The early morning line at Starbucks is very long, filled with optimistic jewelry manufacturers, driven diamond wholesalers, tired members of the trade press, eager toolmakers and many marketing folks. In most places in the civilized world, the Starbucks cappuccino is offensive, and in some even a punishable crime. The steaming water is very hot, burning the coffee in the process. In areas of Italy you may be flogged for such an offense, a crime far worse than adultery (for sure) tax evasion (of course) and perhaps even miss-matched socks.
Espresso, probably Italian for “quick and bitter,” is a very small cup of coffee and a way of life – a quick drink taken while standing by a bar, a brief conversation, and off you go back to work or home, refreshed.
Las Vegas is anything but an Italian espresso, more of a Starbucks cappuccino – too hot, over the top, propelled by superb marketing instead of great substance and awfully overpriced. In short, we need Howard Schultz in the diamond industry, especially if it prevents him from destroying decent coffee and still allows us to enjoy our essential caffeine fix.
The conversation in the coffee line drifts from the previous night’s social events – cocktail receptions, dancing, business dinners and losses at the blackjack tables – to plans and meetings for the day. More than anything, everyone is busy collecting information: prices, terms of payment, who is doing what, which items were seen and where, recommended educational sessions and other information. Very little is said about propelling the diamond jewelry category so it captures greater market share at the expense of handbags or cool gadgets, and no one is talking about the economics of the industry.
The economic fundamentals are constantly being challenged. Banks want more equity against provided credit, miners want higher prices for their rough diamonds, manufacturers are taking some of their income out of the business to balance and protect their earnings, jewelry manufacturers are hit by wild gold prices, Basel III requires more transparency which scares everyone because they are jumping through hoops with all sorts of exercises just to make ends meet, and retailers, bless their hearts – they mainly care for none of this. All they want is a customer to walk into their door so they can generate some turnover. They are blissfully ignorant of the funds they provide that keep the wild mechanics of the industry running.[/two_third]
“Banks want more equity against provided credit, miners want higher prices for their rough diamonds, manufacturers are taking some of their income out of the business to balance and protect their earnings, jewelry manufacturers are hit by wild gold prices, Basel III requires more transparency…”
Of course, bad coffee at the end of a long line at 7:30am in Las Vegas after a night of celebrating does not make matters any better. Slugging into the exhibition area, competing exhibitors are exchanging friendly words, they are brothers-in-arms after all, while journalists pile into the pressroom for breakfast, PR CD collecting, some reporting and more information exchange.
In the pressroom, there is a grand view of hotels and the desert stretching beyond serving as an appropriate backdrop. A combination of glitz and dust, artificial and natural, forced low temperatures and rising dry heat, fabricated and natural, a manifestation of will and the resignation of earth.
The created and left alone are at the heart of the diamond and jewelry industry and its economics. We try to shape it, but some things are left untouched, left alone until we decide to address them.
We need to improve transparency to ensure the mechanics of the industry work better, we need more marketing to better compete for consumers’ discretionary income, we must be innovative to remain relevant, we have to understand how the different sections of the industry pipeline work because it influences other parts of the industry, and we must be able to work with governments because new laws and regulations all over the world are impacting our business in the long term – usually for the worse. Moreover, we must have better coffee to keep us running through it all, otherwise what is the point?
The Las Vegas jewelry shows are probably the most important to the industry today. They provide a chance to trade, meet, exchange ideas, be introduced to new contacts, learn and serve the largest market at an exceptional scale.
“Improve transparency, more marketing, be innovative, understand how the different sections of the industry pipeline work, work with governments.”
In the line to see Maroon 5, the big relief and bonus after all the hard work, a very large crowd is slowly moving forward. Very little of the talk is about business, mostly a social opportunity and chatter. In the back of their minds, many were already summing up the fair, the follow-up work needed, the orders to work on, and thoughts about how to make good use of what was learned.
As I shamelessly slipped into the VIP line (with the help of my VIP friends), I was more concerned about who is thinking about the macro, the overall scheme of things and the path ahead. Is there a Howard Schultz-like visionary and powerhouse who would pull everyone forward and expand the diamond jewelry category? We had better hope so. If not, we must invent that person.