducing the number of intermediaries handling each stone and creating a verifiable record of diamond origin.
The rising purchase power of Millennial and Gen Z buyers is leading the diamond industry to modernize its supply chain transparency. However, with advanced traceability methods, diamond sellers and retailers can add value to the customer purchase experience, prove the provenance and authenticity of their gems, and deliver full answers about the diamond journey. Sarine Diamond Journey™ reports, enables diamond buyers and sellers to follow the progress of their diamond at every point in its journey.