Rapaport Magazine - October 2021

VOL. 44 NO.10 OCTOBER 2021

CELEBRATING LOVE Commitment, engagement or otherwise: Meaningful jewelry for every relationship V EGA S R E P OR T

R E F L ECT I O N S

S T YLE

G EMS TONE

BOOMING BUSINESS AT THE SHOWS REVEALED AN INDUSTRY EAGER FOR A COMEBACK

THE WONDERFUL WORLD OF FANCIES IS TAKING BRIDAL BEYOND THE CLASSIC ROUND

IF YOU’RE NOT STOCKING MEN’S JEWELRY YET, YOU’RE MISSING OUT ON A KEY CLIENTELE

PEARLS, BE THEY CULTURED OR NATURAL, ARE CAPTURING COLLECTORS’ IMAGINATIONS

CONTENTS VOL. 44 NO. 10 OCTOBER 2021

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IN-DEPTH

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1 0 N E WS Key stories and stats.

1 5 T EC HNOLO GY Cryptocurrencies have the potential to boost the diamond trade, but risks abound.

1 8 J CK REP ORT Vendors at the Vegas shows were pleasantly surprised by the generous volume — and value — of their sales.

2 0 R A PAP ORT C ONF ERENCES

2 2 R E FL ECTI ONS Fancy shapes are gracing famous fingers and giving rounds a run for their money.

COVER 2 6 T H E B RI DAL I SSU E What the numbers say about modern love; how retailers can stay relevant as social justice movements, generational shifts and Covid-19 change the wedding market; a look at designers offering unconventional rings.

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R E TA I L 56 RETAIL PR O FIL E At her Los Angeles boutique, Logan Hollowell designs jewelry to empower the goddess in every woman.

58 R ETAIL INS IG HT Marketers must learn how to speak to a gender-fluid audience as the line between male and female becomes increasingly blurred.

STYLE & DESIGN

26 70 L EGACY

Gems in a rainbow of hues are starring as center stones in today’s proposals.

More couples are saying “I do” with vintage and antique engagement rings.

Three jewelers share their insights and tips.

64 S T YL E

73 ESTATE J EW EL S

Men’s jewelry is a hot trend thanks to celebrities and social media, inspiring collections by the likes of David Yurman, Suzanne Kalan and Stephen Webster.

Charms from eras past are a popular way to personalize one’s style, says Pennsylvaniabased dealer Annette Brandt.

62 JEWEL RY C O NNO IS SEU R

68 D ES IGNER Erika Winters’s creations evoke the romance of bygone ages and have earned enthusiastic accolades from her peers.

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MARKETS & PRICING 41 PRICE LIST 47 RAPNET PRICE LIST 5 0 D I A M O N D D ATA 53 TRADE REPORT 54 US REPORTS

75 C O L O RED GEMSTO N E Whether it’s akoyas, Tahitians or irregular shapes, there’s a prevailing passion for pearls as stars, influencers and daring designers whip up demand.

80 DIRECTORY 82 CALENDAR 84 THE FINAL CUT

IMAGES: ERSTWHILE; WILLOW DIAMONDS; SHAHLA KARIMI. ON THE COVER: BILL DIODATO/GALLERY STOCK

The state of the diamond industry, the lessons of the pandemic, and the need to end atrocities at Marange were among the topics at Rapaport’s Las Vegas events.

NOTE F R O M TH E PU B LI SH E R LOV E

I Martin Rapaport PUBLISHER M ARTI N @RA PA P ORT.COM

believe in love. Unconditional emotional love that transcends a transactional relationship. A type of love where you want to give something extra special, important and valuable to the love of your life.

The bridal gift is not just a tradition, it is a relationship builder that provides emotional and financial security. The gift of the diamond ring is the gift of commitment. The value of a wedding ring is not measured in grams of gold, but in sacred memories.

Surely the rings and their designs are important. But what is more important is the symbolic emotional value of the gift. The idea behind the jewelry is more important than the jewelry. The dreams and delight of the customer are the real things that we are selling. A person receiving an engagement ring is not just getting a ring, they are getting a life partner.

