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De Beers: Diamonds Can Capture Unspent Travel Dollars August 19, 2020 (0 comments)
London, UK—Consumers who have canceled travel plans and cut back on dining and other experiences due to restrictions during the coronavirus pandemic are ripe to buy diamonds. That’s the conclusion of the latest De Beers Group Diamond Insight Flash Report, released Wednesday. The series looks at the consumer perspective in the United States and how it continues to evolve as the country progresses through the stages of the Covid-19 pandemic.
The latest report includes a focus on consumer discretionary spending, including the potential for diamonds to capture luxury market share from travel spending, the key competitor to diamond jewelry in recent years, especially among Millennials.
The latest round of research, conducted among 500 Americans age 18 and above, found that 44% of consumers had more disposable cash due to the cancellation of travel, dining or other experiences during the year. When it came to travel specifically, more than two-thirds of Americans had cancelled travel plans for 2020. Of those, 55% found themselves with extra money as a result and, in the absence of travel, one in eight said they would instead choose diamonds to mark a special occasion.
The report also looks at how consumer confidence has changed since De Beers Group started this research in March. While consumer confidence was relatively fragile overall compared with previous research waves—largely due to the increased spread of the virus and uncertainty regarding the upcoming presidential election—the latest research found that almost half (46%) of consumers had an optimistic outlook on life overall for the next three months and more than 60% said the pandemic had not affected their personal finances. In addition, 46% said their jewelry spending was back to normal, with a further 25% expecting it would normalize in the next six months.
Chart: De Beers Diamond Insight Flash Report 3
De Beers Group CEO Bruce Cleaver said, “As a product that can be both experiential and meaningful, diamonds fill the temporary void left by travel in the way few other luxury products can. Diamond marketing themes that highlight these attributes are likely to be particularly well received by consumers who have additional money to spend due to their lack of spend on travel, and are looking to create a special gifting experience this holiday.”