The unique combination of circumstances in which Millennials came to adulthood has created a different set of priorities and benchmarks for success than those of previous generations. Millennials in advanced economies generally enjoyed a protected, even pampered childhood, as the affluence of their parents was at a peak in the late 1990s and early 2000s. Similarly, in emerging economies, their adolescence period was characterised by robust economic growth and optimism for the future.
By contrast, the late 2000s saw severe global recession set in, making consumers reconsider their priorities and change their shopping behaviour.
It was in this context that the Millennial generation formed its needs for:
The Millennial generation has to pursue its goals in a complex, ever-changing world which requires tough choices. In this environment, the support of friendship networks and deeper relationships is vital.
Millennials have the largest networks of friends among all generations (Fig. 27), in part due to their proficiency in using social media and desire to stay connected.
It is not just quantity over quality, however: for Millennials, deeper relationships are cherished as they provide an anchor in a challenging world. Marriage and raising children in a family are as important to Millennials as they are to older generations in the US.25
In China and India, while Millennials are not rushing down the aisle either, they still respect traditions and the institution of marriage (Fig. 28). In India, while the number of arranged marriages is declining slowly,26 it was still as high as 92 per cent of all marriages in 2013. A notable exception was in the mostaffluent social strata, the Elites, who reported only 50 per cent of arranged marriages. In the future, it is likely that an increasing proportion of the wider more affluent population will follow in the footsteps of the Elites and love marriages will continue to grow.
In Japan, about a third (32 per cent) of young people under age 30 and not in education are married. For men this proportion is only 17 per cent, but this delayed romantic maturity is due mainly to lack of financial resources, their reluctance to reduce their disposable income or unwillingness to lose free time27 (Fig. 29).
Most marriages in the main diamond markets occur within the age range of the Millennial generation.
Bridal diamond jewellery – ie diamond engagement rings and diamond wedding bands – still comprise a large proportion of the diamond jewellery acquired by Millennials in the US, China and Japan (Fig. 30), delivering over US$11.5 billion in value, or just under half of the combined US, Chinese and Japanese Millennial diamond jewellery demand in value terms.
It is a slightly different picture in India. Rather than the American, Japanese and Chinese bride’s typical solitaire engagement ring with a sizeable diamond, in India a bride’s jewels mainly consist of large gold pieces with numerous small diamonds. Since the Indian tradition sees most bridal jewellery gifts stemming from the bride and groom’s families, rather than between the newly-weds themselves, the bridal segment in India generates only four per cent of total diamond jewellery demand among Indian women in the highest socio-economic classes A/B.
One of the most striking characteristics of the bridal jewellery category, particularly in the US where the diamond engagement ring tradition is firmly established, is its ability to weather economic recessions better than other diamond jewellery categories. Thus, US Millennial bridal diamond jewellery has maintained growth since the late 1990s, irrespective of economic crises. That has, in part, been thanks to the increasing affluence of newly-weds, as more marriages occur later in life28 when people are better established and have higher incomes (Fig. 31).
The diamond engagement ring remains a cultural imperative in the US: 26 per cent of US Millennial brides claim to have dreamt about their future ring as many as four and a half years before beginning a relationship. And a further 38 per cent start to think about their dream engagement ring after beginning a relationship but before contemplating a wedding.
Research into Chinese women’s mega-trends, values and relationship with diamond jewellery,29 commissioned by De Beers, revealed that the love positioning of diamonds for young women has to be tailored to their specific needs at each life stage. The youngest Millennials (19–24 years old) start by challenging and often rebelling against the “old ways”; at this stage they need the freedom to discover their own paths, so love and diamonds are about fun and excitement. Later (aged 25–29) they become increasingly focused on gaining recognition and respect through their knowledge, achievements, wealth and status. At this stage, diamond jewellery as an expression of love symbolises sharing and personal acceptance. Finally, the oldest Millennials (aged 30–34 years, and most-likely married and with family) desire security, dependability and order in their lives, and diamonds become a symbol of the safe harbour and harmony in the family (Fig. 32).
This variety of Millennial love needs, which are relevant in all markets, present rich opportunities for jewellers to use different types and designs of diamond jewellery, as well as different brand stories, for each Millennial life stage to capture the diamond category’s potential fully.
Millennials in advanced economies, such as the US and Japan, typically no longer strive for wealth and material prosperity as markers of success the way their parents did. Instead, they are driven by a desire for personal achievement and self-expression.
In Japan, Millennial men live in the shadows of their parents, whose level of affluence appears unattainable.
Source: Quotes from respondents in a focus group conducted by Unity Marketing, Unity Marketing Trend Report: Marketing Jewelry to Millennials, 2014
Source: Anita Rani, Presenter on BBC This World, The Japanese men who prefer virtual girlfriends to sex, BBC Magazine, October 2013
Millennials in the emerging markets of India and China, who have come of age in a more dynamic economic environment, generally aspire to greater wealth and traditional status symbols. However, for them too, self-expression and achievement are important life values: the vast majority believe that the best measure of achievement is having an enjoyable job (84 per cent and 90 per cent agreement in India and China, respectively).30
The diamond sector may therefore benefit from tying personal achievement and self-expression to its symbolism more closely. This could be achieved through individualisation of designs, branding and appropriate shopping experiences to fit the occasions and motivations for diamond acquisition.
