The stability in share of demand for the 18–34 age group in the US over the past couple of decades is grounded in the undiminishing desire this age group holds for diamonds as a gift.
Diamonds rank high on the list of most-desired gifts, with only overseas holidays, weekend getaways and personal electronics being more valued. Foreign travel has always held the greatest allure for US consumers, with overseas trips ranked first back in 2003. In the intervening 13 years, short holidays and personal electronics have become more desirable for Millennials, who prioritise experiences over material goods, but still desire smart electronic devices due to their need for interconnectedness.
In Japan, diamonds are more desirable as gifts to Millennials than they are to the older generations. Fine jewellery ranks as their top gift preference and, when questioned further about their most- desired type of jewellery, 34 per cent of Millennials choose diamonds over any other type of jewellery, compared with older generations who stated a 30 per cent preference.
Among Chinese Millennials, diamond jewellery is the most desired fine jewellery item to own, with 52 per cent placing it at number one, compared with 43 per cent for older generations.
Fine jewellery in India far outweighs other luxury or experiential categories in terms of desirability: 63 per cent of Millennials wish to buy it for themselves and 46 per cent hope to receive it as a gift. Traditionally in India’s jewellery-buying and gifting tradition, gold has been and remains the favourite choice, due to its function as a liquid asset. Among socio-economic classes A/B (excluding the Elites) 55 per cent of Indian Millennials pick gold first, with 23 per cent preferring diamonds (for older age groups this is 58 per cent and 22 per cent respectively).
It is notable though, that among all ages in the Elite segment, 75 per cent of women place diamonds as their first preference in fine jewellery, with only six per cent preferring gold. This is especially positive, given the aspirational nature of diamonds in this market and the likelihood that the other affluent consumers will follow in the footsteps of the most affluent when their income levels rise.
Introducing young people to diamonds early in their lives is a strong driver of Millennial long-term engagement with the category.
Diamond jewellery ownership among Millennials is high in the US, with 62 per cent owning at least one piece of diamond jewellery (Fig. 23). That figure jumps from 48 per cent of 18 – 24 year olds to 72 per cent of 25–34 year olds, comparing favourably with the 76 per cent seen among older consumers, and suggesting that diamonds are maintaining relevance for the young who grow into the category. On average, US Millennials who own diamond jewellery own 5.3 pieces, while 15 per cent of them own eight pieces or more. De Beers’ analysis has shown that high levels of diamond ownership in later years highly correlates with early first acquisition of diamonds – so US Millennials are well positioned, as a fifth of America’s Millennial diamondowners acquired their first piece before their sixteenth birthday. Among those older than 35, only 15 per cent acquired at this age. This points to a considerable opportunity for diamond gifting to Millennials by older generations. This is discussed further in this section.
Diamond ownership levels in the other main markets are lower than in the US, but in India (10 per cent) this is in line with ownership among the older generations, and in China (20 per cent among all Millennials) it peaks among the 25–34 year olds (29 per cent). Japan is the only market where Millennial ownership is considerably lower (31 per cent) than older consumers’ ownership (66 per cent).
The proportions of diamond jewellery-buyers among Millennials, with the exception of India, are significantly higher than among those aged older than 35, with the 25 – 34 age group most active of all (Fig. 24). This can be explained by the fact that a very high proportion of bridal acquisitions fall within the Millennial segment, as discussed in more detail later in this chapter.
While the Bridal category has provided stability in markets where there is an established and growing diamond engagement ring tradition, non-bridal acquisition delivers the greatest growth opportunity for Millennials. Self-purchase of diamond jewellery among 18–34 year olds has increased to deliver a sizeable proportion of non-bridal diamond jewellery retail volumes in the US (Fig. 25) and India.24
Self-purchasing in the US has increased more among Millennials than older consumers recently, growing from a quarter of all non-bridal pieces acquired in 2013 to 31 per cent in 2015. Those same figures are 34 per cent and 37 per cent respectively for older consumers.
Another important acquisition route for Millennials is gifting from relatives other than partner or spouse. In the US, a diamond gift from parents and grandparents accounts for 15 per cent of non-bridal acquisitions by Millennials, but in the youngest age group of 18–24 it is as high as 31 per cent (Fig. 26).
24 In India the survey focused on purchasers, as this best reflects the decision making process in this market (decision made by the woman, while finance often is provided by a man in the family). Of all Millennial buyers 72 per cent bought for themselves, compared to 57 per cent among the older generations.