Survival of the Fittest

Signet and De Beers, titans of the diamond world, both revealed plans in recent days to consolidate their operations. It's survival of the fittest.

The phrase dates back to Charles Darwin and his evolutionary theory, although it was actually coined by another 19th-century thinker, Herbert Spencer.

He suggested it as an alternative to Darwin's "natural selection," applying it beyond biology to economics and society. He argued that free-market competition weeded out the weak, and fostered progress.

Today, the world's biggest diamond retailer and De Beers, the iconic diamond miner, are both weeding out the weak to foster the progress of stronger performers.

As the slump in demand for natural diamonds persists, they're both betting on "quality over quantity" - the survival of only the fittest brands and the fittest sightholders.  

De Beers once boasted 350 sightholders. As of July, it will have just 45. In the good old days, it enjoyed a near-monopoly of the global diamond industry. Its CSO (Central Selling Organisation), later replaced by the DTC (Diamond Trading Company), guaranteed "orderly marketing," throughout the 70s, 80s and 90s.

With so many vetted buyers and such rigid control, De Beers could fix prices, stockpile excess rough as needed, and ensure no single player flooded the market.

Today it's a very different story. De Beers lost $1.5m a day last year and remains on Anglo American's list of unwanted and unsold assets.

Last Friday it contacted its current 69 sightholders and told around a third of them it wouldn't be renewing their sales agreements.

It's a decisive though not unexpected move, designed to prioritize a small number of high-volume buyers that can absorb larger rough allocations.

But it comes from a position of weakness rather than strength. When the market was thriving, De Beers actively sought to sell far and wide. Today it can no longer afford to spread supply thin. Quite the opposite. Fewer sightholders means fewer canceled sights, better cashflow from reliable volume-takers, and a shot at deeper, more profitable partnerships.

Signet Jewelers tells a similar story downstream. It is also sharpening its focus, investing in winners and culling the losers. It announced earlier this week that it is ditching the James Allen and Rocksbox as standalone brands so it can concentrate on the four core brand engines - Kay, Zales, Jared and Blue Nile that generate the overwhelming majority of its revenue.

It's also shuttering almost 100 stores as part of the Grow Brand Love strategy announced by incoming CEO J.K. Symancyk last March.

It shifts the emphasis from store banners to distinct brands that target specific customer segments - romantic gifting, style/trend, inspired luxury and digital pure-play. 

Signet bought the online retailer James Allen in 2017 for $328m and paid an undisclosed sum in 2021 for Rocksbox.

Both proved to be weak links that drained resources. James Allen saw revenue fall by a third in FY2026. It suffered constant platform glitches and stole sales from Blue Nile in an already weak bridal market. Its designs will be absorbed into Blue Nile.

Rocksbox started out as a try-before-you-buy jewelry rental service, then morphed into secondhand sales. Some elements of will be integrated into Kay Jewelers.

Signet is still reviewing plans for Banter by Piercing Pagoda and its hundreds of mall-based stores and kiosks selling fashion jewelry.

But the direction of travel is clear - fewer brands, stronger brands.

Both De Beers (upstream) and Signet (downstream) face parallel pressures from the natural diamond slump. Both are pruning weaker elements and prioritizing quality over quantity.

Signet is maneuvering from a position of relative strength, seeking to secure its future. De Beers less so, having faced a drop in global demand for natural diamonds, and a parent company that has been less than fully supportive.

But both are embracing Herbert Spencer's philosophy - weed out the weak to foster progress.

Have a fabulous weekend.