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Carbon is the fourth most abundant element in the universe. It is in the graphite of a pencil, the soot of a chimney, and the stone at the centre of an engagement ring. The difference between the pencil and the stone is not chemical. It is a billion years of heat, pressure, and the violent geology of the earth's mantle, followed by a volcanic eruption that carried the carbon to the surface, where someone dug it out, often under duress and unimaginable working conditions, cut it, polished it, set it in precious metal, and placed it on a velvet cushion in a shop. The person buying it will hand over two months' salary because something has been instilled in them that this is what one does as part of the ritual of lifelong commitment.
That something was invented in 1938, in a state of near-total commercial desperation, and it may be the most consequential act of marketing in modern history.
De Beers was founded in 1888 by Cecil Rhodes. By the mid-twentieth century, the company controlled between 80 and 90% of the world's rough diamond supply. By the late 1930s, however, the diamond industry was dying. Sales in America had fallen 50% since the end of World War I. The Great Depression had made luxury goods socially uncomfortable. Diamonds were considered an extravagance for the already wealthy.
Women actively discouraged their partners from buying them; Frances Gerety, the young copywriter who would eventually write the most famous advertising slogan of the 20th century, noted that women wanted "a washing machine, or a new car, anything but an engagement ring. It was considered money down the drain." De Beers faced commercial irrelevance.
They hired N.W. Ayer, a Philadelphia advertising agency, with a brief to rescue American diamond sales. N.W. Ayer's strategy was unlike anything the industry had ever seen: promote the idea of diamonds, not the company behind them. N.W. Ayer paid Hollywood studios to write diamond proposals into film scripts. They loaned diamonds to movie stars and planted stories about those diamonds in gossip columns. They sent lecturers into high schools to talk to teenage girls about the significance of diamond engagement rings. They commissioned fashion designers to discuss "the trend towards diamonds" on national broadcasts. None of it mentioned De Beers by name.
Frances Gerety and her magnum opus
In 1947, Gerety wrote the line: "A Diamond is Forever." Her male colleagues thought it was grammatically clumsy and meaningless. It appeared in every De Beers engagement advertisement from 1948 onwards. Advertising Age named it the greatest slogan of the 20th century. American diamond sales rose from $23 million in 1939 to $2.1 billion by 1979. In 1940, 10% of American brides received a diamond engagement ring. By the 1990s, 80% did. Ian Fleming, whose close friend Philip Brownrigg was a senior De Beers executive, borrowed the slogan for the title of his fourth Bond novel in 1956. The 1971 film starred Sean Connery. Shirley Bassey sang the theme. An advertising line written by a young woman whose colleagues dismissed it migrated from a print advertisement to a novel to a film, and eventually became one of the most recognisable songs in popular culture.
They repeated the formula in Japan. In 1967, 5% of Japanese brides received a diamond engagement ring. The tradition did not exist in Japanese culture. De Beers ran targeted campaigns positioning diamond rings as modern, Western, and aspirational.
By the 1980s, 60% of Japanese brides received one. A billion-dollar annual market, conjured from nothing, in a country where the concept had no cultural precedent whatsoever. The Western world's influence on post-war Japan reshaped everything from diet to ritual; diamonds were simply the most profitable example. The "two months' salary" guideline that every engaged man has absorbed as though it were an ancient custom originated from an N.W. Ayer campaign.
De Beers built a double lock. On the supply side, the Central Selling Organisation controlled how many diamonds reached the market. Buyers, known as sightholders, received pre-selected parcels at non-negotiable prices. When independent producers entered the market, De Beers flooded the market with similar stones to crash prices. They pleaded guilty to price fixing in 2004 and settled class-action lawsuits for $295 million. On the demand side, they convinced the Western world, and then Japan, that a compressed piece of carbon was the only acceptable proof of romantic commitment.
Then they sealed the exit. A functioning resale market would have revealed the true volume of diamonds in circulation and collapsed the illusion of scarcity overnight. De Beers never published wholesale prices, so consumers had no reference point for what a diamond was actually worth. They discouraged jewellers from offering buyback or trade-in programmes. "A Diamond is Forever" functioned as both a romantic sentiment and a commercial instruction: hold it, never sell it, keep it off the market.
The effect was total. A diamond loses 25 to 50% of its retail value the moment you leave the shop. Gold has a liquid resale market. Property has a liquid resale market. List a diamond on any secondhand platform, and you will learn, very quickly, that the commodity you thought you owned does not behave like one. Diamonds were engineered to flow in one direction: from mine to finger. Never back.
Lab-grown diamonds were supposed to break all of this open. Chemically identical. Physically identical. Optically identical. A gemologist needs specialised equipment to distinguish them. The promise was the democratisation of luxury: the same stone, without the monopoly markup, without the ethical complications of mining, at a fraction of the cost.
