- Forevermark currently has a 20 per cent market share in the price segment it operates in. This price segment accounts for 35 per cent of the total diamond market in India and it is this market that we shall now target and look to cater for.
- We will continue to invest significantly in the brand to support its fast growth. Throughout 2017 and into the beginning of 2018, we will be further expanding our licensee model in Western Europe and Asia, meaning that the Forevermark promise of beautiful, rare and responsibly sourced diamonds will reach even more consumers around the world.
Stephen Lussier, one of the most dynamic and celebrated leaders of the global diamond industry, has contributed vastly in elevating the industry to its present-day level. The CEO of Forevermark and Chairman of Diamond Producers’ Association (DPA), Mr. Lussier throws on various issues of the industry in an exclusive interview with G2J. The excerpts:
How was 2016 as far as Forevermark’s India performance is concerned? Any adverse effect of demonetization and jewellers’ strike?
Stephen Lussier: Despite all the changes taking place in the Indian environment recently, Forevermark has been performing very well in the country, which reflects our strong global performance.
Earlier this year we inscribed our two millionth diamond at the Forevermark institute in Surat, as well as the opened our 2,000th global retail door, which comes almost eight years after launching the Forevermark brand. In 2016, the number of retail doors rose 14 percent, with Hungary, South Korea and Thailand joining the list of countries where the brand is present. We will continue to invest significantly in the brand to support its fast growth. Throughout 2017 and into the beginning of 2018, we will be further expanding our licensee model in Western Europe and Asia, meaning that the Forevermark promise of beautiful, rare and responsibly sourced diamonds will reach even more consumers around the world.
In India, Forevermark has been available at the retail level through a shop-in- shop model. In 2017, India is poised to surpass the US to become the second largest market for Forevermark globally, as we expect to more than double our volumes in the country. Asia Pacific, Forevermark’s largest market, accounts for 50 per cent of volume, with the US and India each accounting for 15 per cent. This year, however, India’s contribution to our global volume will increase to 20-25 per cent. Today Forevermark is available in 200 retail outlets in India, having launched in the Indian market in 2011.
India has witnessed some challenging times with strikes, demonetization, GST and digital disruption, however it is our belief at Forevermark that if you have clarity about the future you can do anything.
How do you see the growth rate of Forevermark in 2017 in India?
Stephen Lussier: India remains a key growth market for Forevermark. Last year, our volumes in India stood at 60,000 pieces. In terms of Indian consumer demand for diamonds, the Indian market has overcome the impacts of demonetisation and is posting a return growth so far this year. This is being driven by positive macro-economic developments, success of government policies and reforms giving consumers greater confidence.
Achieving success is all about maximising current performance. This involves a focus on things such as the in-store experience, increased inventory efficiency, better supplier relationships, enhanced customer service, a better online presence etc. Businesses need to look at undertaking continuous improvement across all aspects of their activity to achieve optimum performance in the here and now.
Forevermark currently has a 20 per cent market share in the price segment it operates in. This price segment accounts for 35 per cent of the total diamond market in India and it is this market that we shall now target and look to cater for. India has witnessed some challenging times with strikes, demonetization, GST and digital disruption, however it is our belief at Forevermark that if you have a strong and clear consumer proposition and are aligned with your retail partners. You can shape your own future.
India is a huge consumer market. But still many of the consumers in II tier and III tier cities here are not aware of ‘Forevermark’ brand, how do you plan to cover these areas?
Stephen Lussier: The Forevermark promise is that our diamonds are beautiful, rare and responsibly sourced. The beauty of our diamonds is enhanced by the designs of Forevermark collections, which we create based on cultural traditions in various markets. The Capricci, nose pin collection is one such example which is created especially for the Indian market. We launched the collection last year and owing to its success, we launched the color therapy and season’s range this year.
