Ad agency copywriters are among the most creative writers on earth, and their ability to play on words is often mind-boggling. Those writers may, however, be less familiar with laws and ethics in the diamond industry. These thoughts occurred to me while reviewing the website of one of the world’s most prominent suppliers of synthetic diamonds for industrial uses. This website said, among other things, “We believe that luxury and functionality are a perfect marriage. In jewelry, diamonds have always had an exclusive ring to them, but what about a diamond glass or a diamond wheel to truly complete the upscale image of a luxury watch? These enhancements do not only add exclusivity, but are an actual improvement to the quality of even high-end watches. Many of the more exclusive watches now have a glass of highly scratch-resistant sapphire crystals. Nice, but not nearly as good as truly scratch-resistant diamond.”

            Each and every reference in this marketing pitch, from diamonds, to diamond glass, or scratch-resistant diamonds is a reference to synthetics diamonds!

            The copywriters made rather ingenious use of the usual expressions associated with natural diamonds to sell these synthetics. For example, “luxury,” “perfect marriage,” “exclusive ring,” “upscale image of luxury watch,” and “exclusivity” are all buzz words that raise “diamond emotions,” which promote the sale of man-made industrial (synthetic) diamonds to the watch industry. The copywriters never used the mandatory qualifier before the word “diamond.”

            What is of particular interest is that this industrial synthetic diamond producer is also involved in the development of consumer products. Says the website, “Our ‘Consumer Innovations’ are diamond components for consumer goods. Products with diamond components will benefit from the appeal factor of diamond and the actual quality and lifetime of the product will improve. We like to call this: functional luxury.”

            These diamond components do, largely, refer to synthetic diamonds.   Ostensibly, this appeared as a gross violation of De Beers Diamond Best Practice Principles, of the U.S. Federal Trade Commission rules, of the CIBJO Diamond Book, of the CRJP’s Code of Best Practices, and another half a dozen codes or rules.

            A few e-mail inquiries confirmed that my hunch was correct and that, in this specific instance, the unfortunate wording was merely the product of an overzealous copywriter. The misleading and deceptive text disappeared last night from the Internet. Anyone trying to find it will get an “error” notice – and it will probably take some time for the new text to be approved by the company’s executives and lawyers. No need to identify the company: management acted responsibly, correctly, and honorably. It underscored that even mammoth-size industrial organizations can act swiftly and decisively.

            The story (or rather the now non-story) raises questions that go far beyond a creative error of copywriting. The diamond industry’s professional trade organizations have been engaged in the past year in an intense debate on the wording applied to synthetics (man-made, laboratory-grown, etc.); we have been actively counting how many times the word “synthetics” will appear on the GIA synthetic diamond grading report. (The answer is that it will appear twice on the inside of the report and not on the outside.) The industry is not addressing, however, the increasing use of synthetic diamonds in non-jewelry products – in places where there is absolutely no legal requirement to disclose!

            There are instances where the industry can keep its members in line. But our ethics and escalating concern with consumer confidence do not move in the same direction as legislators, who increasingly rely on free competitive market forces and are keen to minimize the regulation of marketing terminology. In the United States, the jewelry industry should consider itself lucky to still have the Federal Trade Commission (FTC) Jewelry Guides. In the past decade, many FTC industry guides have been abolished, though general rules prohibiting deceptive and misleading marketing practice apply to all merchandise.

            In 1996, the FTC queried whether there was still a reason to keep the Jewelry Guides. Out of a few hundred stakeholder submissions, all but one agreed that there was, in fact, a continuing need; most stated that “the Guides protect consumers and industry.” One organization declared that “without the guides to serve as a reference manual, every manufacturer or producer would have their own interpretation [of what constitutes fair industry practices].”

            In an environment of “de-regulation” one may find that, for example, if Rolex would market (in Europe) a diamond watch containing 10 carats of high-quality stones, it is not clear at all whether there is a legal imperative for Rolex to disclose the fact that these stones are synthetics, if, indeed, they were synthetics. (Anyone complaining will be faced with issues such as establishing the “economic harm” caused by the non-disclosure, which isn’t so simple.)

Synthetic Industrial Diamonds are Used for Consumer Goods

            The copywriter’s mistake should make us pause, and we should take a look at the marketing of industrial man-made diamonds. We have somehow always felt that this has nothing to do with the jewelry industry. That may have been true in the past; it is less true today, and may not be true at all tomorrow.

            And this raises a series of new issues. The FTC rules do not make any distinction in whether the marketing is to intermediaries or to the consumer. Sumitomo, De Beers, Gemesis, Apollo, Chatham, and other industrial and gem-quality synthetic manufacturers sell or appeal to the trade, to intermediaries and to consumers.

            Let me give a concrete example: De Beers’ industrial diamond subsidiary, Element Six, markets hi-fi “speaker domes.” Says the company’s marketing materials, “Diamond being stiff and yet light makes it an excellent acoustic material. Especially in a tweeter, where the desired properties for perfect sound are the lightness to move rapidly as a piston and the stiffness to retain shape. Diamond’s unrivalled stiffness allows it to behave closely to the theoretical ideal of a perfectly stiff tweeter acoustic diaphragm. Where other materials distort at higher frequencies, a diamond tweeter dome returns a true reproduction of sound up to a high-frequency of at least 70 kHz, which is three times beyond normal human audible range. The result is a clear and transparent sound, which comes close as possible to the sensation of actually being present at the performance.”

