Off-the-shelf offerings no longer satisfy millennials, who largely focus on getting value for money
While some experts argue that millennials are buying less diamonds than previous generations, the founder of Dubai-based online diamond platform FergusJames.com believes they are simply shrewder with their purchases.
Speaking to Arabian Business, Fergus James said millennials focus on getting value for their money, with regular “off-the-shelf” offerings no longer satisfying them.
“My main observation is that millennials are increasingly sophisticated in the way they research and make their purchases. It’s not necessarily that they don’t want to buy. You just need to work harder to convince them,” he said, adding that they make up 60% of the website’s customer base, with the percentage continuously increasing.
FergusJames.com, previously known as Dubai Rocks, particularly appeals to the male shopping psyche by easing the process of buying engagement and wedding rings through swift online guidance, unique customisation options and 70% cost savings on GIA certified diamonds.
Having secured AED 1.5 million in August, the start-up is expanding across the region to Saudi Arabia over the next 12 to 24 months, with operations in the UK and US already up and running.
According to James, the platform has seen millennials change the buying dynamic within the regional market due to their smart buying habits, James said, explaining that they demand high quality service as much as they do high value.
Karim Merchant, Group CEO & Managing Director of Pure Gold Jewellers, said the younger generation also perceives diamonds as accessories rather than investments.
“Growth in disposable income among the millennials has led to a surge in demand for unique, trendy, responsibly sourced and mined diamonds. Millennials do not perceive diamonds as an investment but as a fashion statement - just like celebrities who buy diamonds for the most important occasions,” he said.
The UAE is among the world’s top 5 importers of diamonds after the US, India, Hong Kong and Belgium, with its imports making up 7.1% of the global total, at a value of $8.4 billion. In 2017, Dubai was ranked the third-largest diamond trading centre in the world after Belgium and India.
While its imported diamond purchases declined 42 percent from 2013 to 2017, the industry is picking up momentum in the UAE. Earlier this month, Emirati Swiss luxury firm Mouawad acquired a 51.38 carat Dynasty diamond. Mouawad is known for breaking Guinness World records with bejewelled designs, such as the 1001 Nights Diamond Purse, a heart-shaped bag featuring 4,517 diamonds and valued at $3.8 million.
Malabar Gold and Diamonds is also opening five new showrooms in the UAE, and expects its annual sales to increase 10 percent to $5 billion in 2018.
Furthermore, Dubai-based diamond trading company Nemesis International announced the opening of a new diamond polishing factory last year. It expects to turn over about 150 carats of diamonds per month and up to 3,000 carats within the first two years. In 2016, Nemesis also bought an 813-carat diamond (The Constellation) for a record $63 million, or about $77,500 a carat.
Diamonds are largely popular in the GCC region, particularly in Dubai, where luxury watch and car houses often create bespoke jewel-encrusted collections to cater to clientele from the Middle East.
This year, Louis Moinet created a watch inspired by the late Sheikh Zayed, in line with the Year of Zayed. It features almost 100 baguette-cut diamonds and was purchased for $2 million by an Omani royal. In the same year, Dubai also saw a $1 million diamond-encrusted cake showcased at the annual bridal event Bride, while UAE fashion brand Jada Dubai created $272,245 (AED 1 million) shoes boasting 54 carat white diamonds and other precious stones.