martin rapaport

Reporting From the Rapaport Conference: What Consumers Need to Know About Gem Labs

Filed under: Jewelry

When you buy a diamond you get hit with a lot of letters and numbers. VS, SI, F color, etc. But who determines what number goes with what diamond? With diamonds the grading for color and clarity is a major determinant in price. Unfortunately it's also a way that the unscrupulous can capitalize on the unsuspecting. Have you ever seen an ad where the jeweler promises that the stone will appraise for more than the sale price? How can that be? In some cases, jewelers use labs that are cheaper and/or have more open standards. This issues was discussed by a group of diamond jewelers, merchants and other concerned people at the Rapaport Conference on Diamond Certification on June 6 at the JCK Las Vegas show.

One stone can get two different grades from two different labs. There is no absolute standard for diamond grading, it always comes down to the decision of the grader. The Gemological Institute of America created and determined the standard in the 1950s but any lab can grade stones using the same nomenclature and consumers may not be aware that there is any difference between the standards of grading labs. The GIA naming standards are not patented and can be used by any lab and have created a common language through which to discuss diamond quality. But it may be misleading to the consumer if labs which do not use the GIA grading standards use the GIA nomenclature.

This has led to a situation where there are price differentials in certificates. Is the same diamond worth more with a certification for a different lab? Some labs have a reputation for being more lenient. This is something that jewelers and diamond buyers know but not something that is clear to the consumer. The GIA charges more for certification and is known to be stricter.

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Reporting From The Rapaport Conference: What Is The Future of Diamonds?

by Deidre Woollard (RSS feed) —

There are certain people in this world that others just listen to and trust, whether they like what they hear or not. For the stock market, there is Warren Buffett. For the world of diamonds, there's Martin Rapaport, the owner of Rapaport diamonds, publisher of an infamous price list and the irascible and brilliant voice of the state of the industry. Which is why I trekked across the desert this weekend to hear Rapaport opine on the future of the glittering stones at the JCK Show, the annual jewelry fair in Las Vegas.

This was my first time at the show since 2008 and the overall mood seemed if not jubilant, at least a bit less full-scale apocalyptic. The cautious optimism that I saw expressed by luxury executives at last month's Luxury Summit was in play at the Las Vegas jewelry shows as well. There was also a little air of pride in having weathered the economic storm and being able to still be in the game. And they are looking for opportunity, for ways to leap into the (hopefully) coming upturn. But, as Rapaport made abundantly clear, it's far from smooth sailing for jewelers, miners and others associated with the diamond industry going forward.

Tags: diamonds, martin rapaport

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Martin Rapaport On The Future of Diamonds

by Deidre Woollard (RSS feed) —

Filed under: Jewelry

You've likely never heard of Martin Rapaport but to the diamond world he's famous. Rapaport is to diamonds what Robert Parker is to wine, a person of tremendous influence. He runs Diamonds.Net and his Rapaport Index defines diamond pricing for the world. On Monday, Rapaport spoke to the packed room at the JCK jewelry show in Las Vegas delivering his pronouncements on the diamond market at an annual breakfast event. Right now, the diamond industry is facing similar challenges seen by the rest of the luxury market. Rapaport feels that the current economic climate offers both opportunity and pitfalls for those in the diamond business.

The news is conflicting, larger stones have been getting higher and higher prices and the huge wealth in China, Dubai, India and Russia is creating a hunger for luxury goods and diamonds and diamond jewelry specifically. This is also a time when the plummeting real estate market in the U.S. and Europe means that the Western world, which fueled the global prosperity in the beginning, is now cutting back on spending. Independent stores and small chains are having a tough time and the news is full of stories of stores having bankruptcy sales where goods are being sold off at below cost.

As of 2007, the U.S. still made up the bulk of diamond jewelry sales, clocking in at 43%. China brought in 8.5%, Europe did 11% and the Middle East was responsible for 4.6%. Until recently, the U.S. had been on a path of prolonged economic growth and our prosperity fueled the global economy expanding the middle class in India and Africa. Small jewelers in the U.S. are now competing with a global market. As I've heard mentioned at other conferences such as the Luxury Summit, the number of millionaires and billionaires is growing worldwide. This might be one reason why the price of big stones is going up far faster than the prices for smaller stones, especially those under a carat.

For jewelry sellers, as I heard in other sessions at this show, branding is more important than ever, especially to new luxury spending markets. Rapaport cautioned though that branding is a "trojan horse" for the retailers. First the retailers convince their customers which brand to buy and then the seller of the brand raises that price. Many stores are worried about the new DeBeers Forevermark, a branded diamond sold by DeBeers. Now the considerable advertising budget of DeBeers will be aimed at marketing that diamond which will be sold at premium price. Rapaport's answer to those competing against this new stone? Hang a sign in your window advertising that you are selling for diamonds for 10% less than Forevermark.

Tags: diamonds, jewelry, martin rapaport, MartinRapaport

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