Diamond™

This is a story about how one of these brands became an overnight global success. Unfortunately, this is also a story about how technological innovation caught up with a brand that had no competitors, and destroyed the faith of those who believed it to be their greatest investment.

Around 1840, just before Queen Victoria of Great Britain was about to marry Albert, a small group of Jewish tradesmen in Holland saw enormous potential in a small transparent stone called a diamond. Back then even stones like rubies and opals were not thought that highly of, and it was the precious metals - silver and gold - that were highly valued. The royal wedding provided the perfect opportunity to set the stage for one of the most extraordinary branding exercises in history - and it all happened in just one day. The Dutch consortium promised to create a crown that would be made up of the most valuable diamonds that existed. It would be a wedding gift to Queen Victoria. They asked only that she would wear the crown on her wedding day. The royal court accepted the terms.

And so in a wedding photograph of Queen Victoria that was distributed to every corner of her empire, the humble diamond which was virtually unknown, instantly became an international object of desire.

Diamonds have not been around forever - at least not in our society. Diamonds are actually a brand - with no set value - other than what you and I agree to pay. For the past hundred years diamond dealers managed to keep the price under tight control. Strict monitoring and careful management of production has ensured the high prices. This created the perception that diamonds are a stone that will never lose their value.

That is until now. Technology has caught up with Mother Earth and can now create an artificial diamond that for all intents and purposes is indistinguishable from the real thing. Newsweek recently conducted a test. They had the finest technologically produced diamonds evaluated by experts. And only by subjecting them to rigorous, expensive testing will fakes be revealed. The equipment for testing the structure is scarce. The fact remains that diamonds, like so many other sterling brands, are now facing the harsh reality of copy-cat culture. The most important thing now is the perception of consumers.

In a few short years diamonds will be mass-produced for a fraction of the price. There will be certificates to prove authenticity, but true diamonds can no longer be simply identified with an eyeglass. The Jewish tradesmen who have spent years polishing, cutting and dealing in the stones are now migrating to new areas of business - areas like managing digital rights.

This story is not restricted to diamonds, it's a reality for almost every brand on earth. The days of point of differentiation are long gone. And those brands who try to create a truly different product will, sooner or later, be matched by their competitors. Rolex and Louis Vuitton have been there, the music and movie industry continues to face enormous copyright challenges, and now even diamonds appear not to last forever.

The point of the exercise is that as soon as you perceive your brand as such, treat it for what it is. Don't embark on a never-ending quest to find a rational point of difference, because it's this very juncture that may prove to be its undoing.