De Beers is planning to spend more money advertising diamonds than any time in the past decade to win back wealthy shoppers.
The company, a unit of Anglo American Plc, boosted its marketing budget to $140 million this year, the most since 2008, according to a statement on Tuesday. Its three biggest markets, the U.S., China and India, will be the main focus, the company said.
Diamonds face tougher competition as an elite status symbol among millennials as young, rich shoppers spend more cash on high-end electronics, travel and fine dining. While De Beers said spending on diamond jewelry in the past five years was a record, the company is also battling a years-long slump in prices for polished gems.
"We cannot take future growth for granted," said Stephen Lussier, head of marketing at De Beers. "Increasing our spend from a strong position will help support continued demand in both mature and developing markets, particularly among millennials."
De Beers is trying to rectify a contraction in diamond advertising that followed the collapse of its monopoly in the early 2000s. As the industry splintered, De Beers wasn't willing to pay for promotion that would aid rivals and cut its marketing budget in half to about $100 million a year through the 2000s.
The company will now focus most of its attention on its Forevermark and De Beers Diamond Jewellers brands and also increase contributions to the Diamond Producers Association, a lobbying group that has been trying to raise more money.
The industry is increasingly dependent on the U.S., which accounts for more than half of the world's diamond purchases. The American market rose 4.4 percent to a record $41 billion last year, offsetting contractions in China and India.