What's wrong with AGS Lab?

[Texas Leaguer]

Bryan,

Thanks for the post. You touched on an important point. The decision of which lab to use is often made before the stone is even cut and the cutter must decide whether to aim for the GIA or AGS target. A ‘missed’ AGS-0 doesn’t just cost money in terms of lab fees, it both costs more for the production and results in a smaller stone. For people working on a razor thin margin, this could be a deal killer to even try if the possibility of this risk is seen as significant, especially in cases where it’s near an important weight barrier (like 2.00cts) and loss of a single point could mean thousands of dollars.

That's also an erred (and quite primitive) fashion to calculate the value of the near border weights.
The huge gaps in prices between a 1.95ct and a 2.01ct is simply wrong as currently calculated.

If the gaps wouldn't be so huge then it would pay to cut 1.98ct AGS 0's

This gets us into a whole other aspect of the problem with the fancy market. Rap prices have not kept pace on fancies, generally discouraging cutters from cutting shapes other than rounds. Now that prices are dropping a bit that might come more into balance. But to a significant extent it's a case of the tail wagging the dog - manufactures make decisions based upon alot of factors, including rap pricing.

 

[Texas Leaguer]

What GIA could do to improve THEIR market share is definitely a different question, as is what could be done to improve the overall quality of diamonds in the market. I’m rather narrowly thinking of AGSL in this thread.

The things that have come up in my mind as this has developed are:

Work on the consumer website content. Techy details for the people who really want to know the nitty gritty. They’ve got a pretty good market presence among that crowd anyway but this would improve it and those who don’t dig into it would at least go away with the impression that they’re the serious experts in this stuff.

Work on the Google presence and search engine optimization. Be a destination for educational content. Maybe even pay Google for certain adwords.

Somehow promote the grades below 0 as something other than also-rans. There are fabulous stones out there that don’t get the 0 but the market clobbers them.

Keep on the cutting edge of offering the best service, like the QR code thing mentioned above.

Establish and publicly publish retail prices.

Offer SOMETHING to tip the cutters and big players over the edge. Hard data showing that 000 is will bring more than xxx on a particular stone seems like a good place to start. If this is true, promote the heck out of it to the cutting community. If it’s not true, make it so. Assistance in how to minimize the planning risk seems like it would be really helpful. I’ve no idea how to do this but maybe online services to cutters of some sort? Give a discount or a rebate on non-0’s, especially to your manufacturers? Offer your manufacturers a discounted ‘pre-cert’ like EGL does so they know more about what they’re getting into before they spring for the Platinum report?

Assist the retailers, even non AGS members, in providing value added services for their customers by using AGSL services. As with item #1 above, I think the techy types would be right up their alley. Most sales staff are pretty intimidated about this sort of customer to start with and would love any assistance they can get. Point of purchase items come to mind but they can get pretty pricey so this may be a web based solution as well. Maybe an android and/or iphone app? A plugin for the stores site? ASET rocks but, at least around here, rather few of the retailers know how to use it and even those who do seem afraid of it because it ‘feels’ like it’s showing defects rather than features. If it makes 90% of the stones in the store look crappy, even if it’s correct, they aren’t going to want use it unless they KNOW that it’s going to close a sale on a 0. It eliminates plan-B if the 000 turns out to be over budget.

Build consumer brand recognition which, unfortunately, may mean direct consumer advertising, and advertising can get pretty expensive. I’m not sure where would be good or even if an advertising budget is in the cards but I think it’s worth considering. Anecdotal evidence suggests that others like GIA, IGI and EGL spend significant amounts in this area and it seems to be working for them.

Then again, who am I? They outsell me 100:1! I’m just some appraiser out in fly-over country.

Neil, you're like a one-man focus group for AGSL! I hope they are tuning in.

I do think they have done a good job staying locked in on their core competency of research and service. Perhaps if they had diverted more resources to marketing they would not be as good as they are. Especially in this uncertain economic times it has probably been wise for them to stay focussed on actually adding value rather than talking about the value they add. As has been said, that is largely up to others of us in the business to do. And I do think AGS member stores have a role and obligation there. (Perhaps the AGS selection criteria for membership should be modified to include consideration of how well a potential member promotes AGSL methodologies and services).