Our trade creates products that capture the gift of love. The finest, truest and most valuable of emotions are embedded in our jewelry. We are blessed with the opportunity to create happiness.

I believe in love and everything that it means to those fortunate enough to experience it.

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REFLECTIONS

22 OCTOBER 2021

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Feeling fancy Pears, princesses and other diamond shapes are gracing famous fingers and giving rounds a run for their money on the market. What makes them so appealing?

BY JOSHUA FREEDMAN

IMAGES: DEBBI WONG/SHUTTERSTOCK; PAUL MARRIOTT/ALAMY STOCK PHOTO

W

hat connects the Meghan Markle in engagements of actress December 2017.

Meghan Markle, model Opposite: Close-up of Emily Ratajkowski’s Emily Ratajkowski and engagement ring in singer Ariana Grande?

July 2018.

One answer lies in the rings they received: All three featured fancy-cut diamonds.

The UK’s Prince Harry gave Markle a cushion-shaped center stone when he proposed in 2017, while Ratajkowski showed off both a princess and a pear cut in 2018. Grande’s 2020 betrothal gift contained a large oval-shaped diamond next to a pearl.

It’s impossible to say whether the celebrities kicked off a trend or merely reflected one, but what’s certain is that fancy shapes have mushroomed in popularity in the past few years. The category is capturing more and more of the US bridal market, according to dealers.

Wholesale prices have grown, with the RapNet Diamond Index (RAPI™) for 1-carat pear shapes rising 11% for the 12 months that ended September 1. The index for princess cuts increased 7%.

And while the RAPI for 1-carat rounds climbed by a more impressive 18% for those same 12 months as retail spending rebounded, “WHAT YOU’RE the growth in fancies was not purely a case of riding the SEEING NOW broader industry wave.

IS PRICE Fancies have swept the APPRECIATION, floor with rounds in the smaller sizes: The 0.30BECAUSE IF YOU carat index leaped 16% WANT AN XX OR [THE for pears and 10% for princesses during the BEST] RATIO FOR AN period, compared with flat OVAL, YOU HAVE TO prices for rounds. In the PAY FOR IT” 0.50-carat category, prices ▶ DIAMONDS.NET

OCTOBER 2021 23

REFLECTIONS

for pears soared 21%, princesses surged 18%, and rounds went up by a mere 5%.

SUPPLY SHORTAGES The gap between rounds and fancies opened up mainly in the last four months, especially for pears. This has a lot to do with the trajectory of the post-pandemic recovery, says Nir Goldman, sales director at Israel-headquartered dealer Avlas Diamonds.

Initially, demand for rounds jumped after the 2020 Covid-19 crisis, prompting manufacturers to focus on that category in hopes of capitalizing on high polished prices, he explains. Fancies have since caught up, but supply is low because cutters weren’t producing them.

This, in turn, is pushing prices up, but the market has yet to reach “an equilibrium that will cause a better supply of fancies,” he says.

The leap in demand is partly a result of the US bridal market’s maturity, according to Nilesh Chhabria, chief operating officer at Mumbai-based manufacturer Finestar Jewellery & Diamonds. American brides have long accepted the concept of engagement rings and are now shifting away from round stones in favor of more distinctive options, he says.

“They’ve reached the level where they want to look different,” states Chhabria, citing Grande’s stone as an example of original design. Finestar has upped its focus on fancies in response to the demand, with the category now accounting for around 60% of its production, compared with just 5% in 2015.

SHARPENING THE CUT Fancies also appeal to cost-conscious consumers, as they are cheaper per carat than rounds — largely because they can give the manufacturer a better yield on the rough. In addition, they have a better “spread”: The table looks bigger relative to the carat weight.

While fancies used to be duller than rounds because they possessed fewer facets, says Chhabria, cutters are finetuning the cut quality in an effort to make alternative stones look as beautiful as their round counterparts — a factor that is further boosting appetite.

“To make the diamond shine much better, [manufacturers] had to reinvent 24 OCTOBER 2021

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Ariana Grande sharing her engagement ring on Instagram in December 2020. Opposite: Eva Fehren rings with various fancy-cut diamonds.

themselves,” he explains. “So the manufacturers, over a period of time, found ways to increase the fire and the luster of the diamond.”

