The Diamond Is Forever By De Beers Diamonds

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“A Diamond is forever.” Or is it really? For about 80 years, the De Beers diamond company has pulled off one of the best marketing schemes a company could wish for. Indeed, how much would you estimate your diamond engagement ring wrapped around your finger? A fair amount would be the right thing to say. However, the compressed carbon stone is worth less than anyone would imagine, which is why De Beers has been so successful, which, thanks to a good use of marketing as well as strategy, has led the entire planet to believe that diamonds are rare, luxurious and expensive stones. They are the leader in their field, as De Beers’ diamond output from their own activities is about 40% of the world’s total rough diamonds. The key to their success…show more content…
PESTEL Analysis 1) Political/Legal Firstly, from a political point of view, the diamond industry has several points that can be judged to be slightly controversial, such as the fact that mining diamonds in West Africa or Angola were used to finance the ongoing civil wars and conflicts that occurred in the late 20th century, thus being called “blood diamonds”. This was problematic for the companies operating in these countries as they were accused of selling these diamonds to the rebels who were fighting legitimate governments. Furthermore, due to the United States antitrust laws on cartelization, De Beers faced many accusations on issues such as collusion and price fixing, and was banned since 1948 from operating on US soil. This is problematic as the USA is the planet’s predominant market for diamonds, accounting for 45% of the world’s diamond jewelry sales, and therefore has to find loopholes in the legislation to be able to profit from the USA’s market. De Beers therefore leads its main selling operations called “sights” in Botswana, which will be discussed later. 2) Economical On the economical scale of the industry, emerging markets are the key to the industry’s potential profits, with a raise in middle/upper middle classes in countries such as India or China. This can be beneficial to De Beers and other mining companies in the short term; however, supply is expected to be inferior to demand after 2020, which will incur a rise in

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