Lab-Grown Diamonds Are Being Embraced As Affordable Luxury Options - Don Key: Wholesale Diamond Supply

Lab-Grown Diamonds Are Being Embraced As Affordable Luxury Options

By Melissa Daniels

Both bridal and fine jewelry brands in the lab-grown space report sales increase in recent years. In 2022, DTC jewelry brand Ring Concierge saw lab-grown engagement ring sales increase 3.3 times year-over-year. In the opening price point range of $10,000 to $15,000, the brand saw more than 2.5 times growth from 2020 through 2022.

Experts in the space say customers are drawn to the lower price point of lab-grown diamonds, which allow them to get a bigger, shinier piece of jewelry for a fraction of the cost. A three-carat mined diamond ring, for example, might be $30,000 but $14,000 using lab-grown. And, as more jewelry brands release their own lab-grown lines, some customers’ concerns about the pieces not being “real” diamonds have dissipated.

“Mined diamond prices have been increasing, and lab grown diamond prices have been decreasing because the supply is exploding,” said Ring Concierge CEO Nicole Wegman. “It’s making it more and more appetizing to the customer to say ‘Okay, well I can get a three-carat for a fraction of the price if it’s lab grown. Whereas I don’t even know if I could afford a two-carat if I am buying a mined diamond.’”

Allied Market Research projects the lab-grown diamond market will hit nearly $50 billion by 2030 with a CAGR of 9.4%, up from about $19 billion in 2020. And while that’s a small portion of the overall jewelry industry, some signs indicate the segment is growing: consultancy firm Tenoris found in October 2022 thatlab-grown diamonds made up 10% of engagement ring sales, up from 6% the year prior.

From an industry perspective, though, the trajectory is mixed. Some brands are quick to embrace the trend. LVMH’s venture fund last summer invested $90 million in lab-grown diamond producer Lusix, while fashion jewelry brand Pandora launched a lab-grown line in August following an announcement it would no longer used mined diamonds.

Somelongtime jewelers, including industry expert, Martin Rapaport have called out lab-grown stones for not being “real diamonds” — though the Federal Trade Commission definition of “diamond” is based on scientific qualities that aren’t differentiated by mined or cultivated.

Wegman from Ring Concierge said there’s room for both types of stones in today’s market, and her company makes it a point to play in both arenas. The brand launched in 2013 as a custom designer of engagement rings. And to this day, most customers in that category are still seeking mined stones. But demand for lab-grown has steadily risen over the year, and Ring Concierge launched a ready-to-ship lab grown engagement ring line in December.

“That’s why we have such a big customer base and such a big range in price points in terms of what we offer, because we really want as many people as possible to be able to afford it and to wear it and to enjoy it,” Wegman said.

Improved supply

Jean Dousset, great-great grandson of Louis Cartier, in February launched a new ready-to-shop lab-grown diamond collection for his eponymous jewelry line. The launch comes about a year after the brand first started selling lab-grown pieces, which now make up about 75% of its overall sales.

Dousset told Modern Retail the designs followed improvements in the technology used to create lab-grown diamonds and gemstones. 

“We had historically little interest in lab diamonds because of the quality available to us—there was a lot to be desired in cut, clarity, color, and carat,” Dousset said in an email to Modern Retail. “As technology has evolved over the years, lab diamonds are now on an even playing field with their mined counterparts with the same third-party certifications and at a much lower cost to customers.”

Yet the styles aren’t meant to serve the mass market. With prices ranging from $1,200 to $19,800, the new line of tennis bracelets, necklace and earrings is still a luxury-focused product. But the price points are less than what they would be with mined diamonds, Dousset said.

“They allow more people to enjoy well-crafted designer rings and jewelry they couldn’t consider before, as well as higher-quality diamonds,” he said. 

Bride-driven demand

Dousset said that customer surveys show three-quarters of customers want lab-grown diamond jewelry. This demand is specifically seen in the bridal category, where brides are craving more size for their dollar. 

“Three carat is the new one carat,” he said, with stones as big as seven or 10 carats seen in some designs. 

Wegman from Ring Concierge said social media is also playing a role in brides wanting a flashy, large ring. 

“Getting engaged is a very public social moment,” she said. “And so you want to be proud of that ring, which is, I think, further motivating people to either stretch and spend more than they perhaps should, or opt for a lab-grown (stone) to get that carat weight that they’re excited to show off.”

But with that purchase comes a level of awareness and education. Katie Bilodeau, president at Ring Concierge, said the brand’s customer service agents aim to ensure the customer who opts for a lab-grown stone is clear-eyed about the potential for a drop in resale value on the market.

Conversely, a mined diamond may be able to appreciate value years down the line, depending on the market, Bilodeau said.

“You don’t know the value a year from now,” she said.

Increased popularity

Meg Strachan founded Dorsey in 2019 as an exclusively lab-grown gemstone fine jewelry brand that uses lab-grown white sapphires, rubies, and emeralds, among other colored stones. The brand saw 600% year-over-year revenue growth from 2021 to 2022, bolstered by becoming a trendy choice among celebrity influencers – including Hailey and Justin Bieber, who donned a Dorsey necklace during his last tour. 

“When he’s choosing that, it’s a big deal for the lab grown industry, in general, and a big deal for us,” Strachan said. “But overall, it helps an entire industry move forward.”

Dorsey’s Riviere line of necklaces and matching tennis bracelets has sold out multiple times, with waitlists running as high as 30,000 customers. 

Strachan said the majority of customers are in the early 30s to 50s and are often shopping for themselves.

This, too, represents a shift in the industry. 

“Specifically for Riviere necklaces and diamond bracelets, those used to be known as something that was gifted to you for these massive moments in life. And so it’s been interesting for us to see that, outside of a few holidays a year, we really see that our primary customer is buying for herself,” she said.

Correction: This story has been updated to note that Dorsey launched in 2019, not 2021 as initially stated. This story also initially stated that Justin Bieber donned a Dorsey bracelet during his last tour. Rather, he donned a Dorsey necklace. 

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