For example, customers complained about a “crushed ice” look with some cushion cuts, Chhabria recalls. His company put research-and-development dollars into modifying the shape, resulting in a better make that achieved stronger sales. Other clients said they wanted cushion diamonds to be longer, so Finestar created an elongated version that’s now “being sold like hotcakes,” he reports.

In ovals, a common issue is how to avoid the bow-tie effect — a dark section in the middle of the stone. The company has worked to curb this effect as much as possible by adjusting the cut.

The emergence of large Indian manufacturers has further affected the fancy-cut scene. Smaller companies have had to work with the material at hand,

“THE OPPORTUNITY FOR GROWTH OF FANCIES IN THE FAR EAST PARTICULARLY IS ENORMOUS” HERTZ HASENFELD PRESIDENT, HASENFELD-STEIN

“forcing” their desired shapes into the rough, Chhabria explains. However, larger companies that buy rough in high volumes have the luxury of determining the ideal polished for a given stone.

“Nowadays, you can see many, many more flawlesses in the [fancies] market, which was rare, say, five, 10 years ago,” says Goldman, whose company specializes in fancy shapes of F color and VS clarity or better. “And you can see much more XXs” — the term for diamonds with an “excellent” score for both polish and symmetry.

SPECIFIC DEMANDS

IMAGES: ARIANA GRANDE/INSTAGRAM; EVA FEHREN

Jewelers are increasingly giving precise specifications for their fancies, says Hertz Hasenfeld, president of New York-based manufacturer Hasenfeld-Stein, which specializes largely in branded cuts.

Previously, every retailer had clear requirements for the rounds they’d buy, but they tended to choose fancies based on appearance, he explains.

“Now I’m seeing specs [for fancies].

People are realizing that there is a vast difference between a well-made and poorly made [stone]. So what you’re seeing now is price appreciation, because if you want an XX or if you want [the best] ratio for an oval, you have to pay for it.”

This trend has been visible since economic activity resumed last year, he reports. With inventory levels down after the virus-induced slump, jewelers came back eager to restock and ensure they were carrying what clients wanted.

“Together with the reopening of the diamond business came the demand for

ONE ‘X’ SHORT OF PERFECT

“TO MAKE THE DIAMOND SHINE MUCH BETTER, [MANUFACTURERS] HAD TO REINVENT THEMSELVES” NILESH CHHABRIA COO, FINESTAR JEWELLERY

nicer fancies,” he says, noting especially strong appetite for cushions, ovals and princesses.

SPREADING TO CHINA The next step for growth is in Asia, where the overwhelming preference is still for rounds. That contrasts with the US, where dealers estimate that fancies constitute around half of the bridal market.

“There’s going to be [more] awareness about fancies [in the Far East] because the Chinese have always seen Americans as their role models,” says Digesh Shroff, senior sales executive at Indian manufacturer Venus Jewel. Non-rounds represent some 65% to 70% of Venus’s total output; at most companies, it’s roughly the opposite.

“So whatever happens in America first, sooner or later we see China also adopting the same,” Shroff asserts.

This presents significant prospects for dealers, according to Hasenfeld.

“There’s a tremendous amount of white space there, ready to be occupied by good fancies. It’s slowly, slowly starting to come in there. I’m starting to sell cushions [and] princess cuts in the Far East. I think the opportunity for growth of fancies in the Far East particularly is enormous.” ◼

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ith fancy-shape demand growing and manufacturers working to make their stones look shinier, one challenge stands out: The Gemological Institute of America (GIA) won’t award them a cut grade. Fancies can get a score for polish and symmetry, but the triple-Ex benchmark is only for round brilliants.

While this makes it hard to identify the very best stones, the GIA’s stance is almost inevitable given how subjective the task can be and the lack of consistency across the trade.

“There is a need [for a cut grade], because everyone wants to know the difference between a good cut and an excellent cut,” says Nilesh Chhabria of Finestar Jewellery & Diamonds. “But the only problem is that the cut of fancy shapes over a period of time is just getting improvised regularly. And there are so many complications defining what is a good cut.”

