The Branding Fire
Diamantaires circle the wagons to protect their territory
Presidents of the World Federation of Diamond Bourses expressed
continuing reservations about De Beers' actions in the branding
arena during their meeting in July in Moscow.
Some dealers view the branding experiments De Beers has conducted
in a few cities in England as incursions into sacred territory.
De Beers' promotion of polished diamonds at the World Watch,
Clock and Jewellery Show this spring in Basel, Switzerland, seemed
to confirm dealers' fears. It marked the first time the cartel
actively promoted its polished diamonds through distribution
of brochures at a trade event. While De Beers' polished diamond
division has been active for several decades, its purpose at
Basel was merely to sell limited quantities of polished goods
and to gauge market fluctuations and determine pricing policies,
the company said.
De Beers officials said sales of polished diamonds are necessary
to keep the division solvent. WFDB members see these sales as
De Beers trying to bypass them and cozy up to retailers with
branded polished diamonds. WFDB and members of the International
Diamond Manufacturers Association demanded and got
Gary Ralfe, De Beers' managing director, to listen to their concerns.
Eli Haas, a WFDB vice president and president of the Diamond
Dealers Club of New York City, said he had "private and
frank" discussions with Ralfe. He asked if Ralfe understood
branding would harm other industry segments. "His answer
to me was clear: De Beers' strategic planning is driven primarily
by the concerns of its shareholders," said Haas.
De Beers officials have always acknowledged the company's
need to stay viable and strong in a changing diamond market.
by Robert Weldon, G.G.
Copyright © 1999 by Bond Communications.