THE diamond invention
-- the creation of the idea that diamonds are rare and valuable,
and are essential signs of esteem -- is a relatively recent
development in the history of the diamond trade. Until the
late nineteenth century, diamonds were found only in a few
riverbeds in India and in the jungles of Brazil, and the
entire world production of gem diamonds amounted to a few
pounds a year. In 1870, however, huge diamond mines were
discovered near the Orange River, in South Africa, where
diamonds were soon being scooped out by the ton. Suddenly,
the market was deluged with diamonds. The British financiers
who had organized the South African mines quickly realized
that their investment was endangered; diamonds had little
intrinsic value -- and their price depended almost entirely
on their scarcity. The financiers feared that when new mines
were developed in South Africa, diamonds would become at
best only semiprecious gems.
The major investors
in the diamond mines realized that they had no alternative
but to merge their interests into a single entity that would
be powerful enough to control production and perpetuate
the illusion of scarcity of diamonds. The instrument they
created, in 1888, was called De Beers Consolidated Mines,
Ltd., incorporated in South Africa. As De Beers took control
of all aspects of the world diamond trade, it assumed many
forms. In London, it operated under the innocuous name of
the Diamond Trading Company. In Israel, it was known as
"The Syndicate." In Europe, it was called the "C.S.O." --
initials referring to the Central Selling Organization,
which was an arm of the Diamond Trading Company. And in
black Africa, it disguised its South African origins under
subsidiaries with names like Diamond Development Corporation
and Mining Services, Inc. At its height -- for most of this
century -- it not only either directly owned or controlled
all the diamond mines in southern Africa but also owned
diamond trading companies in England, Portugal, Israel,
Belgium, Holland, and Switzerland.
De Beers proved
to be the most successful cartel arrangement in the annals
of modern commerce. While other commodities, such as gold,
silver, copper, rubber, and grains, fluctuated wildly in
response to economic conditions, diamonds have continued,
with few exceptions, to advance upward in price every year
since the Depression. Indeed, the cartel seemed so superbly
in control of prices -- and unassailable -- that, in the
late 1970s, even speculators began buying diamonds as a
guard against the vagaries of inflation and recession. The
diamond invention is far more than a monopoly for fixing
diamond prices; it is a mechanism for converting tiny crystals
of carbon into universally recognized tokens of wealth,
power, and romance. To achieve this goal, De Beers had to
control demand as well as supply. Both women and men had
to be made to perceive diamonds not as marketable precious
stones but as an inseparable part of courtship and married
life. To stabilize the market, De Beers had to endow these
stones with a sentiment that would inhibit the public from
ever reselling them. The illusion had to be created that
diamonds were forever -- "forever" in the sense that they
should never be resold.
In September of
1938, Harry Oppenheimer, son of the founder of De Beers
and then twenty-nine, traveled from Johannesburg to New
York City, to meet with Gerold M. Lauck, the president of
N. W. Ayer, a leading advertising agency in the United States.
Lauck and N. W. Ayer had been recommended to Oppenheimer
by the Morgan Bank, which had helped his father consolidate
the De Beers financial empire. His bankers were concerned
about the price of diamonds, which had declined worldwide.
In Europe, where
diamond prices had collapsed during the Depression, there
seemed little possibility of restoring public confidence
in diamonds. In Germany, Austria, Italy, and Spain, the
notion of giving a diamond ring to commemorate an engagement
had never taken hold. In England and France, diamonds were
still presumed to be jewels for aristocrats rather than
the masses. Furthermore, Europe was on the verge of war,
and there seemed little possibility of expanding diamond
sales. This left the United States as the only real market
for De Beers's diamonds. In fact, in 1938 some three quarters
of all the cartel's diamonds were sold for engagement rings
in the United States. Most of these stones, however, were
smaller and of poorer quality than those bought in Europe,
and had an average price of $80 apiece. Oppenheimer and
the bankers believed that an advertising campaign could
persuade Americans to buy more expensive diamonds.
Oppenheimer suggested
to Lauck that his agency prepare a plan for creating a new
image for diamonds among Americans. He assured Lauck that
De Beers had not called on any other American advertising
agency with this proposal, and that if the plan met with
his father's approval, N. W. Ayer would be the exclusive
agents for the placement of newspaper and radio advertisements
in the United States. Oppenheimer agreed to underwrite the
costs of the research necessary for developing the campaign.
Lauck instantly accepted the offer.
In their subsequent
investigation of the American diamond market, the staff
of N. W. Ayer found that since the end of World War I, in
1919, the total amount of diamonds sold in America, measured
in carats, had declined by 50 percent; at the same time,
the quality of the diamonds, measured in dollar value, had
declined by nearly 100 percent. An Ayer memo concluded that
the depressed state of the market for diamonds was "the
result of the economy, changes in social attitudes and the
promotion of competitive luxuries."