The GIA says it has been working on how to quantify and measure cut quality and attractiveness for a while. However, devising a grading system is “several orders of magnitude more difficult” than for rounds, a spokesperson explains. While there are 38.5 million possible combinations of measurable characteristics that contribute to the cut grade of round brilliant diamonds, the GIA has identified more than 14 billion for fancies so far.

Alternatives such as lightperformance scores and in-house grading have helped distinguish between diamonds, notes Devansh Rajesh Shah, a partner at Venus Jewel. And the American Gem Society (AGS) does offer a cut grade for fancies — but it’s in the minority, and will likely remain so for the time being.

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COVER

THE NEW FACE OF

NUPTIALS

With the pandemic, social justice movements and generational shifts changing the bridal market, retailers have to keep up if they want to stay relevant.

IMAGE: BILL DIODATO/STOCK GALLERY

T

BY L AR A E WE N he past few years have brought about extraordinary changes to the wedding and engagement jewelry industry. In addition to the Covid-19 pandemic, there have been significant social and political shifts, leading to both shortand long-term differences in the way retailers do business.

The l a stin g ef f ec ts o f the c o ro n avi rus For Ken Black, Covid-19 caused a boom in bridal sales. “When it looked like the world was coming to an end, customers started looking at relationships more seriously and moving faster,” says Black, who co-owns Philadelphia Diamond Co. in Philadelphia, Pennsylvania, with his wife Nicole. “People were getting engaged, and people who were married for a while were doing upgrades.

Travel expenses trickled down, and the malls were closed, and the big box stores couldn’t get employees in. So smaller stores thrived.”

The pandemic’s impact on consumer sentiment also led to bigger buys, says Ben Smithee, CEO of consumer consultancy The Smithee Group.

“For bridal and engagement, we’ve seen larger purchases due to lack of opportunities [to spend] disposable income.”

Jenny Chung Seeger affirms this trend.

The founder and owner of No. 3 Fine Jewelry in San Francisco, California, notes that her customers’ engagement ring budgets increased by approximately 10% over the past year.

Furthermore, the pandemic has impacted the channels people use to shop. “We see stores selling more of what they promote online,” says Smithee.

“Marketing and advertising works. The amount of content people are consuming online is exponential, especially during Covid-19 — Instagram, second

screening, TikTok, blogs. When you consume more content, it leads to an increase in purchases.”

Bigger budgets have led to more demanding clients, says Lisa Krikawa, CEO of Krikawa Custom Jewelers in Tucson, Arizona. “Every time there’s an economic shift, people want things their way.

Money became so important during Covid-19, and if customers are going to spend it on something luxury, they want it to be money well spent. So by driving that process, they give that process meaning. They want it their way, and they’ll even put aside aesthetics.”

M a k i n g a s tat e m e n t There has also been a new wave of political change and upheaval, and some retailers have used digital engagement to take a social stand.

“We’re vocal on social media,” says Chung Seeger. “We’re a female-owned and minority-owned business, and we’re sad about abortions being illegal, and we talk about Black Lives Matter.”

Being an independent business has helped her implement changes more easily than larger brands might. “We’re so much more nimble and flexible,” she says.

“We can mandate masks, whether the city requires them or not. We don’t have to approach a board to talk about [issues]. Small stores can do that, and they should flex that when they can. Larger stores have [more] people that they answer to, and that’s where things get messy.”

Krikawa agrees. “We can turn on a dime,” she declares. “We can have a huge impact on our ▶

“THE AMOUNT OF CONTENT PEOPLE ARE CONSUMING ONLINE IS EXPONENTIAL.... WHEN YOU CONSUME MORE CONTENT, IT LEADS TO AN INCREASE IN PURCHASES”

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OCTOBER 2021 29

social media. I can change how things are done in a day. Bigger companies can’t do that. They’re too heavy and rooted.”

Customers are drawn to stores that align with their values, retailers say.

“Separating out racial justice, we very rarely get into pure politics,” comments Nicole Black. “But in terms of people looking for Black-owned businesses, [there’s been] a positive impact on our business.