For Millennials who are not getting engaged or married, diamond jewellery pieces are most frequently bought to celebrate or commemorate a personal milestone, as a treat, or to cheer oneself up at a difficult time. Millennials are more likely to acquire diamonds for these reasons than the older generations. The non-bridal acquisitions that celebrate the individual now outnumber love and relationship celebration in the US, China and Japan (Fig. 33).
As in other luxury categories, brands are important for Millennials. In the US, branded diamond jewellery acquisition among Millennials is higher than among all female consumers (Fig. 34) – a trend that is particularly pronounced among the older Millennials aged 25–34. It is a similar story in China, where a higher proportion of Millennials (33 per cent) buy brands than older consumers (for whom that figure is 29 per cent). In Japan, where brands have traditionally been strong, 61 per cent of diamond jewellery pieces acquired by Millennials are branded, compared with 48 per cent among the over 35s. This stronger desire from Millennials highlights a growing opportunity for the sale of branded diamond jewellery products in these markets.
Digital media is the essential channel through which young people share information and influence each other. In the US, 43 per cent of Milliennials contribute to web forums or user groups, 39 per cent write reviews or rate products they have bought and 38 per cent share links to products and services they like.31
Affluent Millennials have an even stronger affinity to digital media32 with 60 per cent rating products and services on the Internet and uploading content online, and 29 per cent running their own websites or blogs. These levels of digital interaction are much higher than among the older age groups.
When it comes to shopping, Millennials use online methods alongside visiting traditional brick-and-mortar stores. They will often compare prices online, search for product information and look for discount coupons and promotions online (Fig. 35). Omnichannel shopping experiences are now the norm for younger consumers. Retailers who are not equipped for this will lose out among this client base.
Millennials use their personal networks as well as online resources and traditional offline media to research diamond jewellery purchases. In the US, compared with older consumers, Millennials use the Internet considerably more frequently to research quality, designs and brands (Fig. 36).
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Chinese Millennials also use the Internet for research in about a quarter of acquisitions, but traditional channels play a much more important role in the preparation for purchase (Fig. 37).
Millennials’ high degree of connectivity with peers and other groups finds an expression in heightened social concerns, such as balancing inequalities around the world and making the world a better place through joint efforts of all of society.33 In relation to diamonds, these concerns take on the form of raised awareness and preference for responsibly sourced diamonds.
In research, when asked about the features of diamond engagement rings on which they are least willing to compromise, 36 per cent of single US Millennials in 2015 selected responsible sourcing. This compared with 27 per cent among older single consumers. In the Downstream chapter of this report we discussed Millennials’ higher propensity to stay away from diamond acquisition for lack of trust in the responsible sourcing of diamonds. These observations point to the need for coordinated actions across the diamond industry to ensure full visibility of diamond provenance, traceability and reassurance regarding origin, so that all consumers are aware of the good that diamonds do and can be confident that their own diamond has been responsibly sourced.
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Millennial consumers are a large and important cohort for the diamond industry despite the strong headwinds they still experience in terms of financial constraints in mature markets, the overwhelming noise of competition for their discretionary spend and a declining share of population in many markets. Millennials deliver volume and value growth underpinned by stable bridal consumption and potent desire for diamonds as gifts.
There are powerful opportunities among this generation to expand the non-bridal diamond acquisition. Self-purchase, acquiring for celebration of the individual and familial gifting are growing ways in which Millennials are accessing the market. In order to unlock this potential, diamond marketers need to understand the specifics of the lifetime values and preferences of this consumer cohort and find appropriate ways to engage Millennials’ strong inherent desire for diamonds by tailoring their offering for the various occasions and differentiating their proposition through branding and innovative designs.
While Millennials dream about diamonds, more needs to be done to make diamond jewellery a top of mind category and nurture a deeper emotional connection, so that diamonds become more relevant day to day, and that Millennials will, in turn, seed the love affair for future generations.
25 Pew Research Center, Millennials in Adulthood, March 2014.
26 De Beers-commissioned India Consumer Survey 2014.
27 Macromill, Japan Survey of Young People’s Attitudes, January 2015.
28 Currently the average age of first marriage in Japan is 29.7 (Statistics Bureau, Ministry of Internal Affairs and Communications, Japan. “Statistical Handbook of Japan 2014”, p. 18, Table 2.8 “Mean Age of First Marriage”), in the US it is 29 for men and 27 for women (Lydia Anderson & Krista K. Payne, National Center for Family & Marriage Research, Bowling Green State University, Median age at first marriage, 2014), in China it is 24.9 (2010 Population Censorship, Table 5–4, Chapter 5, Part 1) and in India it is 24.1 (Average age at Marriage – India, MedIndia, 2011).
29 De Beers commissioned Lens into China, Exploratory research, 2011.
30 JWT Intelligence, Meet the BRIC Millennials, 2013.
31 The Millennial Consumer Index from Bite Group and Redshift, 2013.
32 Antonio Achile, BCG, True-Luxury Consumer Insight, 2016.
33 JWT Intelligence, Meet the BRIC Millennials, 2013.