            We assume for a moment that the reference to diamond is to a synthetic diamond (over 98 percent of industrial-diamond uses are synthetics), but we don’t know that for a fact. (In the U.S. alone, industrial synthetics production in 2005 was over 250 million carats and some 300 million carats were imported. Worldwide, synthetic diamond production for industrial uses must be well over a billion carats a year; earlier this year, De Beers inaugurated a new plant in China, which will also be able to produce 300 million carats a year.)

            But a question that must be asked is when hi-fi sound systems proudly note that they contain diamonds – is that any different from the diamond on your pen, the diamond “glass” crystal on your watch, or the diamond on your wallet? I even thought about the growing number of lingerie companies selling diamond bras for the woman who has everything – is there any legal reason for them to disclose that these diamonds are synthetics, if they are? And, if they do not disclose that fact, is there anything we can or should do about it? Or, maybe, it does not affect us?

Is Disclosure a Function of Use by End-User?

            When we talk about non-jewelry uses, at what point must the supplier disclose the “S” word (Synthetics) on its marketing materials? Industrial synthetics will become an issue – and, maybe, they have already.

            The confusion is also visible at a website of Element Six, which sells CVD synthetic diamonds – the same technology that Apollo Diamonds uses. As previously mentioned, Element Six is the research and marketing arm of the De Beers industrial and synthetic diamonds. Its Chairman is Nicky Oppenheimer's son Jonathan. The company, under a different name, was established in 1946 by the late Sir Ernest Oppenheimer. It is truly a family affair since Jonathan’s wife, Jennifer, recently opened the company’s new synthetic diamond plant in Suzhou, China.

            The Element Six marketing website mentions the term “CVD Diamond” many times. In the jewelry industry, CVD is not a permissible qualifier before the word “diamond.” De Beers will probably say that its CVD applications are solely for industrial uses and that none of the guidelines would apply.

             But if that argument would be made, I might say it is strange that requirements or guidelines for qualifiers are or can vary depending on the product’s usage. 

            It may be okay for De Beers to sell CVD diamonds – assuming the company knows that the diamonds will not end up in jewelry use. Otherwise they need a qualifier before the word diamonds.

            That reminds me of a few years ago, when De Beers sold hourglasses (sand clocks) containing 2000 polished natural diamonds.  If someone wants to order 100,000 Apollo diamonds for the manufacturing of sand clocks, is there any reason they cannot be marketed as true diamond clocks? Do we need the “S” word?

Value versus Non-Value

            The difference (gem vs. industrial) is that of degree rather than kind – a diamond is still a diamond regardless of how you use it; plus you can’t dilute diamonds like you can with metals such as gold. 

            One might argue, in the context of naturally mined diamonds, that the qualifier and disclosure is critical because of the material’s value, which is significantly lower for diamonds that are usually used or classified as industrial. The problem with this argument is that it has a huge gaping flaw.

            The onus of properly describing the product is on the seller, correct? This argument, then, only requires the so-called permissible qualifiers if the seller is selling the product for (jewelry) applications defined by FTC, CIBJO, etc.

            If the likes of De Beers, Gemesis, Apollo, or Chatham (Chatham also resells synthetic diamonds sourced in Japan) sell man-made diamonds without making any reference to how their products might be used, are they exempt from the various published guidelines for the gem and jewelry industry? 

            Purchasers can then do whatever they wish with the diamond, including putting it in jewelry, but that is the purchasers’ choice and prerogative. Is there a separate set of guidelines for diamonds for industrial applications? If there is, is there merit in having two sets of guidelines?          

Our Groundbreaking Diamond Dome Tweeter

            These guidelines exist for the protection of consumers, so it might be said that industrial applications are not subject to the same guidelines.

            The website of the De Beers Element Six industrial diamond subsidiary contains a category called “Consumer Innovations.” It includes loudspeakers as well as a link to the website of Bowers and Wilkins hi-fi equipment. Clicking through to that website, a whole product range is offered to the consumers. The teasers to the products include the following: “With an impressive list of advanced technologies, including our groundbreaking diamond dome tweeter, and a comprehensive model range to suit a wide variety of applications, the 800 Series sets the benchmark in high-end audio.” Interested consumers can then simply give their zip code in any country in the world to get the name of the nearest local dealer. This is direct consumer marketing of a luxury product.

            Is the selling of hi-fi equipment containing diamonds all right, even if they are – or might be – entirely synthetic diamonds? This is not something that the industry has considered in any forum – at least not to my knowledge. What is the difference between the hi-fi equipment and a diamond face of watches? Is the difference of legal nature, ethical nature, or is this all wholly irrelevant?

Nozzles for the Consumer Market

            Let us not kid ourselves. It has become clear that Element Six will never hesitate to use the word “diamond” and the emotions associated with it to convince consumers to purchase products containing a synthetic diamond component. It will not use the “S” word.

            You decide for yourself while I give one last example: Long Life Aqua Nozzles for the consumer market! Says Element Six, “Imagine what the appeal and quality of diamond can do for marketing consumer products. An espresso machine or high pressure water jet cleaner with a touch of diamond? Element Six can make it happen. A Long Life Nozzle will not only improve the quality image, it will actually extend the lifetime of the product and create satisfied customers.”

            The whole issue about using the treasured emotions and value of diamonds for the marketing of non-jewelry synthetic diamond products may only be at its infancy. Just imagine that Apollo or De Beers will market tomorrow a diamond frame for optical glasses – so that film stars and other publicity-seeking, wealthy individuals can proudly say that they are wearing a multi-million dollar diamond frame. Maybe that helps the image of diamonds – but nozzles? You tell me…

            Have a nice weekend.