We’ve always had a very diverse clientele. But now people are speaking out and saying they want to look for Black-owned businesses, and on Instagram they’re curating lists and tagging us. It’s not just African Americans. It’s across the board. People are seeking to spend their dollars more consciously.”

In fact, adds her husband, 40,000 people search Google for “Black-owned jewelers” in his area each month. “It’s a popular search.”

Div er sit y an d equit y Consumers are paying more attention to social issues, according to Chung Seeger. “Black Lives Matter amplified a lot of voices,” she says. “The 30 OCTOBER 2021

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more people who talk about it, the more people listen and want to talk about it. And Covid-19 [meant] we had a lot of time to sit with it.”

Yet she says the diamond industry has fallen short in terms of diversity.

“The diamond industry is maledominated. You walk into the diamond district as a young Asian female, and they want to charge you more. It needs to be overhauled and modernized, but there’s so much work to do.”

She believes the industry needs a more sincere commitment to change.

“It’s about putting diverse people in your Instagram feed and supporting designers who represent diversity, and hiring people in the communities that you’re targeting and marketing to,” she says — though she cautions that it can’t be just about visuals. “It’s all about authenticity. Until a business that only employs white, cis employees adds diversity to its staff and its designers and its diamond vendors, then it’s all one big closed circle.”

Black agrees that making statements isn’t enough.

“The Washington Post did a story revisiting corporate America’s pledge [to increase diversity], and it really hasn’t panned out,” she comments.

“C-suites and corporate-owned chains are not diverse at all, and independent stores are family-owned and generational, which also comes with some biases. The jewelry industry has done a poor job and hasn’t been encouraged to do better.”

Diversity in marketing can also backfire, she adds, if consumers sense it’s only being used as a selling tool. “You can tell that LVMH has done quite a bit to incorporate people of color, at the C-suite level as well, and they tapped Beyoncé and Jay-Z [for a recent Tiffany & Co. ad]. But I don’t know how well it’s played. Some people celebrated it, and some did not, because the brand didn’t seem authentic, and it seemed like they were using this as a marketing ploy.”

Krikawa echoes that sentiment: “If a company is scrambling to [make a statement] right now, then that’s not good.”

She, too, suggests that brands struggling with diversity start by looking at the makeup of their own staff. Her own company has “a diverse employee base and a diverse customer base. My business partner is Black and a woman, and my staff members are LGBTQ+.”

Still, she says, there’s a long way to go. “When the industry stops being prejudiced, then we’ve done enough.”

IMAGES: KATKIM; TOMAS DONOCIK; STEPHEN WEBSTER

IMAGES: BILL DIODATO/STOCK GALLERY

LGBTQ+ c o u p le s Equity in wedding and engagement jewelry also means serving same-sex, transgender and nonbinary clients.

“How often are we posting images of same-sex couples?” asks Chung Seeger. “How much are we excited for them? How much are we scared we’re going to turn away cis couples? LGBTQ+ couples may know they’re welcome, but you have to talk about them. It’s not just putting a sticker in your window. You have to really believe it, and it has to come from a place of authenticity.”

“NOW PEOPLE ARE SPEAKING OUT AND SAYING THEY WANT TO LOOK FOR BLACKOWNED BUSINESSES, AND ON INSTAGRAM THEY’RE CURATING LISTS AND TAGGING US”

One way to make the experience more welcoming is to change the language, suggests Smithee. “One easy step is, let’s stop calling it bridal, and let’s call it ‘engagement.’ If a gay man is getting engaged to another gay man, he’s probably not calling him his bride. ‘Bridal’ is an industry term, but they’re engagement rings. It matters. If I were not a straight man, the word ‘bridal’ would not speak to me.”

W h at ’ s n e x t ?

While Black sees change coming, she doesn’t see it coming quickly. “Gen Y and Gen Z go where their parents go,” she observes. “This is still an institution driven by trust. There’s a certain level of consciousness, but I don’t think it’s changed a whole generation.”

She says she still experiences a lot of bias. “I didn’t go to JCK [Las Vegas] this year, but when I go, what I find is that there’s a stereotype and a bias.