Although it could
do little about the state of the economy, N. W. Ayer suggested
that through a well-orchestrated advertising and public-relations
campaign it could have a significant impact on the "social
attitudes of the public at large and thereby channel American
spending toward larger and more expensive diamonds instead
of "competitive luxuries." Specifically, the Ayer study
stressed the need to strengthen the association in the public's
mind of diamonds with romance. Since "young men buy over
90% of all engagement rings" it would be crucial to inculcate
in them the idea that diamonds were a gift of love: the
larger and finer the diamond, the greater the expression
of love. Similarly, young women had to be encouraged to
view diamonds as an integral part of any romantic courtship.
Since the Ayer
plan to romanticize diamonds required subtly altering the
public's picture of the way a man courts -- and wins --
a woman, the advertising agency strongly suggested exploiting
the relatively new medium of motion pictures. Movie idols,
the paragons of romance for the mass audience, would be
given diamonds to use as their symbols of indestructible
love.
In addition, the
agency suggested offering stories and society photographs
to selected magazines and newspapers which would reinforce
the link between diamonds and romance. Stories would stress
the size of diamonds that celebrities presented to their
loved ones, and photographs would conspicuously show the
glittering stone on the hand of a well-known woman. Fashion
designers would talk on radio programs about the "trend
towards diamonds" that Ayer planned to start. The Ayer plan
also envisioned using the British royal family to help foster
the romantic allure of diamonds. An Ayer memo said, "Since
Great Britain has such an important interest in the diamond
industry, the royal couple could be of tremendous assistance
to this British industry by wearing diamonds rather than
other jewels." Queen Elizabeth later went on a well-publicized
trip to several South African diamond mines, and she accepted
a diamond from Oppenheimer.
In addition to
putting these plans into action, N. W. Ayer placed a series
of lush four-color advertisements in magazines that were
presumed to mold elite opinion, featuring reproductions
of famous paintings by such artists as Picasso, Derain,
Dali, and Dufy. The advertisements were intended to convey
the idea that diamonds, like paintings, were unique works
of art.
BY 1941, The advertising
agency reported to its client that it had already achieved
impressive results in its campaign. The sale of diamonds
had increased by 55 percent in the United States since 1938,
reversing the previous downward trend in retail sales. N.
W. Ayer noted also that its campaign had required "the conception
of a new form of advertising which has been widely imitated
ever since. There was no direct sale to be made. There was
no brand name to be impressed on the public mind. There
was simply an idea -- the eternal emotional value surrounding
the diamond." It further claimed that "a new type of art
was devised ... and a new color, diamond blue, was created
and used in these campaigns.... "
In its 1947 strategy
plan, the advertising agency strongly emphasized a psychological
approach. "We are dealing with a problem in mass psychology.
We seek to ... strengthen the tradition of the diamond engagement
ring -- to make it a psychological necessity capable of
competing successfully at the retail level with utility
goods and services...." It defined as its target audience
"some 70 million people 15 years and over whose opinion
we hope to influence in support of our objectives." N. W.
Ayer outlined a subtle program that included arranging for
lecturers to visit high schools across the country. "All
of these lectures revolve around the diamond engagement
ring, and are reaching thousands of girls in their assemblies,
classes and informal meetings in our leading educational
institutions," the agency explained in a memorandum to De
Beers. The agency had organized, in 1946, a weekly service
called "Hollywood Personalities," which provided 125 leading
newspapers with descriptions of the diamonds worn by movie
stars. And it continued its efforts to encourage news coverage
of celebrities displaying diamond rings as symbols of romantic
involvement.In
1947, the agency commissioned a series of portraits of "engaged
socialites." The idea was to create prestigious "role models"
for the poorer middle-class wage-earners. The advertising
agency explained, in its 1948 strategy paper, "We spread
the word of diamonds worn by stars of screen and stage,
by wives and daughters of political leaders, by any woman
who can make the grocer's wife and the mechanic's sweetheart
say 'I wish I had what she has.'"
De Beers needed
a slogan for diamonds that expressed both the theme of romance
and legitimacy. An N. W. Ayer copywriter came up with the
caption "A Diamond Is Forever," which was scrawled on the
bottom of a picture of two young lovers on a honeymoon.
Even though diamonds can in fact be shattered, chipped,
discolored, or incinerated to ash, the concept of eternity
perfectly captured the magical qualities that the advertising
agency wanted to attribute to diamonds. Within a year, "A
Diamond Is Forever" became the official motto of De Beers.
In 1951, N. W.
Ayer found some resistance to its million-dollar publicity
blitz. It noted in its annual strategy review:
The millions
of brides and brides-to-be are subjected to at least two
important pressures that work against the diamond engagement
ring. Among the more prosperous, there is the sophisticated
urge to be different as a means of being smart.... the
lower-income groups would like to show more for the money
than they can find in the diamond they can afford....
