181–190 of 239 posts
The Oppenheimers have sold their entire stake in DeBeers - they've cashed out. They went from producing 80% of the global market (in the 90's) to 35%; clearly, the writing is on the wall, and without strong centralized vertical management, the diamond market will collapse.
Time to short diamonds.
The Russians just announced that they have a huge amount of quality diamonds on their territory in some site that they haven't started exploiting yet. To profit they basically have to ape De Beers and create a huge demand in Europe or Asia (I think diamond engagement rings are that big only in the USA)
Still they are expensive and luxur-ish. I guess Russian jewelers are just riding the world-wide hype wave, not interested in disrupting or "harming" the market.
Earlier quoted context omitted.
The trick is to turn a less luxurious good into a luxury good. Which is rather like what they did. Cars are an area where this is really common. BMW doesn't bring their lower end stuff into the US. Toyota created Lexus to be a luxury brand. Or there's the pricier sorts of bottled water...
Check out the Nike Air Force 1 High Premium iD Shoe. $200 a pair. "It's a limited-time opportunity to create an inconceivably rare sneaker. Each month, Nike is releasing a new, exclusive material option for the Nike Air Force 1 High Premium iD. A limited number of pairs is available to customize each month, so get one while you can."
I'd say that $200 is approximately the right markup compared to the regular price of an Air Force considering what's required for individual customization. I do note that the price of a shoe may be high to begin with.
That being said, they've stepped it up beyond your example and gone with "Bespoke" options for their shoes. $800 a pair.
Wow, absolutely brilliant. I can't believe this article popped up on HN's front page tonight. I just got back from looking at engagement rings with my girlfriend. I've known about this monopoly for a while, and so has she. Heck, one of the first movies we watched together when we first started dating 7 years ago was Blood Diamond. Here's the conversation we had while in the jewellery store tonight. Me: "Sweety, I rea…
I recently purchased a diamond engagement ring for my fiance. That shopping experience perfectly encapsulated everything there is that I could possibly hate about making a consumer purchase: 1)Product is monopolistic, with supply artificially constrained in order to generate prices that reflect that. Actual value of say, a one carat diamond, is probably a few hundred bucks max. 2)Cultural demand was artificially craf…
Earlier quoted context omitted.
The trick is to turn a less luxurious good into a luxury good. Which is rather like what they did. Cars are an area where this is really common. BMW doesn't bring their lower end stuff into the US. Toyota created Lexus to be a luxury brand. Or there's the pricier sorts of bottled water...
Or "super-premium" vodka. That's an entire product that didn't even exist until someone decided to create it, largely as a way for people to demonstrate to others that they're well-off enough to purchase super-premium vodka. If you can get yourself into a "value through market position" opportunity early on, it seems like a license to print money.
Earlier quoted context omitted.
She even told you her true requirement, which is to look good for her girlfriends. (Watch what happens when ladies announce an engagement or look for the ring shot on Facebook, then tell me I'm off base.) You did not sell her a product which would make her the envy of her girlfriends. "Cheaper than their rings" is the opposite of a victory condition. Don't sell cheap. Sell authentic, sell natural, sell one-of-a-kind,…
P.S. If you understand the thing she is trying to buy, you don't have to sell her a ring at all. There turns out to be an arbitrage opportunity in social status for, say, middle or upper-middle class Japanese women. Anybody can buy rocks, but nobody can buy a man vacation, so a man who demonstrates ability to take long vacations must be able to buy virtually unlimited amounts of rocks. Regardless of whether I can aff…
My wife wears a moissanite ring, which she loves. The deciding factor was that we could afford a unique custom-designed setting if we went with moissanite. The same ring with diamonds would have been more expensive by at least a factor of ten.
My wife worked in high-end bridal in NYC for a few years, and rings were always a topic of conversation. The amount of times prospects noticed the stones in her ring were moissanite: zero. The setting sends a stronger signal, and it's less expensive. To echo patio, people who saw the ring assumed I was unreasonably well off, when the true total price was less than the latest MacBook.
Paying up for "perfect" diamonds is a complete waste of money from a signaling standpoint. Spend on the setting and design, not the stones.
Wow, absolutely brilliant. I can't believe this article popped up on HN's front page tonight. I just got back from looking at engagement rings with my girlfriend. I've known about this monopoly for a while, and so has she. Heck, one of the first movies we watched together when we first started dating 7 years ago was Blood Diamond. Here's the conversation we had while in the jewellery store tonight. Me: "Sweety, I rea…
> De Beers has probably pulled off the greatest marketing stunt in the history of humanity. The fact that it's so ingrained in our minds, to the point where a smart, educated, and informed person like my girlfriend still wants a diamond even after knowing all the issues with them, is fascinating. Does she still want the diamond after being shown the article? Most people don't like being manipulated.
We went out for coffee after shopping. She knows I'm right about diamonds. Her issue is a) she has difficulty listening to me about these things because she's stubborn and feels like I'm manipulating her b) she doesn't want to buck the trend, be different, and have to explain things to her friends and family.
She hates being different, and she hates being the centre of attention. She feels that by not getting a diamond engagement ring, others will speak ill of her behind her back, and she doesn't want to stand out like that.
I'm the opposite. I could care less what others think. I don't love being the centre of attention, but I don't mind it. I hate being conformant though.
Anyway, it's not criticism of her. I love her dearly, I just need her to see the light.
Wow, absolutely brilliant. I can't believe this article popped up on HN's front page tonight. I just got back from looking at engagement rings with my girlfriend. I've known about this monopoly for a while, and so has she. Heck, one of the first movies we watched together when we first started dating 7 years ago was Blood Diamond. Here's the conversation we had while in the jewellery store tonight. Me: "Sweety, I rea…
Stick with your guns. Why would you buy a diamond when you're so opposed to it for perfectly valid (although potentially subjective) reasons? Does the perception of other people that you are "too poor to afford a real ring" matter to you so much? My wife was appalled when I told her I refused to buy her a diamond engagement ring. "Why wouldn't you want to give me a diamond ring? I couldn't marry someone who wouldn't…
However, I have to take my girlfriend's feelings into account. I have to buy the ring, but she's the one that has to wear it. If she has ill-feelings towards the ring when she wears it, she'll hate it. I'm not saying that's what'll happen, I'm just saying I need to take her wants and needs into account. Simply making a decision for her because "I know what's best." is selfish.
Anyway, I'm slowly whittling her down. She just told me she may be interested in a sapphire ring.