How to buy a diamond online

published: 2011/01/01. tags: diamonds, loose diamonds

How to buy a diamond online

Everything is unique if identified with enough properties

This is not something I had ever dreamed of writing about. Being in software profession, how can someone like me give advice to someone about diamonds? Yes and No. For 2010 Christmas I happened to buy a diamond and in the process learned a lot about diamonds. I am not going to teach you about all the regular details like the 4 Cs of a diamond which is well covered by many websites. I am going to focus more on the process of buying the diamonds online. Whom should you buy from, whether you are getting it at the lowest possible price or not (though price alone shouldn't be the criteria) and how to find out if multiple online retailers are offering the same diamond for comparison shopping.

The 4 Cs and more

While I promised to not talk much about the standard jargon about diamonds, I will just enumerate the most common things to look for when doing the shopping. The four Cs of the diamonds are carat (size of the diamond), clarity (reflects how pure the crystal is without any defects which are usually hard to see to the naked eye and mostly visible at 10x magnification), color and cut (factors like polish and physical dimensions effect the cut). There is one other key factor, had it's name started with a C, I am sure we would be talking about the 5 Cs instead of 4. And that is the shape of the diamond. Perhaps, if one were to use contour, it becomes the fifth C. Shape is equally important because it dictates the price. I found 10 different shapes being offered of which Round is the most popular and expensive all other things being equal (more or less). Well, we can't really say all other things being equal because their price is determined by how much light they emit which is measured as fire and brilliance and the reflection characteristics of light vary with the shape of the media. Hence, it doesn't make sense to say all things being equal for diamonds of different shapes.

When you are shopping for diamonds, you would notice that for a given shape and all 4 C's being equal, there is still variation in the price. The reason for this is, there are additional dimensions against which a diamond can be measured. Most of these dimensions are actually reflected in coming up with the Cut grade of a diamond. However, since there are only 4 Cut grades, they don't precisely tell us how the diamond measures up along these other dimensions. Among these several dimensions, the most important ones are the polish, symmetry, fluorescence, girdle and culet.

My research so far had been limited to the round diamonds because that's what I purchased. An excellent cut round diamond has 57 faces and if the culet (the bottom part of the diamond) is not pointed and has a small face, then it's considered to have 58 faces. While a diamond by itself can reflect light in any direction, since diamonds are used in jewelry, they are usually enclosed and most of the time only one face of the diamond is visible. So, irrespective of the shape of the diamond, their respective cuts are optimized for emitting the maximum amount of light out of this top surface. There are a handful of websites that actually provide some physics and math behind these cuts. While there are a few parameters of the diamond that influence the emitting of the light, the table size (the top most flat surface) and depth of the diamond play a critical role along with the angles.

I don't want to go any further on explaining about the characteristics of a diamond as they are well covered on websites by people who are in the business or are very knowledgeable. My reason to mention these details is, for most of us who are not much familiar with diamonds, once we use the fancy user interface with sliders to narrow down on the 4 Cs, we still notice that there is a wide range in price for a fixed carat. Now you should know why that is the case.

One last note on the diamond properties. I remember reading at a website that diamonds are not really that rare and people just buy it for various reasons perhaps including showing their love and commitment to someone, as an investment and probably a lot of media and hype. While a lot of it is true, you would realize that no two diamonds are alike. If you just look at the 4 Cs, then you would find a lot of similar diamonds. But once you start being more specific, then they start becoming rarer and rarer. You would notice this if ever you try to select two similar diamonds for the two ear rings.

Diamond Marketplaces, Memberships and APIs

When you search for diamonds online, have you noticed how there are a lot of retailers advertising? If diamonds are so rare then how is it possible that there are so many retailers who are able to sell them? Well, actually, most of them don't carry the diamond inventory themselves. This is where diamond marketplaces come into picture. There are a handful of companies which allow the people who own the diamonds to upload their diamond information and allow the retailers to access this information. For this both parties have to be registered as members and there is typically a monthly membership fee. These e-marketplaces provide access to their database in the form of a HTML widget that can be integrated into the retailer's website with look and feel customization. For a non-technical consumer, it's as if they are ordering the diamond from the retailer. But in reality, once the order is taken, the retailer actually works with the dealer in fulfilling the order. It might sound like it's unnecessary to go through these middlemen to buy your diamonds. But this is necessary because of two reasons. One, you don't have access to the dealers and there is no guarantee that they would offer you a better price for that occasional purchase. Second, you usually want to buy the diamond and put it into an engagement ring or an ear ring or a pendant. So, the retailers offer this value added service. In fact, based on my personal experience, my retailer probably made more money from putting the diamond in the jewelry than on the loose diamond. Unless you have a very trusted jeweler it's probably not recommended to buy loose diamonds and then make the jewelry.

Anyway, by carefully looking at your retailers website, you might be able to find out which marketplace they are using. Some big players don't use the marketplaces or at least it's not obvious. It's possible that they have special deals with these marketplaces where they get the daily feed of the diamond database and they provide the entire diamond selection from within their own website and not using the marketplace's widget.

The few marketplaces that I noticed as part of my research are polygon.net, diamonds.net and gemfind.net. Surprising that all of these guys have chosen to use .net for their domain name instead of a .com.