Having said that, many of the things you suggest could have positive impact without costing them a fortune.

 

[denverappraiser]

Another random thought:

At the risk of being trendy or of making Mark Zuckerburg even MORE money, social media may be a wonderful tool for them and an area where they have an advantage over the competition. They have a small but fantastically loyal fan base both among the trade and consuming public. Moreso I think than any other lab. I would guess that if they did a public survey of impressions of the various labs, they would get a lot of ‘never heard of them’, a fair number of ‘awesome’, a bit of ‘They suck because they’re not GIA’, and rather little in between. I would expect the other labs to have substantially different profiles. If this could somehow be leveraged into an Internet buzz, they may be able to raise their public awareness significantly without spending too much money. Please no videos of cute babies and cats but there may be other videos that could be created easily and cheaply and then the fanbase could help them go 'viral'.

 

[denverappraiser]

Some thoughts sent to me by Peter Yantzer, director of AGSL about this thread (yep, they're monitoring it).

----------------------------------------------------------------------------------------------------------------------

Below are some musings, thoughts and clarifications to some of the questions on your thought provoking post on Pricescope. I think there are a number of reasons why we don’t enjoy more market share. Please keep in mind that these are my personal opinions and you are free to agree, disagree or discount them to your heart’s content. You may do as you see fit with this information. Some of these opinions are repeats of other people who have posted in the thread. My reason for repeating them is to put all of my possible reasons in one location.

You ask what is wrong when AGSL does fine work, does it quickly, accurately and consistently and yet can’t seem to garner more market share. The consensus in the thread, at least to this point, seems to pretty much agree with that. Mysterious and paradoxical are two words that come to mind. I have believed that if you do good work you will be rewarded. That doesn’t seem to be the case in this instance.

For what it’s worth:
GIA has trained so many gemologists that they have built their clientele from the ground up. In a respectful manner I can say that they are farmers and their students are crops. Obviously they are very good farmers.

The industry has made GIA an integral part of the diamond industry. Everyone understands their system, their grading is good enough, their reports are accepted nearly every place on earth. They have rightfully earned their position in the diamond industry. Nearly everyone wants GIA to be successful and to stay successful, myself included. GIA is like a cart full of apples going down a dirt road. It’s perfectly OK for some apples to fall out of the cart and depending on the size of the rut in the road it can be a lot of apples. The apples are GIA’s reports and the ones that fall out of the cart are the ones that aren’t graded as accurately as the industry might like. But potential tragedy strikes if the apple cart falls over. Because then the diamond industry has a huge problem – its distribution network is completely broken for who knows how long. There is no backup. Similarly the same thing happens if too many apples fall out of the cart for too long a period of time. I don’t see that happening. So, our entire industry walks hand-in-hand alongside the apple cart to make sure it doesn’t fall over.

I have and still believe that it is in our industry’s best interest to have a backup. It’s pure and simple risk management. I also believe the AGS Laboratory has earned the consideration of being the backup. Will the industry ever manage its risk in this area? I really don’t know, I could be completely wrong and it could be wishful thinking on my part. If the industry comes to the conclusion that it is probably a good idea to develop a backup it will take foresight and planning to do so. You can’t wait for the system to break and then say “Oh. Let’s send all of our diamonds to this lab.” We, for example, couldn’t go from 2% to 80% of the world market in any satisfactory amount of time. By satisfactory I mean the timeliness the industry would need to overcome this speculative catastrophe. I am trying to make the case that AGS and its lab should be much bigger to be an actual benefit to the industry.

It is nearly impossible to overcome inertia. When people are comfortable with the status quo, what is their motivation to change? People change only when they are motivated to do so. It appears that working to create a backup is not a strong enough incentive. My experience is that something needs to occur, either positive or negative, with enough force or incentive to get me to want to change.

