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KEY TREND 01

INCREASED PARTICIPATION OF WOMEN IN THE ECONOMY

More women than ever before across the world are in paid employment and their earnings are on the rise. As a result, they are buying more diamond jewellery for themselves, but their motivations for purchase, and the types of jewellery they buy, vary across the major consumer nations.

GLOBAL ECONOMIC DEVELOPMENT HAS ENABLED WOMEN’S INCREASED PARTICIPATION IN THE WORKFORCE

The number of working women has been on the rise for many years. In most member countries of the Organisation for Economic Co-operation and Development (OECD),2 the proportion of women aged 25 to 54 in the workforce continues to increase. In 1980, this figure stood at 54 per cent (Fig. 2). By 2010, it had risen to 71 per cent, albeit with significant differences in the rate of growth between countries.

Today, in the US, 69 per cent of Millennial women aged 18 to 33 are in the labour force, compared with 78 per cent of men in the same age group. This is a significant shift from the Baby Boomer generation: in 1963, the participation of men aged 18 to 33 stood at 88 per cent, and women of the same age group at 41 per cent.3

These trends are bringing about rapid changes in the relative earning power of the genders. Research indicates that 24 per cent of women in the US and 25 per cent in China are already earning more than their spouses. And it forecasts that more than half of all US households will have a woman as a major income-provider by 2025.4

The narrowing gap in labour force participation between men and women is also leading to a corresponding decline in the difference between their earnings.

FIG. 2: HISTORIC PARTICIPATION IN LABOUR FORCE (OECD COUNTRIES, POPULATION AGED 25-54) TOTAL POPULATION (25-54) IN LABOUR FORCE NOT IN LABOUR FORCE WOMEN (25-54) IN LABOUR FORCE NOT IN LABOUR FORCE 1980 76% 2010 81% VS 1980 54% VS 2010 71% Note: For full-time wage and salary workers. Source: US Department of Labor, Bureau of Labor Statistics, BLS Report 1064, Novermber 2016.

Women’s earnings growth (Fig. 3) is one direct result of the 21st century’s significant increase in female participation in tertiary education. The percentage of women across the world aged 25 to 64 who have completed higher education rose from 21 per cent in 2000 to 38 per cent in 2015.5

And it’s not only the earning power of women that is changing as a result of increased participation in tertiary education. Their role within the home is also evolving as their responsibilities as providers for their families increase (Fig. 4). This is a role they welcome: research from the global marketing communications company J. Walter Thompson shows that 72 per cent of women globally say that they’re proud to be a good provider.6

Female advancement over the last half century has been on many fronts besides economic empowerment. Women also have increasing power and influence in leadership roles in business and politics, the media and other fields, creating new role models in many spheres of life.

FIG. 3: INCREASED EARNINGS OF US WOMEN (US WOMEN'S EARNINGS AS A PERCENTAGE OF MEN'S) 1980 64% VS 2010 81% Note: For full-time wage and salary workers. Source: US Department of Labor, Bureau of Labor Statistics, BLS Report 1064, November 2016.
FIG. 4: HOUSEHOLDS CURRENTLY WITH WOMEN AS THE MAJOR INCOME-PROVIDER US CHINA US (2025 FORECAST)

Source: JWT Women's Index Study, 2015.


CASE STUDY: FEMALE TRIBES

As Group Planning Head at J. Walter Thompson (JWT), one of the world’s largest marketing communications and advertising businesses, Rachel Pashley has long felt the need to address the ways in which women are presented in advertising.

“Advertising is repetitive. It has to be in order to have impact and be memorable,” Rachel says. “But this can easily create and reinforce stereotypes. And when JWT research reveals that only 10 per cent of women portrayed in advertising has gainful employment, versus 70 per cent in the actual population, you can see that the cultural conversation needs to change.”

That’s why Rachel has pioneered ‘Female Tribes’, a unique, rolling study that over the last two years has talked to more than 8,000 women aged 17 to 70 in 19 countries about many aspects of their lives.

Many of the findings that relate to diamond jewellery are used in this report.

And, she says, the research results are exploding myths about women’s attitudes. “We found a quite staggering level of ambition – alpha females succeeding in their careers, regardless of country, age or parental status,” she says. “Motherhood actually intensifies that drive to excel.”

The researchers also identified ‘tribes’ with different motivations, from the self-focused ‘hedonist’ to the adventureseeking ‘explorer’, each with her own motivation for buying diamonds. “For the hedonist, the buying experience is as important as the piece itself,” Rachel says. “For the explorer, an exotic provenance can express her uniqueness.”

Rachel believes there are lessons here for jewellery retailers: “Today’s buying experience is too serious. Make it fun, self-gratifying – learn from the intensely experiential approach taken by skincare companies. Give women ‘permission’ to reward themselves.

“Above all, ensure your communications embrace the possibilities, not the responsibilities, of being a woman.”


THE CONSEQUENCES FOR THE DIAMOND INDUSTRY: SELF-PURCHASE IS AT RECORD HIGHS

The steady increase in female economic influence is closely related to women’s growing social empowerment. These two forces are transforming the behaviour of female consumers, whose financial independence and confidence are growing simultaneously.

