Millennials spent more than US$25bn (£18.8bn) on diamond jewellery in 2015 in the four largest consumer markets, acquiring more than any other generation, according to The Diamond Insight Report 2016, published today by The De Beers Group of Companies.
The Millennial generation is not expected to reach its most affluent life stage for another 10 years, meaning this demographic also represents the diamond sector’s largest growth opportunity.
Despite Millennials (people aged 15-34 in 2015) facing more financial challenges than their parents’ generation, they already account for almost half of the total retail value of new diamond jewellery acquired in the four largest markets – the US, China, Japan and India.
In the top four markets, which account for 73% of global diamond jewellery demand, the potential Millennial market for diamond jewellery is more than 220 million people.
According to the report, millennial consumers also display particular purchasing trends. For example, self-purchasing of diamond jewellery is an important and growing acquisition route among Millennials, with this generation’s self-purchases in the US representing 31% of all non-bridal diamond jewellery pieces acquired in 2015. Given the differences from previous generations’ buying behaviours, the diamond industry will need to adopt effective strategies for maintaining and growing demand from the Millennial consumer group, the report claims.
Bruce Cleaver, CEO at De Beers Group, said: “Millennials are already expressing very strong demand for diamond jewellery in the major consumer markets, acquiring more than any other generation.
“Most encouragingly, however, Millennials are still 10 years away from their most affluent life stage and the generation comprises more than 220 million potential diamond consumers in the four main markets. The diamond industry therefore has a major opportunity on the horizon but it will only capitalise on it fully if it continues to innovate and invest across the value chain.”
Alongside suggesting ways in which the industry could capitalise on the opportunity with the Millennial generation, the report also found that:
- Despite lower rough diamond demand in 2015, consumer diamond jewellery demand remained robust at US$79bn, driven by 5% growth in the US.
- China, the second largest market, also saw growth, albeit at a lower rate (3% in local currency). In India, consumer demand slowed as a result of a more restricted consumer credit environment and overall weakness in consumer spending.
- Consumer demand growth will continue to be generated from the US and Asia, particularly China and India, driven by increasing household income over the next 10 years.