Part Three: The wrong question.
Short of Money and using the wrong tool.
Natural diamonds have a demand problem, and the industry’s answer has always been advertising. In the first two parts of this series I argued that branding can’t fix it, and that a serious global campaign would cost $300 to $400 million a year. Against the $36 million the industry actually spends.
A 90% shortfall is a joke. And it would be funny, expect that the 10% we are spending is going to the wrong tool anyway.
Remember the Milk mustache, Beyoncé, Muhammad Ali, David Beckham: over 300 celebrities featured in the campaign’s 20-year run. Hundreds of millions of dollars were spent at its peak, awareness hit 90%, and the agencies won every award possible.
US per capita milk consumption fell 46%; it fell before, during, and after the campaign. The most talked about advertising campaign in the US advertising industry did not increase consumption by a single percentage point.
Notice what milk actually bought. Full-page ads, the biggest names in the world in them, and every reader knowing exactly what they were looking at. It bought attention, and attention is what it got: 90% awareness, every award going, and a category that shrank the whole time.
Now consider a category that did reverse, without spending a dollar on advertising. Milk’s own child: butter.
Before WWII, the split between butter and margarine was 85% : 15%. Rationing during the war broke people’s butter habit, and by 1976 the roles had reversed: margarine held 75% of the category, butter 25%.
But here is the twist: by 2005, butter consumption had surpassed margarine even though it cost more. In 2015, butter was back up to 62% of the category.
Do you remember “Got Butter?” Campaigns? No. Because there weren’t any. Big Butter didn’t spend hundreds of millions promoting butter. To tell you the truth, there is no Big Butter either. The reversal started with a 1993 paper by Walter Willett from Harvard published in The Lancet that identified the link between trans fats and heart disease.
And no one was driving the narrative, no big butter funding research, amplifying the findings or pushing labelling norms. That is perhaps why the reversal took 30 years. A half-decent effort would have plausibly compressed the timelines.
But notice the precondition. The story was true. Trans fats were genuinely harmful. The science held up; if it hadn’t, there would have been no reversal.
Diamonds are not milk. Nobody needs one; you have to make them want one. If two decades of effort and hundreds of millions of dollars spent for something that everyone needs didn’t work, what chance do we have?
But someone did create a desire for diamonds once. De Beers hired N.W. Ayer in 1938 to create demand from scratch. There was no diamond engagement ring tradition before that. We all like to remember it as the greatest advertising campaign in history. Except that it wasn’t an advertising campaign at all.
In 1938, Harry Oppenheimer arrived in New York to engage N.W. Ayer to get diamonds out of the slump that had hit the trade hard after the depression years. The agency at that time found that only 10% of the engagement rings sold in the US contained diamonds. In their own words, they described it as a mass psychology problem they needed to solve.
One of the first things they did was reach out to Hollywood. They got them to insert diamond scenes into films. Claudette Colbert in Skylark, Merle Oberon wearing forty thousand dollar diamonds in That Uncertain Feeling. They even got Paramount to change the title of one of their films from “Diamonds are Dangerous” to “Adventures in Diamonds”
This alone increased sales by 55% in three years; there was no “Diamonds are forever” slogan yet.
In 1946, they started “Hollywood Personalities,” a weekly editorial service, feeding diamond stories to newspapers. These were not ads; it was editorial content. Next year they commissioned portraits of “engaged socialites” and had them placed as news photography. At the time, Ayer said, “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.’”
They even sent lecturers to high schools across the country. They set up a “Diamond Information Bureau” and made it the place the publishing world called for anything about diamonds, which meant they got invited into articles they hadn’t originated.
The list of tactics they adopted is long, but the most telling part is not the tactics but how they described it themselves. As Edward Jay Epstein recorded, Ayer’s memo to De Beers read: “It is the responsibility of the publicity effort to gain access to the editorial and news columns of magazines and newspapers, and thereby become part of the publication itself. In this manner, it carries the authority of a disinterested source.”
Frances Gerety wrote “A Diamond is Forever” only in 1947. It became the signature line in 1948. By that time, the PR operation was already running for a full decade. That slogan didn’t build the market; it merely amplified what PR had already built.
By the early 2000s De Beers was spending around $180 to $200 million a year on generic advertising, and when it cut that spending in 2008 the industry panicked. It panicked about the wrong thing. The advertising had been coasting on a foundation laid decades earlier, and that foundation had been abandoned long before the ad budget was.
That is the difference. Milk bought attention and got attention. Ayer bought belief, and belief is what built the market.
Which is why the money argument, real as it is, was never the whole problem. Branding won’t work. The money isn’t there. And even with the money, advertising isn’t the tool.
But PR only works if there is something true to say. Trans fats were genuinely harmful; that is why butter came back. So the question that matters now is the one butter raised. Do diamonds have a true story to tell?
I think they do. One idea per part from here.