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“ The retail diamond market is comprised of three broad categories of diamond sources; jewelry stores, ecommerce diamond companies and diamond brokers. ”

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Will ferrell snl skit boardroom Until recent years, jewelry stores were the only option for most diamond shoppers. This was especially true for smaller towns and rural areas. These stores had a monopoly, much like Ma Bell with the phone systems during most of the 20th century. Jewelry stores were the only game in town and could set their prices at whatever markup they wanted.

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Jewelry stores depend on impulse buying so they focus on having a selection to pick from, name recognition through extensive advertising, and being convenient so shoppers can walk in and make a purchase with no education or knowledge of the product. If it looks nice to an impulse buyer, they will pull out the credit card and have it gift-wrapped. To attract the impulse buyer, jewelers built elaborate stores with polished marble floors, expensive display cases, and lighting that makes everything in the store sparkle.