What Watchmaking Teaches Jewellery About Lab-Grown Diamonds

The argument in brief

Watchmaking fought the same battle over a man-made material in 1972 and won it, and jewellery can use that precedent only if it reads it correctly. In April of that year Audemars Piguet launched a stainless-steel watch priced above gold watches of the day ⁵, and the trade was sceptical. Fifty years later the steel Royal Oak is among the most sought-after watches in the world, and the example its designer Gérald Genta kept for himself sold at Sotheby's for CHF 2.1 million ³.

Jewellery is now having its own stainless-steel moment, and handling it far less gracefully. Lab-grown diamonds are diamonds. In 2018 the US Federal Trade Commission found that they share the optical, physical and chemical properties of mined stones and concluded: "Thus, they are diamonds." ¹¹ Eight years later the trade is still arguing over what to call them, whether they are "real", and who gets to decide.

Luxury is defined by what the maker does with the material.The thesis of this article

This article makes three claims, each backed by the sources listed at the end:

1. Watchmaking settled the same argument by moving value out of the material and into design, finishing and brand.
2. Watchmakers have used lab-grown gemstones for a century, and nobody calls the watch fake.
3. The analogy is imperfect in ways that matter, and the imperfections show jewellery what to do next.

Steel made precious: the Royal Oak and Nautilus precedent

It is easy to forget how unlikely steel's rise was. Before the Royal Oak, steel was regarded as too utilitarian for haute horlogerie ¹²: a metal for tool watches, not for the dressy end of the catalogue. Audemars Piguet's answer was to price the steel watch above many gold ones and let the design make the argument. Sotheby's summarises the effect by saying the Royal Oak "accorded stainless steel the status of a worthy and noble material" ¹³. Launch-price figures vary by source, but they sit at roughly CHF 3,300 to 3,650 ¹⁴, a figure that put a steel sports watch in gold-watch territory.

Patek Philippe repeated the move in 1976 with the Nautilus, and was still explaining it three decades later. Its own 2006 press release for the Nautilus anniversary edition opens by observing that "One of the world's most expensive watches is made of steel", and goes on to say that the watch world was perplexed and sceptical when the model first appeared ¹⁵. The Phillips lot essay for an early reference calls the launch "an enormously brave marketing move", and records that a 1979 Nautilus 3700/1 later sold for CHF 189,000 ¹⁶. The lesson is not that steel is secretly as good as gold. The lesson is that Patek and Audemars Piguet decided what the metal would mean, and then made the watch live up to it.

The industry has since built an engineering story to match. Rolex's Oystersteel is 904L steel, produced exclusively for Rolex since 1985 and drawn from the family of alloys used in the aerospace and chemical industries ¹⁷. The material is humble in origin and deliberately specified, finished and marketed as something more.

The commercial result is visible in the numbers. Swiss watch exports in 2025 reached CHF 25.6 billion, down 1.7% ¹⁸, and steel is the largest material category by value ¹⁹. An industry that once treated steel as the cheap option now earns more from it than from any other case material.

Lab-grown gemstones in watchmaking: a century of use

The second claim is the one the jewellery trade tends to miss. Man-made gemstones are not new to the watch industry, and they are not a scandal there. In the early twentieth century the Verneuil process, developed in 1902, made synthetic ruby and sapphire cheap enough to use in volume, and most jewel bearings in mechanical watches are now synthetic ruby or sapphire ⁶. A recent US patent application for a watch component states the point in passing, noting that "synthetic stones are used in horological movements" ²⁰ as a matter of routine. Synthetic sapphire is also the standard material for premium watch crystals. Nobody calls a mechanical watch fake because its movement runs on lab-grown ruby. The stone is functional, the maker's skill is what is on show, and the origin is not hidden.

The more telling examples are decorative. At Watches & Wonders in March 2022, TAG Heuer unveiled the Carrera Plasma, set with about 11.7 carats of lab-grown diamonds ⁷. The brand's own release calls the watch "a major milestone" ²¹ for the house. The parent group is not treating the technology as a gimmick either: LVMH's venture arm invested in Lusix ²², a lab-grown diamond producer.

