DeBeers is one of the marketing giants of our time (what other company could literally install their product into a life-changing ritual).

On the other hand, it’s no exaggeration to say that they seem to have lost their moral compass along the way. It was once true that DeBeer’s executives could not set foot on US soil since the company had basically fled the justice system there (anyone know if that is still true)?

Interestingly enough, I also believe their participation in the Kimberly Process is far from alturistic either. It’s simply another attempt to do what they’ve done all along, lock up the distribution channel in monopoly fashion. This from a company that’s long practiced “cleaning” their diamonds via a dilution process that makes diamonds untracable to their questionable sources.

I think I can describe DeBeer’s in two words:

Evil Genius

We swear Ben works for us and not DeBeers.

Being Open: I think De Beers is more open than it has been in the past, but a lot of it has been tooting its own horn. I skimmed through the 140 page “Report To Stakeholders”, and it didn’t mention the volume of diamonds stored or released to market. Their portfolio of statements didn’t include the standard financial statements either. However, as a private company, this is their right. Regardless, making a 140 page document that talks about targets and goals free to the public is certainly a sign of opening up.

Sharing: Part of them being open is publicizing new initiatives like this. Not hiring enough Africans to do things beyond mining activity was a major public complaint about the company.

Overall – Currently, there isn’t a true impetus for a more open/collaborative strategy. At this point, they seem to be using it more as a marketing opportunity. Changing the conflict diamond negative publicity into “Saving Africa”. If anything does propel them to take a chance by becoming even more open, it would be if they ran out of supply, or didn’t have enough supply to control prices. Since demand is poised to outgrow supply significantly, this may attract new players to the market that may find new mines around the world. This could greatly decrease De Beers’ influence.

I think the De Beers marketing department over time has done enough to stop the threat of synthetic diamonds. A diamond’s value isn’t its beauty, it is what it represents to your partner.

I would love to do a more in depth analysis in the future. Perhaps a follow-up post in the future.

A couple of questions regarding your post (organized by section)

Being Open – You note that since 2006 they’ve become more open and transparent – how so? Have they release info on the volume of diamonds stored vs. released to market?

Sharing – An important new initiative run in Botswana sees all sorting and some cutting/polishing of diamonds done in country, creating an additional 3000 jobs over and above mining activity.

Overall – What will be the competitive impetus for a more open/collaborative strategy? Will it be new finds by other diamond co’s or a consumer shift towards synthetic diamonds?

And finally, how exactly are they migrating to become a Next Gen Enterprise? Would be very interesting to see a deeper analysis to see if this was in fact true.

Cheers, DH.