ALBERTO MONCADA, De Beers market controller for Southeast Asia, analyzed the Thai diamond consumer market for the 1990s. The following report is from a presentation he recently made in Bangkok for the Diamond Information Service, a consumer division of De Beers.
Thailand has seen tremendous growth in the last few years, in all areas of the economy. And diamonds have been no exception. Diamond imports into Hong Kong (which tend to reflect developments for the whole region, as the majority of diamonds are imported into Southeast Asia via Hong Kong) have grown at an immense rate, increasing 144 percent from 1980 to 1989. This rate is faster than the rate of total real private consumption for Southeast Asia, which grew by 90 percent.
What does the future hold for the Thai market? Well, we obviously cannot say for sure, but we do have some strong indications of how the Thai consumer will develop in the 1990’s, most of which are extremely positive for the diamond trade.
Change in GNP per capita
The average Thai consumer in the 1990’s will be more affluent than ever before. Between 1986 and 1989, GNP per capita grew by 81 percent. With the continuation of rapid urbanization, industrialization and increased education pushing up wages, this growth is expected to increase even more dramatically, to 134 percent, between now and the year 2000.
Increase in affluent households
The total number of Asian households with an income of US$10,000 plus is expected to increase 53 percent by the year 2000. Those with incomes more than US$30,000 are expected to increase at an even faster rate, by 77 percent, during the same time span, bringing the total number to more than 20 million households in the region.
Working women
The importance of women to the diamond market cannot be ignored. Increasing numbers of women are joining the workforce, contributing to the spending power of dual income households. Their numbers are likely to increase further in Thailand as the education of the population gathers pace.
The new-found social status that is being achieved by women in Thailand has two benefits: first, their freedom to purchase against an independently earned and disposable income and, second, more social occasions outside the home—which means more opportunities for women to wear diamond jewelry.
Trend setters
Among this new breed of working women, there is a special group who are the opinion leaders and style setters. They are affluent and demand quality. Seventy-two percent of these women state that they treat themselves to the finer things in life, compared with only 41percent of females overall. Sixty-three percent say they would like to look more glamorous, which fits in with the diamond image.
More young couples
The population growth rate is slowing down. The dominant age group is shifting from teenagers to young adults, resulting in more households since there are more young couples. The spending power is also shifting to a slightly older age group (35-44 years) which further increases the size of the potential diamond-buying public.
Fewer children per couple
The average household in the region currently has five members, but this will drop to four during the next few years. This is, of course, very advantageous for diamond jewelry sales, since it will result in more discretionary income for young families.
Consumer purchasing power
There is little doubt that consumers have more purchasing power in Thailand during the 1990’s. The remarkably high rate of personal savings is about 25 percent of the GDP in Thailand.
Desire to buy diamonds
There are a number of competitive products around to tempt the consumer’s money away from your jewelry store. Products that were previously out of reach for all but a handful of the super rich are now available to larger numbers of people.
In the increasingly competitive environment that faces us, the development and availability of new products is not likely to slow down. Diamond jewelry, because it has always been there, runs the risk of being forgotten amidst the rush for new gadgetry, particularly among young people.
A need for better service
The consumer’s experience in other product fields will increasingly color his attitude towards jewelers. The jeweler must therefore give his customers the better service they are beginning t expect.
Learn from other retailers
The jewelry trade should learn from other retail sectors, such as car dealers, to shift from pure selling techniques to marketing, providing the information and buying environment consumers of the 90’s require. This trend is best illustrated by the increasing number of magazine and book titles aimed at women who are looking for more information.
Well-informed jewelers
The new breed of consumers who have been brought up to make educated choices between similar products will continue to rely on jewelers t guide their choices of diamond jewelry. These consumers will choose a jeweler who is well informed and able to deliver the right messages about all his products.
The image a jeweler projects to his customer is of utmost importance and helps to provide a rewarding shopping experience.
Diamonds of distinction
Natural beauty always shines (JewelSiam June-July 1991 P 62)
Some of Thailand’s leading diamond jewelers, socialites and models came together recently for the 1991 Diamonds of Distinction Charity Gala. The evening was themed “Natural Beauty Always Shines” and featured the creations of four local jewelers: Jubilee Diamond, 99 Carat Creation Co, Siam tiara and Tiara Gems. Jointly organized by Somdej Phra Srinagarindra Parks Foundation, under the royal patronage of HRH Princess Mother and the Diamond Information Centre, the gala raised funds for the construction on additional Princess Mother’s parks and maintenance of the existing 12 parks throughout Thailand. “We combined the themes of parks and diamonds,” explains Nonglak Paisansinsup of the Diamond Information Centre, “because in both cases man’s intervention brings out the beauty of nature.”