DeBeers Case

INTRODUCTION

DeBeers is a mining, processing, distribution and selling Diamond Company that was founded and established by Cecil Rhodes in the year 1888. It happens to be a family of companies that dominate the market with diamond. DeBeers has it`s headquarters in Johannesburg, South Africa, it serves the world has the market dimension and has recently moved to China to explore market opportunities. The DeBeers Group has a workforce of above 20,000 and yields revenue of $6.8billion annually after taxing. Throughout the twentieth century, De Beers dominated the world market of diamonds internationally. The techniques that the company used to dominate the market was: it produced many similar diamonds to the market of those who refused to join the de beers association of diamonds. It bought and stocked diamonds by other manufacturers so that they could control the pricing in the supply, and lastly, it convinced the sole producers to join the company hence attaining monopoly. The monopoly ended in 2000 following decisions made by producers from such countries as Australia, Canada, and Russia. There are currently other chief diamond producers like: Rio Tinto, Harry Wintson and Lev Leviev. (Bertie, 2006)

The De beers company is registered at Luxembourg and is privately owned. It consists three shareholders: the Oppenheimmer family or the central holdings share holds forty percent, fifteen percent is directly own by the Government of Botswana and lastly the Anglo American Plc that has a share holding capacity of forty five percent. The management corporation of the De Beers group of companies is called the De Beers Societe Anonym (DBSA). DeBeers has many companies under it and hence the TITLE De Beers family of companies. These companies include: De beers diamond jewelers who specialize in retailing of diamond jewels, De beers Canada and Diamdel for mining, diamond trading company south Africa and diamond trading company Botswana aid in the trading practices of the diamond products, Foremark, Namdeb, and Namibia trading company deal with the industrial diamonds .

MARKETING TECHNIQUES

The de beers company has been successful in then most for increasing the demand for diamond to consumers in the world market. The most successful and greatest strategy was the use of diamonds to symbolize commitment and love. This has made diamond very precious and people have bought these diamonds to express their feelings of love to their family and friends. Other campaigns include the “eternity ring’’ that symbolizes continual appreciation and affection, “the right hand ring” that is mostly worn by women to show their independence and “the trilogy” that signifies the past, the present and future of a relationship. These slogans have helped greatly in the marketing of the De Beers diamonds in the world market. (OECD, 2004)

MOVING TO CHINA BY DE BEERS

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