India is a developing country, and expanding into the tier 2 and tier 3 cities by associating with retail partners is a natural extension for us. Over the past few years Forevermark has partnered with prominent fashion designers including Tarun Tahiliani, Rohit Bal, Manish Malhotra, Bibhu Mohapatra and recently with Sabyasachi Mukherjee to launch exquisite lines of couture jewellery. We constantly strive to innovate and create various designs to cater to our consumers. We also work with our partners to create exclusive collections available at select stores.
Forevermark in now present in 38 markets all over India and our response in the Tier II and Tier III markets has been surprisingly strong. Most of these markets, our partners are the leaders, our collaborations are completely focused on building demand with the new age consumers who we believe are very similar in their understanding of brands. Some of our strong smaller markets include Kanpur, Bhubneshwar, Baroda, Trivandrum, Jamshedpur and others.
Some Indian leaders opine that the diamond industry has reached the saturation level, from where it will grow but with a negligible growth rate. Do you agree with it or not?
Stephen Lussier: I don’t agree at all. India, U.S and China are the three major diamond consuming countries across the globe and in India and China in particular we expect continued expansion of the affluent classes. I think we can be positive about the growing demand and consumption in India and international markets. India in particular remains a market with great opportunities for diamonds to both benefit from strong economic growth and increasing diamonds still comparatively low share of the overall jewellery market.
Of course, Forevermark, the diamond brand of the De Beers Group, has huge growth opportunities. Each one of our diamonds undergoes a journey of rigorous selection before it is inscribed as a Forevermark diamond. Forevermark’s market stood at 60,000 diamond pieces and was expected to increase to 130,000 pieces by the end of 2017. Consumers and in particular Millennials in India have distinctive preferences, they tend to be more value conscious, more concerned with sustainability and ethical production, and often value unique and individual products versus items that are standardized and mass-produced. Launching in market in 2011, Forevermark now has 200 doors in India in comparison to 800 in China and 400 in the U.S.
Where would be Forevermark in 2020? Please give us your global vision.
Stephen Lussier: Since its inception, Forevermark has experienced phenomenal business growth in the global diamond market. As the brand awareness and offerings increase over the years, we can only expect good outcomes in the future.
As for India, Forevermark’s growth trajectory will be to capture the market share in the generic diamond category following the roll out of the goods and services tax (GST) regime this year. We also plan to increase our presence to 230 doors by the end of 2017 and will come up with three more exclusive outlets in Delhi, Mumbai and Kolkata apart from its exclusive store in Bangalore. Forevermark currently has a 20% market share in this price segment.
Globally the brand is on the upward rise and with the digital age we hope to offer further innovation in product, design and experience to our customers.
As chairman of Diamond Producers’ Association (DPA), how do you plan to bring awareness about diamonds among consumers, especially young generation?
Stephen Lussier: We will start with new advertising campaigns in Q4 2017 focusing on building the deep emotional symbolism that diamonds have with today’s younger Indian couples. To make diamonds synonymous with the aspirations of modern married millennials.
Apart from lack of generic promotion, what other factors do you think could be responsible for drop in diamond demand globally?
Stephen Lussier: We haven’t seen a drop in demand. Demand has remained steady at record levels in what has been a pretty economically volatile environment.
How effective is DPA’s new slogan ‘Real is Rare..’? Is it proving as effective as De Beers’ ‘Diamond is For Ever’?
Stephen Lussier: ‘Real is Rare’ provides an additional way to talk about diamonds that appeals to millennials desire for authentic and precious things. It’s reinforcing of other attributes of diamonds beyond ‘forever’. Together they make a powerful combination.
The generic promotion by DPA would be a continuous process or would it be for a limited period?
Stephen Lussier: This is part of a long-term commitment by the DPA to support diamond demand.
Are diamonds really rare?
Stephen Lussier: Of course they are. All the diamonds ever mined in all human history would fit comfortably inside of a single London double decker bus. They were all created over a billion years ago and Mother Nature is not making any more. They will only get rarer in future.
Interview by Suresh Chotai