There is a counterpoint, and it should be stated plainly. An LVMH executive told Reuters that the group will not use synthetic diamonds to a significant extent ²³. The luxury groups are experimenting at the edges while their top-tier jewellery brands protect the natural-stone story. That split is itself informative, and the later sections return to it.

Where the lab-grown diamond analogy breaks

A good analogy earns its keep at the points where it fails. Four differences matter, and each one changes what jewellery should do.

1. Steel is not gold. A lab-grown diamond is a diamond

Steel competed with gold by being a different material with a different story. A lab-grown diamond is chemically and structurally the same material as the mined stone it competes with, so it cannot lean on difference of substance. It also cannot claim rarity, which is the premise of most diamond pricing.

2. The price has collapsed, and that changes the economics

Edahn Golan's wholesale tracking shows the lab-grown price index down 93% since July 2018 ¹. A one-carat stone that cost about $1,800 a carat in mid-2018 now costs about $80 ⁴, and the third-quarter 2026 update put a one-carat D-colour VVS stone at $87 a carat, the first uptick in the series at roughly 2% ²⁴. De Beers saw the same slide from the inside. When it announced in May 2025 that it would close Lightbox, it noted that the brand launched in 2018 at $800 a carat and that wholesale prices then fell about 90% ²⁵. Its chief executive said that supermarkets and Chinese output were pushing prices down ²⁶.

The consequence is that the stone no longer carries the value, and Golan's value-chain figures show where it sits instead. Of the $23.8 billion of lab-grown diamond jewellery sold at retail in 2025, about 3% went to growing the stones, and about 95% of the value was created after the stone left the grower ²⁷. Producers made 69.4 million carats of lab-grown stones against 98.8 million carats of natural rough, and lab-grown stones were 53% of US specialty-retail engagement-ring units but only 27% of the value. In watchmaking terms, the movement is cheap and the case, the design and the brand are everything. That is the Royal Oak's lesson in a single line.

De Beers drew a clear strategic conclusion from the collapse. Its closure announcement ties the fall in lab-grown values to its core belief in natural diamond jewellery as "a separate category from low-cost, mass-produced LGD jewellery" ²⁵. That is a decision to defend rarity, and it is coherent for a miner. It does not answer the question for anyone selling lab-grown jewellery: a line pitched as a cheaper diamond has no defensible position, while a line pitched as design does.

3. The grading language is being pulled apart

Since 1 October 2025 the Gemological Institute of America grades lab-grown diamonds on a Premium/Standard scale in place of the D to Z colour and FL to I3 clarity scales, and says it "will no longer use the nomenclature created for natural diamonds" ⁸ for them. The reason is practical: more than 95% of lab-grown stones fall in a narrow colour and clarity range ²⁸, so the old scales no longer separate one stone from another. IGI still issues full four-C reports. The two largest labs therefore now describe the same product in different vocabularies, which weakens the claim that the market judges both kinds of stone by one yardstick.

4. Resale is a weak point, and both camps overreach on it

The Natural Diamond Council's claim that lab-grown stones have no resale value was examined by the US National Advertising Division in 2021, which found the evidence "does not provide a reasonable basis" ²⁹ for the claim as made. That does not make resale a strength. The price index above means a buyer in 2018 holds a stone worth a fraction of what was paid, and JCK notes that the secondary market is small ⁹. The honest pitch for a lab-grown piece is joy and design, not investment. A watch brand would not sell a quartz fashion watch as an appreciating asset, and jewellers should not either.

The naming war as a business war

Watchmaking never had to argue about whether steel was a "real" metal, because nobody was selling steel by denying it was metal. Jewellery has spent eight years doing the equivalent with diamonds, and the rulings tell a more even-handed story than either side admits.

