The Story of Diamond, De Beers and Love
Created on 14 Feb 2020
Wraps up in 3 Min
Read by 2.6k people
Updated on 10 Sep 2022
Did you make the right decision in purchasing a diamond? How did De Beers Monopoly affect you? Read in this Valentine’s Day Special blog.
You may be excited for Valentine’s day today. It is also possible that you might be thinking of gifting a diamond ring or bracelet or some other diamond accessory to your special one. After all, diamond denotes love, right? But, have you ever thought that how come these hardest stones on earth became a symbol of love? We’ll tell you the complete truth in this Valentine’s Day special edition of our newsletter. Read on.
Diamonds have attracted us for long. We have been conditioned as ‘A Diamond is Forever’ (or Hira Hai Sada Ke Liye…). Remember the TV ads that showed diamond as a necessity for love? From where did this all start? So, the answer to this is a single company called De Beers. De Beers is a company synonymous to extravagance, opulence and scintillation. The company is expanded in such a way that if you think of a diamond and you’ll indirectly think about De Beers.
The De-Beers Monopoly
There have been rare cases of global monopoly in modern history and this case is a classic one. Till the late 1960’s, only one company controlled more than 95% of distribution and production of diamonds. Just imagine the kind of monopoly De Beers had with this example. In the 20th century if you thought of buying a diamond anywhere in the world at any point in time, you would have ended up buying a De Beers produce.
Being the single distributor and largest producer of diamonds, the company had every diamond on earth under its control. So much so that prices were decided by the company and no other entity had a say in it. And, before anyone could understand what’s going on, this system was topped up with some brilliant marketing. As a result, we see even today that Diamond indicates love. But why? Nobody knows!
History Has It!
The inception of all this dates back to 1866. This was the time when diamond mines were accidentally discovered in Africa. Then, as expected many miners went to claim the rewards. But, there was one person who had bigger plans. This person is one of the most controversial corporate characters in modern history. His name was Cecil Rhodes. This guy used to provide water pumps to miners on rent.
In the year 1874 pumps supplied by Cecil arrived at Kimberley mines. In 1880 De Beers Mining Company was formed. Around Eight years later De Beers literally bought all the claim holders and gained full control over the production. In 1890, a Diamond syndicate was created that ensured that diamonds remained as costly as they could be. Rhodes was behind all this. Cut to year 1902, enters Ernest Oppenheimer. This man expanded De Beers drastically in the 1900’s.
During the time of great depression in 1930, entire world was suffering with a slump. This got to diamonds as well and hence, the prices declined. But, it was De Beers therefore this problem did not last long. In fact, something happened that changed the course of the industry forever. De Beers launched a campaign ‘A Diamond is Forever’. It also stocked diamonds incurring initial losses and made huge gains in future by creating artificial demand and thereby increasing the diamond prices further!
Now… Happy Valentine’s Day to You
Coming back to today’s occasion, you now know what has hit you. A diamond is actually that expensive or it has been made so? You never know. Now if you wish to celebrate this occasion without a diamond ring, make sure that you make your partner read this blog. And in case you’re unable to convince, then go ahead and buy a diamond at whatever cost it’s sold. But afterwards, do ponder upon this information and make your partner read this blog so that the diamond mystery can be sorted.
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