De Beers’ research shows that women are increasingly active purchasers of diamond jewellery. In 2016 in the US, 31 per cent of all women’s diamond jewellery was bought by women themselves (Fig. 5).

Self-purchasing of non-bridal diamond jewellery pieces grew in the US by more than a third between 2005 and 2015, reaching 33 per cent (Fig. 6).

And even when women are not buying for themselves, their influence on purchase decisions remains important. Women often choose gifted jewellery themselves or have input into its selection. In the US, women influence the choice of piece in 42 per cent of all diamond jewellery gifts. And their influence is even higher in Japan and China (Fig. 5).

One country with a unique purchasing profile is India, where self-purchase is an established cultural norm. Unlike in Japan and China, there has been no adoption here of the Western engagement ring tradition. Instead, women make 41 per cent of purchases for themselves. Another 42 per cent are chosen by women, despite being paid for by somebody else.7

FIG. 5: SHARE OF SELF-PURCHASED DIAMOND JEWELLERY PIECES (% PIECES) SELF-PURCHASE PROPORTION IN THE TOTAL WOMEN'S SECTOR (INC BRIDAL) US CHINA JAPAN 31 26 35 SELF-PURCHASE PROPORTION IN THE NON-BRIDAL WOMEN'S SECTOR US CHINA JAPAN 33 39 43 WOMEN INFLUENCING GIFT PURCHASE DECISIONS IN TOTAL WOMEN'S SECTOR US CHINA JAPAN 42 83 70 Source: De Beers-commissioned diamond acquisition studies, 2014-2016. FIG. 6: SHARE OF SELF-PURCHASED DIAMOND JEWELLERY IN THE US NON-BRIDAL WOMEN'S SECTOR 2005-2015 (% PIECES) 35 30 25 2005 2011 2013 2015 23 24 27 33 Source: De Beers-commissioned diamond acquisition studies, 2005-2016.

THE ONGOING DESIRABILITY OF DIAMONDS

Increasing levels of self-purchase show that women’s wish to possess diamonds remains high across the world.

While women’s desire to be given diamonds is strong in all countries, those in China and India are keener to buy for themselves than their counterparts in Japan and the US. This is due to the aspirational nature of diamonds in emerging markets where the tradition of buying them is relatively new. The Indian Elites,8 the most affluent segment of society in India, is a case in point.

This group’s increasing affluence is leading a shift in traditional values, from a preference for gold to an increasing demand for diamonds. And, as the Indian middle classes continue to grow and increase their wealth, the country’s broader affluent9 consumer segments are likely to follow this lead.

In fact, when women in all main diamond consumer nations are given a free choice of having anything from a list of aspirational and luxury products (regardless of cost), they report a high desire to be given or to buy diamond jewellery (Fig. 7).

“If I buy from my own salary, I will always cherish it. It’s also a sense of achievement.”

FEMALE, INDIA

Source: Forevermark-commissioned research, 2016.

“I saw a four-carat dress ring. I liked it, so I bought it.” 

FEMALE, US

Source: Forevermark-commissioned research, 2014.

FIG. 7: DESIRABILITY OF DIAMONDS IN SOME OF THE TOP DIAMOND CONSUMER NATIONS

Ranking of diamond jewellery as most desired item:

US AS A GIFT SELF-PURCHASE 3rd 8th CHINA AS A GIFT SELF-PURCHASE 1st 1st INDIA AS A GIFT SELF-PURCHASE Affluents 2nd 2nd Elites 1st 1st

Source: De Beers-commissioned diamond acquisition studies, 2014–2016.

THE RETAIL OPPORTUNITY: WHO IS BUYING, WHAT THEY’RE BUYING, AND WHY THEY’RE BUYING

WHO?

The profile of self-purchasers

De Beers’ research shows that self-purchase in the US and Japan is more likely to be among married women, while in China it is the single women who acquire for themselves. Most self-purchasers in the three main diamond markets are aged over 35 and have medium to high income levels (Fig. 8).

WHAT?

The pieces that women are buying for themselves

The most popular types of jewellery for self-purchase are rings across all markets. In China, rings account for more than half of all self-purchases. In the US, earrings follow close behind rings. While in Japan, necklaces are the second most common self-purchase (Fig. 9).

The average price of self-purchased diamond jewellery tends to be slightly lower than that of all diamond jewellery acquired for women (including items bought as gifts). While the price differential isn’t very large in the US and China, it’s more notable in Japan (Fig. 10).