The regulator moved first

When the FTC revised its Jewelry Guides in July 2018, it removed "natural" from the definition of a diamond and dropped "synthetic" from the recommended terms ³⁰. Words such as real, genuine, natural and precious remain off-limits for lab-grown stones, but it is also deceptive to use them to imply that a lab-grown stone is not a diamond. The FTC then backed the rule with action, sending warning letters to eight companies in 2019, including over environmental ("green") claims ³¹. Its next review is not scheduled until 2028 ³².

The industry's self-policing cut both ways

In June 2021 the National Advertising Division, the advertising industry's self-regulatory body, ruled on cross-complaints from both camps. It told the Natural Diamond Council to drop claims on scarcity, resale, "real" and a three-times carbon comparison ³³, and found that the Trucost study behind its environmental claims had "several flaws" ³⁴. It also told Diamond Foundry to disclose the origin of its stones clearly ³⁵. Neither side came out clean.

The terminology fight is still live

On 7 September 2026 the CIBJO board, meeting in Vicenza, recommended "synthetic" as the single most unambiguous term when communicating to an international audience ³⁶. The Diamond Producers Council responded by calling the move "biased and deceptive" ³⁷. The practical effect is a patchwork: France and Russia allow only "synthetic", while the US and India allow "lab-grown" ³⁸. A jeweller selling across borders already has to keep several vocabularies straight.

The reason the vocabulary is so contested is that it is commercial. The Natural Diamond Council's chief executive has described lab-grown stones as "mass-produced in limitless quantities" ³⁹, which is a scarcity argument dressed as a description. Lab-grown producers, for their part, have an interest in the word "diamond" doing as much work as possible. Watchmaking avoided this because the steel Royal Oak did not need anyone to be wrong.

The environmental case is genuinely unsettled

The Natural Diamond Council's 2025 report says more than 70% of lab-grown diamonds are made on coal-reliant power grids in China and India ⁴⁰. That is an industry claim from an interested party, and the same body's earlier environmental study was criticised by the NAD. Neither side has settled the question with audited, comparable data. A jeweller who wants to make an environmental argument should publish audited figures for the specific supplier and energy source, or drop the claim.

Consumer adoption and its caveats

In engagement rings, the market has already decided. The Knot's 2026 study of 10,474 couples who married in 2025 found that 61% of engagement rings had a lab-grown centre stone, up 239% since 2020 ². The report's conclusion was that "The engagement ring market has fundamentally shifted". The spending gap is just as telling: about $4,300 for lab-grown against about $7,000 for natural ⁴¹. Buyers are choosing a larger or better-looking stone for less money, which is a rational choice and not a lapse of taste.

Pandora saw this early. When it moved into lab-grown stones in 2021 it framed the decision as democratic: "Diamonds are not only forever, but for everyone." ⁴² That is a legitimate position for a mass-market brand, and it is the quartz-era Swatch logic: a different product for a different buyer.

The houses at the top are holding the line

Tiffany's then-chief executive Alessandro Bogliolo said in 2019 that luxury depends on "exceptional rarity", and that lab-grown diamonds were fashion rather than luxury ⁴³. In October 2026 Rapaport reported that Richemont and Signet were in talks to join a bid for De Beers ⁴⁴, which points to continued interest among the large jewellery groups in the natural-diamond supply chain. If the premium houses treat lab-grown stones as a different category, then lab-grown jewellery does not compete with them on their ground. It competes on design and price at a different tier, as Swatch did with the Swiss luxury watch.

The quartz crisis is the better parallel than the Royal Oak

Between 1970 and 1984, Swiss watch employment fell from 90,000 to a little over 30,000, and the number of companies from about 1,600 to about 650 ⁴⁵. The industry did not recover by denying that quartz worked. It recovered by segmenting: the plastic Swatch launched in 1983 ⁴⁶ at the accessible end, while the mechanical watch was repositioned as craft and luxury at the other. Both strategies survived because each made clear what it was selling. Jewellery's equivalent is to stop treating lab-grown and natural as rival claims on one definition of "diamond", and to build separate, honest propositions for each.