To remedy these
problems, the advertising agency argued, "It is essential
that these pressures be met by the constant publicity to
show that only the diamond is everywhere accepted and recognized
as the symbol of betrothal."
N. W. Ayer was
always searching for new ways to influence American public
opinion. Not only did it organize a service to "release
to the women's pages the engagement ring" but it set about
exploiting the relatively new medium of television by arranging
for actresses and other celebrities to wear diamonds when
they appeared before the camera. It also established a "Diamond
Information Center" that placed a stamp of quasi-authority
on the flood of "historical" data and "news" it released.
"We work hard to keep ourselves known throughout the publishing
world as the source of information on diamonds," N. W. Ayer
commented in a memorandum to De Beers, and added: "Because
we have done it successfully, we have opportunities to help
with articles originated by others."
N. W. Ayer proposed
to apply to the diamond market Thorstein Veblen's idea,
stated in The Theory of the Leisure Class, that Americns
were motivated in their purchases not by utility but by
"conspicuous consumption." "The substantial diamond gift
can be made a more widely sought symbol of personal and
family success -- an expression of socio-economic achievement,"
N. W. Ayer said in a report. To exploit this desire for
conspicuous display, the agency specifically recommended,
"Promote the diamond as one material object which can reflect,
in a very personal way, a man's ... success in life." Since
this campaign would be addressed to upwardly mobile men,
the advertisements ideally "should have the aroma of tweed,
old leather and polished wood which is characteristic of
a good club."
Toward the end
of the 1950s, N. W. Ayer reported to De Beers that twenty
years of advertisements and publicity had had a pronounced
effect on the American psyche. "Since 1939 an entirely new
generation of young people has grown to marriageable age,"
it said. "To this new generation a diamond ring is considered
a necessity to engagements by virtually everyone." The message
had been so successfully impressed on the minds of this
generation that those who could not afford to buy a diamond
at the time of their marriage would "defer the purchase"
rather than forgo it.
THE campaign to
internationalize the diamond invention began in earnest
in the mid-1960s. The prime targets were Japan, Germany,
zand Brazil. Since N. W. Ayer was primarily an American
advertising agency, De Beers brought in the J. Walter Thompson
agency, which had especially strong advertising subsidiaries
in the target countries, to place most of its international
advertising. Within ten years, De Beers succeeded beyond
even its most optimistic expectations, creating a billion-dollar-a-year
diamond market in Japan, where matrimonial custom had survived
feudal revolutions, world wars, industrialization, and even
the American occupation.
Until the mid-1960s,
Japanese parents arranged marriages for their children through
trusted intermediaries. The ceremony was consummated, according
to Shinto law, by the bride and groom drinking rice wine
from the same wooden bowl. There was no tradition of romance,
courtship, seduction, or prenuptial love in Japan; and none
that required the gift of a diamond engagement ring. Even
the fact that millions of American soldiers had been assigned
to military duty in Japan for a decade had not created any
substantial Japanese interest in giving diamonds as a token
of love.
J. Walter Thompson
began its campaign by suggesting that diamonds were a visible
sign of modern Western values. It created a series of color
advertisements in Japanese magazines showing beautiful women
displaying their diamond rings. All the women had Western
facial features and wore European clothes. Moreover, the
women in most of the advertisements were involved in some
activity -- such as bicycling, camping, yachting, ocean
swimming, or mountain climbing -- that defied Japanese traditions.
In the background, there usually stood a Japanese man, also
attired in fashionable European clothes. In addition, almost
all of the automobiles, sporting equipment, and other artifacts
in the picture were conspicuous foreign imports. The message
was clear: diamonds represent a sharp break with the Oriental
past and a sign of entry into modern life.
The campaign was
remarkably successful. Until1959, the importation of diamonds
had not even been permitted by the postwar Japanese government.
When the campaign began, in 1967, not quite 5 percent of
engaged Japanese women received a diamond engagement ring.
By 1972, the proportion had risen to 27 percent. By 1978,
half of all Japanese women who were married wore a diamond;
by 1981, some 60 percent of Japanese brides wore diamonds.
In a mere fourteen years, the 1,500-year Japanese tradition
had been radically revised. Diamonds became a staple of
the Japanese marriage. Japan became the second largest market,
after the United States, for the sale of diamond engagement
rings.
In America, which
remained the most important market for most of De Beer's
diamonds, N. W. Ayer recognized the need to create a new
demaind for diamonds among long-married couples. "Candies
come, flowers come, furs come," but such ephemeral gifts
fail to satisfy a woman's psychological craving for "a renewal
of the romance," N. W. Ayer said in a report. An advertising
campaign could instill the idea that the gift of a second
diamond, in the later years of marriage, would be accepted
as a sign of "ever-growing love." In 1962, N. W. Ayer asked
for authorization to "begin the long-term process of setting
the diamond aside as the only appropriate gift for those
later-in-life occasions where sentiment is to be expressed."
De Beers immediately approved the campaign.
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