The Economics of Lab Grown vs Natural Diamonds: What Jewelers Do Not Want You To Know
For more than a century, natural diamonds have been marketed as the ultimate symbol of love, permanence, and value. Entire industries were built on this promise, backed by corporations that enjoyed decades of very high profit margins. But times are changing, and not everyone is ready to embrace that change.
Today, a quiet battle is taking place in the jewelry industry. On one side are the established companies who have long profited from mined diamonds. On the other are new technologies and a new generation of consumers who see lab grown diamonds as a smarter, more ethical, and more transparent choice. The question is not whether lab grown diamonds are real. They are chemically and visually identical to mined diamonds. The question is whether the old guard can accept that the world has moved forward. GIA
The old guard and their margins
Companies like Signet Jewelers, the parent company of Kay, Zales, Jared and others, have relied on natural diamond sales for decades. Their model depends on keeping mined diamonds special in the public imagination because the margins are enormous. When demand shifts toward lab grown, investors notice and pressure rises. That is why Signet and De Beers launched a major natural diamond campaign called Worth the Wait aimed at younger couples. signetjewelers.com
Signet reports more than 6.7 billion dollars in annual sales. That scale helps explain why the company is focused on protecting its natural diamond margins. For decades those profits defined the foundation of their business, and any disruption from lab grown diamonds threatens that model.
It is true that even large retailers like Signet now sell lab grown diamonds through brands such as Kay, Zales, and Jared. They have had little choice but to offer them because younger buyers increasingly demand it. Yet at the same time, their marketing and business strategy still leans heavily on natural diamonds, where the margins remain much higher. This split strategy reflects the challenge they face: meeting consumer demand while trying to protect the profitability of the natural diamond business that built their company.
The pressure is real. Coverage has tied recent stock and guidance challenges to a tougher environment as lab grown gains share, and outside analysts have warned that younger buyers will continue moving in that direction. MarketWatch, Investing.com, The Bear Cave
Why many big companies do not pivot to lab grown
The answer is simple. Margins for lab grown are not as high as natural. These corporations built vast infrastructure over many years around the outsized margins that natural diamonds provide. If they pivot fully to lab grown, the unit economics no longer support those legacy costs, and shareholder expectations that were set on the natural model become hard to meet.
As technology improves and production grows, lab grown prices have become more accessible to consumers. This adjustment reflects efficiency and wider adoption, not a drop in quality. For customers, it means they can choose a larger or higher quality diamond for the same budget, something the natural diamond market has never been able to offer. The Wall Street Journal
And yet, instead of adapting to meet consumers where they are, some corporations try to rewrite the rules of the game the moment it stops favoring them. Changing the terms halfway through is not innovation, it is the protection of privilege. Greed should never outweigh a consumer’s freedom to choose. That is why our system of free enterprise exists: because the measure of success should always belong to those who provide the best product on a fair and open field.
The Netflix vs Blockbuster analogy
Think of natural diamonds as Blockbuster and lab grown as Netflix. Blockbuster made money on late fees and DVD rentals. Even after streaming arrived, the company resisted because it undermined the old profit machine. Netflix embraced a better way and changed everything. In our world, lab grown is the streaming model. It is not cheaper for the sake of being cheap. It is smarter, cleaner, and aligned with how modern consumers actually live and buy.
What lab grown really is
Lab grown diamonds are not imitations. They are real diamonds created through advanced technology that replicates the earth’s process of forming crystals under heat and pressure. The result is the same brilliance, the same fire, and the same durability. What differs is not quality but philosophy and value. GIA
- Better value so you can choose size and clarity that fit your vision at a fairer price
- Responsible sourcing without dangerous mining conditions or large scale environmental damage
- Transparency about origin that aligns with modern values
It is no surprise that younger generations are embracing lab grown for engagement rings and fine jewelry. MarketWatch
How big players are fighting back
Rather than adapt gracefully, several industry moves work to defend the old model.
Heavy marketing for natural
Signet and De Beers launched Worth the Wait to reframe natural diamonds for younger couples, while broader analysis shows the industry doubling down on campaigns that emphasize rarity and tradition as prices fall. signetjewelers.com, The Wall Street Journal
Strategic exits from lab grown
De Beers announced plans to close its Lightbox lab grown jewelry business and redirect focus to natural diamonds. That is a clear signal of where it wants the value narrative to land. De Beers Group Discontinuation of Lab-Grown Certification
Meanwhile, certification expands where demand is growing
The International Gemological Institute is expanding lab grown diamond certification capacity of the full 4Cs, reflecting strong demand and a push for consistent, transparent evaluation. IGI
Why this matters for you
This is not just an industry tug of war. It affects your choices as a consumer. If you are shopping for an engagement ring or a meaningful piece of jewelry, you deserve the truth. A mined diamond is not inherently better. It is often more expensive because the industry wants to keep it that way. Lab grown gives you freedom to choose a diamond that fits your values and your story with confidence and pride. The Wall Street Journal
The future is already here
Economics always catches up with reality. When a substitute delivers more value and aligns with modern values, it wins. Lab grown diamonds are not a passing alternative. They are the future of fine jewelry. The companies resisting this change are not protecting consumers. They are protecting margins. But the tide has already turned. The Wall Street Journal
For perspective, De Beers reported 3.3 billion dollars in revenue in 2024 . Haejin Jewelry began here, in a modest Brooklyn storefront. No big campaigns, no glossy billboards. Only careful work, fair pricing, and a belief that jewelry should be transparent, ethical, and accessible. Some companies optimize for margins. We optimize for meaning.
We are small by design. We spend our time listening, guiding, and making pieces that hold stories. If you choose us, it is not because of a billboard. It is because you value honesty over hype and craftsmanship over campaigns.
A note about local jewelers
This conversation is not about small independent jewelers who serve their communities with care. In fact, many of them are adapting beautifully, offering both natural and lab grown diamonds so that customers can make the choice that feels right for them.
Many independent jewelers serve their communities with care, whether they offer natural, lab grown, or both. What sets them apart is not the type of diamond they sell, but the way they listen to their customers, stand behind their work, and put trust and craftsmanship ahead of corporate margins. Supporting these small businesses means supporting people, not just products.
At Haejin Jewelry
At Haejin Jewelry, we honor both the beauty of diamonds and the people who wear them. That means authenticity, fairness, and a future where luxury does not come at the expense of conscience.