Majors
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The quiet strategist
De Beers Diamond Jewellers Chief Executive Officer Guy Leymarie keeps a lid on his company's grand retail ambitions
June 01, 2007
In 2004, former Richemont executive Guy Leymarie joined De Beers LV (the name has since been changed to the more posh-sounding De Beers Diamond Jewellers), a controversial retail venture that united two corporate giants—De Beers the miner and LVMH the luxury group—in pursuit of a single cause: to create the diamond-jewelry retailing juggernaut of the century. Before long, reports surfaced claiming the company was set to open 150 stores within 10 years, frustrating independent jewelers who bemoaned the development as unfair competition. Three years on, reactions have mellowed, although critics persist. The CEO of the North American division, Alyce Alston, has departed (to Reader's Digest and her publishing roots). And the company now has three locations in the United States—Fifth Avenue, Rodeo Drive and Caesar's Palace in Las Vegas, the latter opened in January—as well as 15 stores globally, including eight in Japan, one in Taipei, one in Korea, three in London, one in Dubai and one in Paris. By year's end, Leymarie hopes to have a total of 30 stores.
Besides its strength in bridal, De Beers has scored a surprise hit with the two-year-old Talisman collection, a mélange of rough-diamond pieces favored by consumers craving an organic sort of bling. This year sees the expansion of that collection, the addition of new watch and men's collections and, overall, an intense focus on product innovation. Couture International Jeweler called Leymarie at his office in London to see if the CEO would divulge any news about the company's retail strategy. Alas, he would not (apart from one newsy snippet—read on for details).
Couture International Jeweler: Have you chosen a replacement for Alyce yet?
Guy Leymarie: No. We already have a team there with a retail director and a finance director, and we're very confident they can pursue the development of the business. We are looking for a CEO in due time. We don't put priority on timing. It's very much a matter of personality, leadership and motivation.
CIJ: What's your growth strategy in the United States?
GL: We want to be a major player on the U.S. market. It is the most important diamond-jewelry market in the world, so it is absolutely the top priority for us. We're opening stores in line with the space we find. As you know, there are shortages of prime locations, so we open only when we find a suitable location.
CIJ: You're also growing worldwide.
GL: Dubai we opened last year; it's doing very well in the Middle East. And we will continue to extend that network in the same spirit. We just opened in Seoul as a matter of fact. We will announce future openings in due course.
 | | De Beers Diamond Jewellers is sitting pretty after its Talisman collection of rough diamond jewelry, including the $45,000 medallion necklace at top, struck a chord with international buyers. |
CIJ: How have the stores performed?
GL: All markets are showing very significant growth rates, as the two shareholders mention in their respective annual reports. The American market is doing extremely well—it sees no signs of slowing down. In Asia, we are doing very well, including Japan. The fact that we are in the bridal market, in the high-end, gives us double leverage to sustain growth. The French market is doing amazingly well—a cult of diamonds is developing. The U.K. market is doing well on the high-end.
CIJ: I understand the watch collection is expanding.
GL: We will complete a Talisman watch collection in October with several different cases. It'll be a very significant collection with eight different models and a one-off on the high-end side. But the strategy is not to challenge watchmakers or to become a watchmaker.
CIJ: How have the jewelry collections been received?
GL: Secrets of the Rose—I call it "pre-bridal"—is doing well, but it's less universal than Talisman. You're in love, but you're not ready to commit. You want to choose a nice gift but not too significant. It's important to put De Beers top of mind for engagement.
CIJ: What about your online strategy?
GL: We will launch online in the United States in the coming months, hopefully before summer.
CIJ: Meaning an e-commerce site?
GL: Yes. Because we already have pricing information in the stores, online is a natural extension for us. But we will not put everything available online because when you buy a diamond, the brilliance is something you have to experience in the store. We will try to encourage people to come into the store.
CIJ: What do you say to critics who still think De Beers represents unfair competition?
GL (laughing): You know, we buy product on the open market. We are very small retailers compared to the size of the market, especially in the United States, where its health depends on new commerce entering. Isn't that the definition of a market economy?
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