We Need More Partners to Share our Vision: Alex Popov

The World Diamond Mark Foundation is a non-profit organization incorporated in Hong Kong, established in 2012 by the World Federation of Diamond Bourses to promote consumer desirability and confidence in diamonds. Its Chairman Mr. Alex Popov here talks about the challenges ahead and objectives of the organization in an Exclusive interview with G2J. Here are the excerpts:

G2J.: What are the challenges faced by the global diamond industry and how far are they likely to affect your performance as the Chairman of the WDMF?

And one of the prime issues faced by the global diamond industry is supply crunch. Production of rough is lesser than the demand. De Beers in its report has said that growth is expected to be lesser than the demand, unless new diamond resources (mines) are found. Under this situation, why do we need to have generic promotion of diamonds?

A.P.: Let me start with the second question. Diamonds are a natural product – and there are just so many diamonds to come to the market. We know that in the next decade, there will be less diamonds to go around. We’re looking at a declining production of diamonds as no new significant mines are coming on stream, while consumer demand will continue to grow.

Does this mean that diamonds will do well, i.e. prices will go up and that sales will increase? Looking at the current market, we know that is not necessarily so. Yes, in China, India and in Asia in general. Growth will continue. But in these markets, too, competition with other luxury products is fierce. In the west, the current consumers’ generation interest in jewellery has been waning. In the market for luxury products, which is now made up of the so-called millennials, the demand for diamonds and diamond jewellery is significantly lower, as diamond jewellery is competing with an unprecedented number of luxury products and brands. In short, we’re looking at a very mixed bag of expectations.

The Word Diamond Mark’s promotional and educational programmes are all about raising and improving consumer awareness of diamonds and diamond jewellery as a generic luxury product, in parallel fashion to the promotional and advertising campaigns of diamond and luxury jewellery brands.

Our task is to revive and strengthen the generic promotion of diamonds, and we have chosen to begin that effort in the retail jewellery market. All our programmes evolve about creating recurring anchor events, long-term, international and national multi-layered marketing campaigns that will help retail jewellers not only grow and improve their performance, but also will enhance the reputation of the product and the diamond and jewellery industry at large.

G2J: Do you consider synthetic diamonds (disclosed of course) as potential threat to the growth of natural diamonds?

A.P.: Not at all. They fill a demand. Synthetic diamonds are a cheaper solution, as they are created – synthesized – in a laboratory, and not mined. I’d like to repeat an excellent argument that Harry Levy, president of the London Diamond Bourse, Chairman of the International Diamond Council (IDC) and president of the Gemological Association of Great Britain (Gem-A), offered in an interview: He said:

“I think that we do not need to try and re-invent the wheel. Let’s look at how the colored gemstone trade has dealt – and deals – with synthetic gemstones and take a page out of their book. The colored gemstone industry has been coping with synthetic counterparts of their most important stones for a very long time, mostly because they are – contrary to synthetic diamonds – relatively easy to produce. A variety of synthetic rubies, sapphires, emeralds, and a large group of other synthetic gemstones, have been around for more than a century, and continue to be produced. Have these products killed the colored gemstone industry? Not really. Are they a problem? Sometimes. How do our colleagues in the colored gemstone business deal with them? They cope with it by getting educated and by insisting, by means of strict rules and regulations, that synthetic colored gemstones are disclosed properly and honestly when traded and sold.”

Harry Levy hit the nail right on the head. Don’t try and fight synthetic diamonds, make sure you regulate them, make sure the consumer knows what they are, and make sure that the message of the natural diamond is advanced and promoted. In other words, join the efforts of the WDMF.

G2J: What do you expect to achieve from the World Diamond Conference being held in New Delhi, India in December 2014?

A.P.: It is another great opportunity to gain visibility and to generate wider recognition of our goals and objectives. It takes a long time to create brand awareness, and in our cease reality is no different. However, at the conference we will do something really special – we’re going to let the diamond marketers talk directly with representatives of the luxury brands. That should make for inspiring and valuable exchanges! At the conference in New Delhi, India, the speakers, panelists and participants also will address the issue of marketing diamond and diamond jewellery. They all share the WDMF’s objectives, even if they are not yet aware of it.

All speakers, panelists and participants will be discussing, each from his or her perspective, the sustenance of our industry. Miners will speak about production but also about their growing awareness that without a flourishing end-market, their product will meet less demand. Manufacturers and operators in the downstream market will shed light on the disjoint between rough and polished diamond prices while their clients – the jewellery manufacturers, wholesalers and retail jewelers will talk about the enormous competition for the consumers’ discretional income in the luxury product consumer market. Together, they will need to agree on what message we are sending to the consumers and how to work together to make our business more profitable, sustainable and successful!

G2J: How challenging is your job? How confident are you to fulfill your responsibility?

A.P.: Do not get me started. It takes a lot of my time – and it is a very challenging job. Of course, it is a lot of team work – and we have a great team. Of course, we have come a long way already. The WFDB has been the initiator and the owner of the concept since the beginning. The concept was first discussed at the 34th World Diamond Congress in Moscow in 2010. There the ad hoc working group was formed. Later on, at the Presidents’ Meeting in Dubai in 2011, the WFDB officially formed a WDM Committee that included Messrs. Hathiramani, Baron and myself. This committee has developed the programme up to the point where it is today and has established the legal framework for its implementation. Shortly after the 36th World Diamond Congress in Mumbai, we were already incorporated and continued working.

Six WFDB ExCo members are members of the WDM Board, including WFDB President Ernest Blom, who is my Vice-Chairman. The WDM Committee was strengthened by Anoop Mehta, President of Bharat Diamond Bourse; Julien Drybooms, President of Vrije Diamanthandel of Antwerp, and others. To put the long story short – WFDB is the father and the mother of the WDM program. Of course, we are open to all industry bodies to join and support the initiative.

Meanwhile, we continue to build the foundations – partnerships, the financial structure, etc. We have, but need more, partners that share our vision, and are ready to put their money where their mouth is. Fortunately, we have found and continue to find those. The GJEPC is an early adopter and the conference is the proof in the pudding. Another partner is the Turkish Jewelry Exporters Association. Many of you will be reading just prior, during or just after the World Diamond Conference in India, the second editon of the World Diamond Magazine. This magazine is published jointly by the Turkish Jewelry Exporters Association (JTR) and the WDMF. It is the result of an exciting cooperation between the two bodies, and testament to the JTR’s and the WDMF’s shared vision that marketing, promotion, retailer and consumer education must be at the top of the agenda of the diamond and diamond jewellery industry and trade. And of course, the magazine is carried by a distinguished forum of international writers, like you.

It is therefore that we first wish to congratulate the Gems & Jewellery Export Promotion Council of India, the speakers, sponsors and participants for making this event happen.

G2J: What goals have you set as Chairman of the WDFM? Have you set any time-frame to achieve them? What has been your progress so far?

A.P.: The World Diamond Mark is active in more than 30 countries through local diamond bourses and professional organizations. It is the leading producer of events, promotion and media content to drive consumer demand for natural diamonds and diamond jewellery worldwide. Our mission is to ensure the health and future growth of the diamond and diamond jewellery industry in the luxury market sector.

The WDMF will identify Authorized Diamond Dealers to increase reputation, brand value and revenue. We would also impart Trade Education to increase knowledge and performance, do Consumer Promotion to increase demand for diamond and diamond jewellery and Consumer Education to increase consumer desirability and trust in diamonds with the emphasis on natural diamonds.

These are some of the prime goals identified by the WDMF. The World Diamond Mark is the end of something; it’s the beginning of everything.

Interview by Suresh Chotai