In its cut grading system, GIA’s weight ratio, though not published but reverse engineered, seems to be in the neighborhood of 8%. The AGS weight ratio standard is 5%. This gives manufacturers an opportunity to save approximately 2.8% more weight from certain pieces of rough ( 1.08/1.05 = 1.02857 ). In the diamond world that is a huge number. Simply stated, the lower the weight ratio number the bigger the stone faces up. Others have reported ( Holloway or the Cut Group???) that world diamond manufacturing has gravitated to the steep/deep combinations so much so that it is difficult to find what used to be called “normal ideal makes”. If anyone can verify the previous sentence please do so or please disregard it.

GIA’s cut grade system seems to be heavily front-weighted. Of its 5 grades, only 3 – Excellent, Very Good and Good – are usually seen. It is almost unheard of to see a Fair or Poor. I want to be clear that this is my opinion based on reliable hearsay. And again, if anyone can verify this please do so or disregard it.

To get a top grade in the AGS system the diamond has to have Ideal Polish and Ideal Symmetry to get an Ideal Cut grade. GIA’s top grade is Excellent and the stone can have either Excellent or Very Good Polish and Excellent or Very Good Symmetry. So there are more ways to get a top cut grade from GIA. Is that good or bad? In my opinion it is neither. It just is what it is, but good to know that.

Much of the information above is because we were first out with our light performance cut grading system – May 2005. GIA started cut grading standard round brilliant cuts in January of 2006. So GIA had 6 months to carefully review our system before rolling out their system. In retrospect I am glad we came out first because we didn’t have to consider possible conflicts or disparities. Or in other words there was a level of purity in our launch because no possible political ramifications could be considered – and there is always politics. And some of our information flew in face of conventional wisdom – very small tables, shallower crown angles with deeper pavilion angles and measuring the effects of painting and digging to name three.

There is the “We have always done it this way” statement. Probably should be placed in the overcoming inertia cubbyhole.

I’ll look into the publishing of our fees on our website. I can confirm that our prices are tiered and calculated on volume. I’m pretty sure that GIA also has volume pricing.

We have never graded fancy color diamonds. The cost of color master stones and the equipment to accurately determine origin of color is sky high and above our means.

Lastly I would like to comment on human nature in general. Some people just love to criticize but frequently don’t bring anything to the table in the way of a solution. So I would urge all of us to keep that in mind and try to make our entire industry better. Call it a New Year’s Resolution if you like.

Something will have to happen for AGSL to become bigger. I have no idea what that something might be. I do know that we are a highly respected niche laboratory and I am proud to be part of the team. I have always loved MGM Movie Studio’s motto “Ars Gratia Artis” which means “Art For Art’s Sake”. It is written above the roaring lion. For us “Good Work for Good Work’s Sake” is sufficient and satisfying.

That’s all I can think of for the moment. Lurking at Pricescope through the years has been illuminating because you can see growth, understanding and knowledge develop over time, in spite of the occasional back biting, disrespect and hidden agendas. My hat’s off to all of the people who have posted to this interesting thread.

Sincerely,
Peter Yantzer

 

[lagori]

That is a very interesting message from Peter.

On his statement that "Something will have to happen for AGSL to become bigger. I have no idea what that something might be." In my opinion, it has to start witht he consumer. Specifically, with educating the consumer. I appreciate and respect their motto of doing good work for the sake of good work. However, this is just like taking market share from competition, in business. If AGSL can develop a clear value proposition for using their services over those of GIA (competitors) to consumers and actually get the message across by actively and extensively communicating with consumers (marketing) and educating them, then eventually consumers will demand from jewelers that diamonds that they sell have AGS reports as opposed to GIA reports. That demand will at some point translate into increased supply as jewelers will have to start sending more stones to AGSL for grading. Right now, if you take a look at absolute majority of websites advising consumers on diamond shopping, they all say that a diamond has to have a report from GIA. Most people shop for diamonds only a few times in their life and given an option they pick a "safe choice." Hence, the status quo.