[Vendors] say, ‘This is great for your clientele,’ and ‘bling bling,’ and they make assumptions. Jewelers try to market that way, and they’re unbelievably offensive. They have no one on their staff who knows the community. They only want to talk to African American customers when they have ‘no credit down.’ They assume the higher-end clientele is a white, straight man. But our store targets a psychographic, not a demographic, and that cuts across all races and all lines: doctors, nurses, engineers.”

Chung Seeger says business owners need to speak to the communities they serve. “You’re making money off your community. So how are you contributing? It’s about who you’re sourcing and who your suppliers are. It’s about how important the younger generation of shopper is to you.

Remember that you’re not just selling rings, you’re selling a business ethos.”

Businesses that don’t reflect diverse populations risk becoming obsolete, warns Smithee. “The racial-injustice calls from last year caused some people to increase diversity in their media, but largely, that hasn’t been the case. [So] diversify your marketing. Make the effort to have a diverse team. Show variable skin tones on your website. For the next generation of consumers, it matters. It’s inconvenient to do a new photo shoot and hire five models instead of two, but it’s also inconvenient to go out of business because you’re not relevant.”

Black believes that a better understanding of the industry’s makeup could help. “This industry is lacking data,” she says. “How many African American jewelers are there? How many firstgeneration jewelers are there? Those stats don’t exist. That kind of large quantitative survey is important. There are real statistics out there, and sometimes statistics can drive action and change.” ◼ DIAMONDS.NET

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THE FINAL CUT

PROPOSALS THAT POP A look at some of the most famous colored-diamond engagement rings that celebrities have sported over the past 20 years.

BY LEAH MEIROVICH

Heidi Klum Singer Seal asked supermodel, Project Runway host and America’s Got Talent judge Heidi Klum to marry him on a romantic Canadian ski getaway back in 2004, proffering a beautiful ring with an oval-shaped, 10-carat, canary-yellow diamond. The stone was cut specifically for Klum’s finger to ensure it looked perfect on her hand. Jeweler Lorraine Schwartz designed the ring, which has an estimated value of around $150,000.

AWAS H

with color In our latest special supplement, sponsored by Langerman Diamonds, we explore the extraordinarily rich universe of colored diamonds — from the science that makes them rare occurrences in nature to the cuts that turn an enticing rough into true sparkler. We also look at how to convey the diamonds’ distinct beauty beyond the mainstream grading system and meet designers who create works of art out of these vivid gems. A must-read educational tool, the supplement is available with this month’s magazine and online at diamonds.net/magazine/ specialsupplements.aspx

Jennifer Lopez Jennifer Lopez and Ben Affleck recently reignited their romance after first dating in the early 2000s. In 2002, Affleck popped the question with an emeraldcut, 6.1-carat, pink diamond ring by Harry Winston. Flanking the center stone are two smaller emerald-cut, white diamonds. The ring is reportedly worth approximately $1.2 million.

Kristen Bell Veronica Mars and Disney actress Kristen Bell announced her engagement to actor and comedian Dax Shepard in 2010. She first debuted the emerald-cut, 3-carat, cognac-brown diamond on the red carpet at the Grammy Awards. The ring, created by famed jeweler Neil Lane, has a row of small white diamonds on either side of the center stone.

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Clockwise from top: Ben Affleck and Jennifer Lopez in 2003; Heidi Klum’s engagement ring in 2005; ring with a pear-shaped, 4.50-carat, fancy-pink diamond surrounded by a pavé of matching melee from Langerman Diamonds; Scarlett Johansson in 2020.

IMAGES: A BERLINER/​BEI/​SHUTTERSTOCK; MARION CURTIS/​STARPIX/​SHUTTERSTOCK; LANGERMAN DIAMONDS; PAUL SMITH/FEATUREFLASH

Scarlett Johansson When actress Scarlett Johansson got engaged for the third time, she hit the jackpot with her ring. Comedian Colin Jost proposed in 2019 with a pear-shaped, 11-carat, light-brown, type IIa diamond atop a thin, curved, black ceramic band. The piece, which is believed to be the design of Taffin’s James de Givenchy, is estimated at approximately $400,000.