FIG. 8: PROFILE OF SELF- PURCHASING BY TYPE OF ACQUIRER (% OF ALL SELF-PURCHASED PIECES) US CHINA JAPAN MARITAL STATUS MARRIED 57 SINGLE 43 MARRIED 36 SINGLE 64 MARRIED 71 SINGLE 29 AGE 18-34 32 35-54 39 55-74 29 18-29 21 30-54 79 18-34 32 35-59 39 60+ 29 INCOME ANNUAL MONTHLY ANNUAL <US$39K 16 ¥7K (<US$13K, ANNUAL) 15 <¥5M (<US$45K) 31 US$40–74K 20 <¥7K–14,999 (<US$13–27K, ANNUAL) 76 ¥5-9.99M (US$45-90K) 45 US$75-150K 43 >¥15K (>US$27K,ANNUAL) 9 >¥10M (>US$90K) 24 US$150K 21 Source: De Beers-commissioned diamond acquisition studies, 2014-2016. FIG. 9: PROFILE OF SELF-PURCHASING BY TYPE OF PRODUCT (% OF ALL SELF-PURCHASED PIECES) US CHINA JAPAN 37 51 45 31 24 14 18 22 37 10 1 2 3 2 2 RING EARRINGS NECKLACE BRACELET OTHER Note: Some figures may not add up to 100 per cent due to rounding. FIG. 10: AVERAGE PRICE OF SELF-PURCHASES AGAINST MARKET AVERAGE US CHINA JAPAN AVERAGE PRICE OF SELF-PURCHASE (US$) AVERAGE PRICE ACROSS TOTAL WOMEN'S MARKET (US$) VS VS VS 1,300 1,400 950 (RMB6,400) 1,100 (RMB7,600) 1,400 (¥60,500) 1,700 (¥93,400) Source: De Beers-commissioned diamond acquisition studies, 2014–2016.

WHY?

Profile of self-purchasing by occassion and motivation

Most commonly, self-purchase results from a spontaneous decision rather than being motivated by a specific occasion (Fig. 11). This emphasises the importance of jewellery and the retail environment to stimulate impulse desire.

The motivations that drive diamond acquisitions differ by country. In the US, the top motivator is good price (23 per cent). However, in the remaining 77 per cent of purchases, the driving reasons are much more emotional. Emotional drivers are particularly powerful in China, with celebration of relationship and personal milestones topping the list, while Japanese women buy on impulse (Fig. 12).

The story is different in India, where single women are likely to buy diamond jewellery once they have saved enough after starting work. These are often important ‘milestone’ purchases which give them a powerful sense of achievement. Married women in India buy for themselves to fulfil a long-held dream.10

HOW?

Researching self-purchases

Often, self-purchasing is done on impulse and for no specific occasion. As such, significant proportions of self-purchases are made without any prior research, ranging from 21 per cent in China to 40 per cent in the US.

However, when it comes to planned acquisitions, the internet – with its ability to combine communications with selling – is a major source of information on brands, designs and prices, particularly in the US and Japan (Fig. 13).

FIG. 11: PROFILE OF SELF-PURCHASING BY OCCASION FOR ACQUISITION (% OF ALL SELF-PURCHASED PIECES) US No specific occasion 41 Birthday 15 All other 44 CHINA No specific occasion 27 Birthday other than 18th/20th 26 All other 47 JAPAN No specific occasion 45 Reward to myself (work achievement/success/promotion) 26 All other 29 FIG. 12: PROFILE OF SELF-PURCHASING BY MOTIVATION FOR ACQUISITION (% OF ALL SELF-PURCHASED PIECES) US Sale/the price was very good 23 On impulse/to have a very nice treat 18 Unique/unusual design 14 Personal milestones 10 Relationship milestones (engagement, wedding, wedding anniversary) 8 All other 27 CHINA Relationship milestones (engagement, wedding, wedding anniversary) 22 Personal milestones 18 On impulse/to have a very nice treat 16 Sale/the price was very good 12 To express love and/or commitment (not linked to a milestone) 12 All other 21 JAPAN On impulse/to have a very nice treat 25 Sale/the price was very good 17 Personal milestones 12 To cheer me up/get through a difficult time 12 Unique/unusual design 9 All other 25 Note: Some figures may not add up to 100 per cent due to rounding. FIG. 13: RESEARCHING SELF-PURCHASES (% OF ALL SELF-PURCHASED PIECES) ONLINE US CHINA JAPAN 72 41 55 STORE VISITS US CHINA JAPAN 23 54 20 MAGAZINES/ADVERTISING*/ CELEBRITY ENDORSEMENT** US CHINA JAPAN 31 4 5 NONE US CHINA JAPAN 40 21 37 Note: Multiple options are possible for each purchase. * In the US. ** In China and Japan. Source: De Beers-commissioned diamond acquisition studies, 2015 and 2016.

2. For a list of OECD countries, please refer to http://www.oecd.org/about/membersandpartners/.
3. http://www.pewsocialtrending.org/2015/03/19/comparing-millennials-to-other-generations.
4. JWT Women’s Index Study, 2015, covering 17 countries with a sample of 7,000 women.
5. OECD (2017), Adult education level (indicator), doi: 10.1787/36bce3fe-en (accessed on 21 July 2017).
6. JWT Women’s Index Study 2015, covering 17 countries with a sample of 7,000 women.
7. De Beers-commissioned diamond purchasing study, India, 2014.
8. Elites in India are defined as consumers in socio-economic groups A and B who own a car costing more than US$15,000, are members of a prestigious club or take holiday or business trips abroad annually.
9. Socio-economic classes A and B in India are defined as households where the main income earner has at least a university degree and is a business owner, professional, corporate manager or performs skilled labour.
10. Forevermark-commissioned qualitative research, 2016.