Also, some major online sellers don't particularly care about presenting the two labs in equally beneficial light. I am not saying that they do so on purpose. It probably has to do with the fact that, as someone has mentioned, most of their gemologists obtained their education from GIA.

For example, here is how James Allen website describes these two lab certifications:

- GIA Certified Diamonds
GIA is the number one, most respected laboratory in the world. Any diamond submitted to GIA is ensured to have reliable and consistent grading.
...KEYWORDS: number one, most respected, reliable, consistent. These are the words that an average consumer can understand and relate to.

- AGS Certified Diamonds
AGS is known through out the diamond industry as grading top-notch ideal cut round diamonds. Their high standards surpass those of any other grading laboratory when considering color and clarity as well as cut.
...This is the description that a diamond professional can appreciate, but will go right over the head of an average consumer.

Here is how BlueNile descibes GIA and AGS lab certifications:

- GIA Diamond Grading Report
The GIA set the standard for diamond grading and gemological identification, and their grading system serves as the international gem and jewelry industry's benchmark credentials
...KEYWORDS: set the standard, industry's benchmark

- AGSL Diamond Quality Document
The AGSL uses a diamond grading system that ranks cut, color, and clarity on a zero to ten scale, with zero signifying the rarest and most desirable and ten indicating the least desirable.
...This description says absolutely nothing about the value of AGSL certification.

If you were a consumer, which certification would you demand after reading their descriptions on the BlueNile website?

So, Peter and AGS can start by working with major shops to ensure that their websites clearly describe benefits of obtaining AGSL certification!

On a lighter note, if you worked for a company and wanted a promotion or a pay increase, would you just sit there quietly in your cubicle hoping that your boss will notice your good work or would you march to your boss's office and tell him: "Here is what I have done for the company and here is why I deserve a promotion/pay increase"? That's what AGSL should do!

 

[Regular Guy]

Re Peter's statement:

In its cut grading system, GIA’s weight ratio, though not published but reverse engineered, seems to be in the neighborhood of 8%. The AGS weight ratio standard is 5%. This gives manufacturers an opportunity to save approximately 2.8% more weight from certain pieces of rough ( 1.08/1.05 = 1.02857 ). In the diamond world that is a huge number. Simply stated, the lower the weight ratio number the bigger the stone faces up. Others have reported ( Holloway or the Cut Group???) that world diamond manufacturing has gravitated to the steep/deep combinations so much so that it is difficult to find what used to be called “normal ideal makes”. If anyone can verify the previous sentence please do so or please disregard it.

I'm hoping someone here can re-speak in a constructive way for us.

I infer that he is speaking very modestly, and making a financial argument for a consumer to ask themselves...if really good performance is as GIA says it is, it's an odd coincidence that the numbers are very conveniently advantaged to the manufacturer. Since we use a different criteria for ideal, and one that will penalize you for weight to get it, better think hard before you bet on the cheaper option.

BTW, despite his lack of pointing directly to what I understand to be the fundamental question of reliably optimized performance with AGS over GIA in 0 vs ex, that is how I see the primary tradeoff.

The idea of a back up is some sort of public policy lingo, I think, that no one would adopt unless asked by a government, I think, to justify oneself, so it's at least interesting, and might satisfy somebody. It's obviously enough otherwise akin to be like being an understudy for a play, or some such...as matte as you can be vs glossy as in photography. As I say, altogether, the comments are very muted...but I hope someone will comment and restate better my quoted section above.




Ira Z.

P.S. edited to add...re Lagori's observations...I think the JA description is actually right on, and fairly helpful. But, I agree, Blue Nile is doing AGS no favors. Maybe they should offer to take them to lunch.

 

[Karl_K]

I'm hoping someone here can re-speak in a constructive way for us.

If you cut the heaviest combo that gets GIA Ex cut grade from a piece of rough it will be up to 2.8% heavier than the heaviest AGS0 combo assuming that the rough supports both.
You would also have to be more careful with polish and symmetry with the AGS combo to get the grade.
With improvements in tooling and more importantly process ID polish and ID symmetry is not as hard to do as it used to be.