Lab-grown now accounts for roughly half the market by volume. Wholesale prices for a one-carat stone have fallen from $4,200 in 2018 to $168 in 2025. De Beers has been written down from $9.2 billion to $4.1 billion. They reported a $511 million loss last year. Anglo American is actively selling its 85% stake.
The disruptors are collapsing too. Lab-grown prices cratered for the same reason natural diamonds were ever expensive: scarcity. When you can manufacture an infinite supply in a laboratory in three weeks, nobody values it. The technology that democratised the product destroyed its price. Lab-grown producers assumed there was genuine value trapped behind De Beers' monopoly that would be liberated once the controls were removed. There was not. The controls were generating the value. Remove them, and there is nothing left for anyone, including the people who removed them.
High-Pressure High-Temperature (HPHT) Machine
A natural diamond and a lab-grown diamond are physically indistinguishable. The market prices one at roughly 25 times the other. The only variable is origin. One endured a billion years of geological pressure to reach the surface. The other took three weeks in a machine. Until lab-grown existed, the value of that journey was an article of faith; a feeling, a cultural consensus, something everyone understood but nobody could price with any precision. Lab-grown changed that. It provided, for the first time, an exact metric.
Wholesale lab-grown fell from $4,200 to $168; 96% of the price evaporated when the only thing that changed was the origin. Everything else, the chemistry, the cut, the clarity, the sparkle, remained identical. Which means that 96% of what anyone ever paid for a diamond was the story of how it got there. 4% was the stone in your hand. The entire weight of value rested on the narrative: the billion years, the rarity, the earth producing something singular. The stone carried the story. Without the story, the stone is a beautiful, sparkling, almost worthless object.
Every premium you have ever paid for anything operates on some version of the same economics. Narrative creates value through three forces working simultaneously.
Scarcity: controlled access creates desire; if everyone can have it, nobody wants it.
Provenance: the origin story creates meaning. A first edition of a novel is the artefact that broke ground, the object the author held, the copy that existed before anyone knew whether it mattered; the reprint contains the same words and none of the weight. An original painting and a perfect reproduction deliver the same visual experience; one hangs in a gallery and the other in a dentist's waiting room, because authenticity is the entire price difference. A natural diamond carries the same artefact quality: it endured this specific billion-year journey. Lab-grown keeps the object and erases the journey.
Social signalling: ownership communicates status. A diamond on someone's hand, in an era where most wealth is invisible and digital, remains one of the last public declarations of what someone was willing to spend on you.
The Hermès Birkin
The Hermès Birkin bag operates on all three: scarcity maintained through controlled production and a purchasing ritual designed, quite deliberately, to exclude; provenance rooted in craftsmanship and heritage; social signalling through a price tag starting at £8,000 and a waiting list that exists to remind you that access is not guaranteed. Even Birkin resale premiums are cooling; from 2.2x retail in 2022 to 1.4x now, as the luxury market contracts and the broader narrative of aspirational consumption frays at its edges. Hermès still controls production. The custodian is still in place. The value holds, for now. Remove the custodian entirely, as lab-grown diamonds do, and the structure does not soften. It evaporates.
All three forces depend on someone behind the curtain. Someone is controlling access. Someone is maintaining the projection of scarcity. Someone is ensuring the story holds. The weird little man never gets revealed. The entire system works because nobody looks too closely at the mechanics. Lab-grown pulled the curtain back. What was revealed behind it was a billion-dollar industry sustained by manufactured cultural ritual, controlled supply, engineered demand, and the systematic suppression of any market that might have revealed the truth about what a diamond is actually worth.
In 2007, Damien Hirst had Bentley & Skinner, the Piccadilly jewellers, cover a platinum cast of an eighteenth-century human skull in 8,601 flawless pavé-set diamonds. He kept the original teeth. He titled it "For the Love of God," after what his mother said when she heard what he was planning. The asking price was £50 million. Hirst claimed it was sold, in cash, to an anonymous consortium. The consortium included Hirst himself. In 2022, he confirmed he still co-owned it. It has never left a vault in Hatton Garden. The sale, it appears, never actually happened. Germaine Greer put it best: "Damien Hirst is a brand, because the art form of the twenty-first century is marketing."
She could have been talking about De Beers. She could have been talking about every luxury brand that has ever existed. A platinum cast of a human skull, encrusted with 8,601 diamonds, bearing a price tag that may be fiction, created by an artist who understood, perhaps better than anyone in this story, that the value was never in the object. It was in everything you were told about the object. Underneath all those diamonds, it is still a skull. Underneath all the narrative, a diamond is still carbon.
The lab-grown producers did exactly what every disruptor promises; They removed the custodian. They let the market set the real price. And the real price turned out to be almost nothing. For everyone. Including them. They didn't free the market. They emptied it.
The article that first exposed all of this was published in The Atlantic in 1982. It is forty years old and reads like it was written last week.
See you on the next one.