The cost the debate ignores: Botswana and De Beers

The steel analogy is comfortable because steel's rise displaced nobody. Lab-grown diamonds are different, because the incumbent product supports whole economies, and the argument about "real" and "fake" tends to skip over that.

Botswana

Diamonds account for about 80% of Botswana's exports and a third of government income ¹⁰. Output at Debswana, the joint venture with De Beers, fell 39% over 2023 to 2025 and the economy shrank 3% in 2024 ⁴⁷. Debswana also runs schools, hospitals and game parks, so a downturn at the mine reaches public services directly. A finance ministry official described "massive liquidity challenges" ⁴⁸, and Reuters reported that the country's diamond stockpile was nearly double the permitted level ⁴⁹. Lab-grown supply is not the only cause. Weak demand across the market and the supply side's own overproduction have contributed. But it is part of the picture, and it is the part that the "consumers have voted" argument leaves out.

De Beers

The company was valued at about $17.6 billion when Anglo American and the Oppenheimer family took it private in 2001 ⁵⁰. Anglo has since written its book value down from $9.2 billion in 2023 to $2.3 billion in early 2026. In July 2026 it was reported to be selling its 85% stake for about $1 billion to the Global Diamond Consortium, led by former De Beers chief executive Gareth Penny and including the governments of Namibia and Angola, with about $500 million of fresh capital to follow. On that price, Anglo's holding implies a value of about $1.2 billion for the whole company ⁵¹. By mid-October, Botswana was reported to be close to agreeing a larger stake in the business ⁵², and the sale had not closed.

None of this is an argument against lab-grown diamonds. Consumers are entitled to prefer them, and a price this low is a genuine benefit to buyers. The point is narrower. A jewellery trade that embraces lab-grown stones while ignoring what happens to the countries that depend on natural ones is making the same mistake as the natural-diamond lobby, only in the other direction. Producing countries need to capture value in what remains of the natural trade, through ownership, beneficiation, and a clear story about provenance. That is also a commercial opportunity: a natural stone with a documented origin in a country that benefits is a better story than rarity alone.

The real lesson: five steps for jewellers

It is tempting to summarise the watch story as "luxury is defined by the buyer". The evidence does not support that. Buyers did not decide that steel was luxurious in 1972; Audemars Piguet decided it, priced it accordingly, and then did the work to make the decision true. Buyers followed. The better summary is that luxury is defined by what the maker does with the material.

For jewellery, that points to five practical steps.

1. Sell design, craft and provenance, not carat countWhen the stone is the cheapest part of the piece, the stone cannot be the pitch. Golan's value-chain data says it plainly: almost all of the value is created after the stone leaves the grower.
2. Disclose origin plainly on every piece, and drop the "real" and "fake" rhetoricThe regulators have already ruled on this, and the NAD held both sides to account. Watchmakers disclose what is inside the case, and a jeweller should be equally plain about a stone's origin.
3. Do not sell either kind as an investmentThe lab-grown price curve and the thin secondary market make that claim unsafe for lab-grown stones, and the natural-diamond market is itself under pressure.
4. Back environmental claims with audited data, or drop themThe claims on both sides have been challenged. "Environmental transparency" is only a selling point if the numbers can be inspected.
5. Show natural and lab-grown side by side, with an honest explanationAudemars Piguet and Patek Philippe sell steel and gold models side by side, each presented for what it is. A jeweller who presents both kinds of stone with equal candour will earn more trust than one who defends a single position.

Conclusion

Audemars Piguet did not win by arguing about steel. It won by making steel worth wearing. Jewellery's version of that move is open to anyone willing to sell the design, the craft and the provenance, to say plainly what a stone is, and to stop treating the argument over the word "diamond" as the business. The natural-diamond trade, and the countries that depend on it, need a story that does not rest on rarity alone.

Sources

Note: Deal terms described here are press reports and may change. Figures from secondary outlets should be checked against primary releases. This article is general analysis for information only; it is not investment, legal or financial advice. See our Website Disclaimer.