By cutting GIA Ex steeper/deeper range the average recovery from a given lot of rough also goes up compared to AGS0 if the rough supports it.
That is huge for cutters.

Bottom line some rough can not be economically cut into AGS0 vs GIA Ex.
Which would you cut .99(ags0) or 1.01(gia EX)?
If you want to stay in business you cut 1.01 if at all possible.

 

[denverappraiser]

Bottom line some rough can not be economically cut into AGS0 vs GIA Ex.

Agrreed. But some can. For some it's a path that leads to more money for both the cutter and the dealer(s) and a better stone for the final customer. Is it more than 2%?

 

[affguy]

I'm hoping someone here can re-speak in a constructive way for us.

If you cut the heaviest combo that gets GIA Ex cut grade from a piece of rough it will be up to 2.8% heavier than the heaviest AGS0 combo assuming that the rough supports both.

Just so I understand the issue...doesn't this also mean that for a given weight, the AGS0 will face up larger (in addition to having a more distinguished evaluation of light performance)? If so, then the question can be easily reduced to what's important to the consumer, visual size and performance, or weight, the former coming from AGS and the latter from GIA. Sure, there might be 3% weight loss, but when you get more than a couple of points from a significant (albeit artificial imo) break, a premium for AGS0 should be more than sufficient to make up for the weight loss.

 

[Serg]

re:In its cut grading system, GIA’s weight ratio, though not published but reverse engineered, seems to be in the neighborhood of 8%. The AGS weight ratio standard is 5%. This gives manufacturers an opportunity to save approximately 2.8% more weight from certain pieces of rough ( 1.08/1.05 = 1.02857 ). In the diamond world that is a huge number. Simply stated, the lower the weight ratio number the bigger the stone faces up. Others have reported ( Holloway or the Cut Group???) that world diamond manufacturing has gravitated to the steep/deep combinations so much so that it is difficult to find what used to be called “normal ideal makes”. If anyone can verify the previous sentence please do so or please disregard it.

AGS can not compete with GIA if AGS gives just same type information in report as GIA does.
AGS needs add at least information about spread. Something have to be different otherwise consumers demands only GIA reports .
AGS needs create unique proposition . Without unique proposition the investment in Branding is helpless because GIA brand is too strong , GIA has much more money for promotion , GIA has big alumni association.
Is it so difficult to add spread and create good education program for sellers with clear explanation What spread is and Why spread information is important for consumer?

 

[Regular Guy]

JP maybe?

I'm sorry, I still don't really get it.

I really don't think the value added proposition, with deference to Serg, is one seeking info not already available. I think the fact that a different criteria is in place to get a zero is sufficient, and this is the current state of the art.

Maybe someone else wants to say this yet again a different way.

I have a feeling my original re-statement, while maybe being true, is not holding the end of the stick that is most provocative.


Ira Z.

 

[yssie]

This is a fascinating thread! Neil you list some excellent ideas, and Peter Yantzer's thoughts make for an interesting read!


My 2c - I find the AGSL reporting system confusing, and I'm a lot more invested in learning more than the average diamond shopper. There's a lot to be said for KISS - or, in this case, GIA's so-basic-anyone-can-understand-it system -
-- Full report for >1ct with plot diagram. Reports for RBs include a proportions-based cut grade, reports for other shapes do not.
-- Pocket report for <1ct without inclusions diagram. Reports for RBs include a proportions-based cut grade, reports for other shapes do not.


AGSL's variety -
(and this is my understanding, if I'm wrong about something please correct me!)