Diamond Grading Report and Laser Inscription

OK, you selected what you want, paid that hefty price and you got your diamond. How do you trust you got what was claimed when you ordered? Well, that's where comes the organizations that grade the diamonds and provide grading reports. Note that these are supposed to be called as reports and not certificates as they don't certify but simply provide a report. The specific diamond I bought was graded by GIA. When searching for diamonds, some of them provide you an option to filter by whether the diamond has a grade report or not. If you are buying online and don't know anything about diamonds, I suggest that you only buy diamonds that have been graded. Some may offer diamonds without such grading reports for lesser price, but I think depending on how much you are spending and your level of comfort, it's worth that extra money. Now how do you know if the report itself is genuine or fake? That's a good question. In case of GIA, each diamond is graded and given a report that has a unique number. This number is laser inscribed into the diamond. Don't worry, the diamond is not harmed. The laser inscription is put on the girdle of the diamond, a place which is not as important and not visible in the jewelry. And more importantly, it doesn't contribute materially to the reflection of the light.

You can use the grade report's unique number to your advantage when shopping for a diamond. While each retailer uses their own SKU numbering for the diamonds they obtain from the marketplace, they can all be correlated using the grade report number. Once you identified the diamond that you are interested in, find out the certificate number and then do a search using it. You are likely to find a few online jewelry stores each offering it's own price for the same diamond. Note that this may not always work, but worth a try. Even if you don't find it for the exact diamond you are interested in, if you find it for others, that would also help you know whether your retailer is competitive enough or not.

As an example, I just searched for a 0.5 carat, D color, VVS1 clarity diamond with Excellent cut and landed up at a retailer who is selling it for $2,152.00 and also claimed to guarantee the lowest price. I looked at the GIA report and got the number and searched on Google and found a few websites that are offering the same diamond for different prices. The prices I got were $2,293.00, $2,360.00 and one UK retailer listing it for 2721.18 pounds! So, the initial retailer I checked does seem to have the most competitive price indeed.

Look & Feel Before Buy

You might be one of those people who needs to look and feel before you buy it. I don't blame you, after all you are spending a fortune to buy a diamond. This is where the local retailers thrive. You have the chance to go to their store and look at the diamond before you buy it. These days, these brick and mortar retailers are also embracing the internet technology and using the same marketplaces are able to provide a wider selection of diamonds to their customers. So, when a customer picks a specific diamond, then these local retailers actually can obtain the diamond from the dealer and show it. I am sure there is some cost associated with mailing the diamonds back and forth like this, but when the profit margins are in hundreds or even in thousands, this probably is a small price to pay for these retailers.

So, it's not always about the price. At the end of the day, you should be comfortable with the whole experience when you are buying such an expensive stone.

Few more things to watch out

The largest online retailer, Amazon.com, itself offers diamond jewelry for sale on it's website. However, I find the information given for the diamonds on their website to be insufficient to accurately determine if you are paying the right amount. How can some one say the color to be GH when it has to be either a G or a H? And mention about minimum color and clarity? It's likely that the dimaond is going to be on the lower end of the threshold they mention. So, if you are very particular about what you want, then buying from Amazon may not be the right choice. However, I did notice that the amount to pay for the jewelry is not as much as the other retailers charge to build your custom jewelry with your hand-picked (or is it mouse picked? :)) diamond.

Some of the retailers offer their own collection of diamonds which they call as "signature collection" or some other "private collection" and some of them even go to the extent of adding additional grading to the cut and polish. They also offer faster shipping if you pick a diamond from such collection. I think this is similar to ordering a standard computer versus ordering a specific configuration. Some of the work that needs to be done after the ordering of a diamond is probably already done for those in the collection. While you can choose to buy these type of diamonds don't buy them because they are supposed to be better than excellent cut or polish because the grading organizations don't recognize them any better than the standard they use.

Final words

Just a few days back I was completely ignorant of diamonds. But when I started doing research, I was fascinated by many things about diamonds. The science and math behind coming up with specific number of faces and proportion for the diamond is very interesting. The fact that there are so many different things to measure in those tiny little expensive stones is fascinating. And who can resist a triva that in Nov 2010, a pink diamond went for $46 million dollars in an auction? I will continue to educate myself on this subject as time permits. May even come up with a website to educate and offer more information about diamonds if I continue to like this subject.

Updates

Date	What's new?
01/08/2011	Say you pick the 4 Cs of the diamond, polish, symmetry, fluorescence, girdle and culet, and even the same physical dimensions, you could still see variation in pricing on a given day (to rule out time based price variation). The reason is one of the Cs, the clarity. On a GIA report, one can see an additional detail called "Clarity Characteristics". There are several types of the so called inclusions and a diamond of a given clarity can have any one of them unless perhaps it's graded FL (flaw-less). What type of inclusion it is, it's size, where it is located and how many are present can influence the price of a diamon. While this info is the last thing you should check while narrowing down the choices, you can use clarity characteristics in understanding the price differences when comparing from different websites or even the same online retailer.

Date

What's new?

01/08/2011

Say you pick the 4 Cs of the diamond, polish, symmetry, fluorescence, girdle and culet, and even the same physical dimensions, you could still see variation in pricing on a given day (to rule out time based price variation). The reason is one of the Cs, the clarity. On a GIA report, one can see an additional detail called "Clarity Characteristics". There are several types of the so called inclusions and a diamond of a given clarity can have any one of them unless perhaps it's graded FL (flaw-less). What type of inclusion it is, it's size, where it is located and how many are present can influence the price of a diamon. While this info is the last thing you should check while narrowing down the choices, you can use clarity characteristics in understanding the price differences when comparing from different websites or even the same online retailer.