-- The Platinum DQD - only one with the printed ASET simulation of light perfomance analysis. Grades from "Ideal 0"-10. Available for RBs/princesses/ECs/cushions/ovals. Stones must earn "Ideal" in sym/pol to be granted the "Ideal 0" cut grade.
-- The DQD - light performance analysis but no printed ASET, grades from "Ideal 0".
-- The DQC - which I'd never heard of before looking at the website ten minutes ago. This specifies that the stone was bought from a merchant who participates in the AGS, whether proportions-based or light performance analysis based cut grade not specified but I assume the latter based on grades from "Ideal 0".
-- The Gold DQR - proportions-based cut grade based on averages like GIA (GIA rounds as well). Grades from "Ideal" rather than "Ideal 0", slightly different (and totally confusing) terminology. Stones may earn "Excellent" in sym/pol and still be granted the "Ideal" cut grade. Any links to proportions charts?
-- The DQR - for diamonds with less-than-"ideal" cut/pol/sym, or proprietary cut diamonds. This report does not include a cut grade.
-- The DQA - for <1.99ct, light performance analysis and cut grades from "Ideal 0" but no inclusions diagram or printed ASET simulation.

But... why so many reports? If someone wants to know that their stone was purchased from a member of the AGS he/she can look at his/her receipt - this information is irrelevant in grading the stone. What sets AGSL apart from GIA IMO is A) the commitment to objective study and presentation of light performance, and B) making it easy for the consumer to spot the cream of the crop - not burying everything in a giant top cut grade range that includes all sorts of stuff. The Gold DQR is in direct opposition of this commitment, as is playing coy with extra report types to obfuscate the fact that less-than-"ideal" stones are less-than-"ideal" as with the regular DQR for rounds/princesses/ECs/cushions/ovals (if this report is even available for all these shapes). Proprietary cuts other than RBs and princesses can also come with the Platinum DQD, though the DQR is also listed as suitable for proprietary shapes...


From my perspective - only the DQDs are worthy of special accolade. Problem is, in coming across a non-DQD report a new customer might never realise that there are all these differences and just assume "Ideal" cut grade from AGSL is ideal cut grade from AGSL, or they might discover that there are differences and feel cheated to learn that their report isn't the "respected" one...
Pick one and have confidence in it. Stay true to the performance-based light return system and don't dilute that conviction with other reports/systems/methodologies - plenty of people believe in it, and a cohesive brand is much easier to promote!

 

[Serg]

This is a fascinating thread! Neil you list some excellent ideas, and Peter Yantzer's thoughts make for an interesting read!


My 2c - I find the AGSL reporting system confusing, and I'm a lot more invested in learning more than the average diamond shopper. There's a lot to be said for KISS - or, in this case, GIA's so-basic-anyone-can-understand-it system -
-- Full report for >1ct with plot diagram. Reports for RBs include a proportions-based cut grade, reports for other shapes do not.
-- Pocket report for <1ct without inclusions diagram. Reports for RBs include a proportions-based cut grade, reports for other shapes do not.


AGSL's variety -
(and this is my understanding, if I'm wrong about something please correct me!)

-- The Platinum DQD - only one with the printed ASET simulation of light perfomance analysis. Grades from "Ideal 0"-10. Available for RBs/princesses/ECs/cushions/ovals. Stones must earn "Ideal" in sym/pol to be granted the "Ideal 0" cut grade.
-- The DQD - light performance analysis but no printed ASET, grades from "Ideal 0".
-- The DQC - which I'd never heard of before looking at the website ten minutes ago. This specifies that the stone was bought from a merchant who participates in the AGS, whether proportions-based or light performance analysis based cut grade not specified but I assume the latter based on grades from "Ideal 0".
-- The Gold DQR - proportions-based cut grade based on averages like GIA (GIA rounds as well). Grades from "Ideal" rather than "Ideal 0", slightly different (and totally confusing) terminology. Stones may earn "Excellent" in sym/pol and still be granted the "Ideal" cut grade. Any links to proportions charts?
-- The DQR - for diamonds with less-than-"ideal" cut/pol/sym, or proprietary cut diamonds. This report does not include a cut grade.
-- The DQA - for <1.99ct, light performance analysis and cut grades from "Ideal 0" but no inclusions diagram or printed ASET simulation.

But... why so many reports? If someone wants to know that their stone was purchased from a member of the AGS he/she can look at his/her receipt - this information is irrelevant in grading the stone. What sets AGSL apart from GIA IMO is A) the commitment to objective study and presentation of light performance, and B) making it easy for the consumer to spot the cream of the crop - not burying everything in a giant top cut grade range that includes all sorts of stuff. The Gold DQR is in direct opposition of this commitment, as is playing coy with extra report types to obfuscate the fact that less-than-"ideal" stones are less-than-"ideal" as with the regular DQR for rounds/princesses/ECs/cushions/ovals (if this report is even available for all these shapes). Proprietary cuts other than RBs and princesses can also come with the Platinum DQD, though the DQR is also listed as suitable for proprietary shapes...


From my perspective - only the DQDs are worthy of special accolade. Problem is, in coming across a non-DQD report a new customer might never realise that there are all these differences and just assume "Ideal" cut grade from AGSL is ideal cut grade from AGSL, or they might discover that there are differences and feel cheated to learn that their report isn't the "respected" one...
Pick one and have confidence in it. Stay true to the performance-based light return system and don't dilute that conviction with other reports/systems/methodologies - plenty of people believe in it, and a cohesive brand is much easier to promote!

well done. very clear answer to question :"What's wrong with AGS Lab?"
too many contradictive reports , weak strategy , very bad Brand recognition. If AGS Board and management have so week ASGL Brand recognition( at least in cut grading ) , how do consumers could have good AGSL brand ?recognition.

 

[Texas Leaguer]

It's kind of amazing to me that in a thread this long I can't say that I really disagree with anything. Perhaps a few ideas that I am not quick to embrace, but really alot of very well meant and constructive comments. Maybe it's because we are all part of the choir, and we're looking for postitive solutions rather than criticizing poor performance.

I found Peter's comments to be refreshingly frank and I appreciate his openness. I do think the real challenge is GIA's inertia in the market place and the economics associated the combination of both that inertia and the more forgiving cut grading parameters of the GIA approach. Given those realities I can understand Peter's rather fatalistic summation that something big is going to have to happen for AGSl to really break through the current barriers. And that scenario is not really a very pleasant one to contemplate.

Despite that, I am not so pessimistic. I do feel, as several have suggested, that through a combination of increasing visibility and more focus on consumer education the value added by AGSL can be be imparted to the market and demand can be built. For that to happen AGSL will need to continue to innovate and those of us who understand the benefits they bring to the market will have to do a better job of messaging those benefits to the consumer.

AGSL understands the need to supply additional information to the customer that is actionable and useful, over and above what GIA provides. The addition of the ASET light map to the platinum cert is an example. Perhaps the weight ratio metric would be a good addition as meaningful differentiator.

I think it is clear from Peter's comments that AGSL understands the situation quite well and they are actively listening to constructive feedback. I also see them already moving in the direction of many of the suggestions in this thread.

As a "Kaizen" approach to the situation, if we want help build demand for AGSL services, we can all ask ourselves what little things we can do that will have an impact. It's amazing what can happen if alot of folks take a lot of small steps in the same direction.

 

[denverappraiser]

Yssie,

Thanks for your thoughts. There is at least one more type, the 'consultation', which has a plot but no cut grade and is a little 3x3 inch format. It's the cheapest document they make. I think that's 6 flavors. If you include variations that have come and gone in the last decade I think it's over 10. I agree, that's too many and too complicated. I think the DQC came about from internal politics at AGS and it was adopted over the opposition of the lab staff (and me) so that one is probably not negotiable. The nicest thing I can say for it is that it's harmless and, for all practical purposes it's just extra packaging for the Platinum to help promote some of the AGS member stores. I think the Gold came in precicely because of the competitive issues we're talking about and your observation that it's an attempt to make non-0 stones look better on paper without actually fessing up to the 'real' AGS grade is dead on and it does feel a bit disingenous when you phrase it that way. The DQR is necessary for the stones that don't have a cut grade like pears and hearts so I wouldn't pick on that one. It's necessary. GIA and everyone else does that too, they just don't give it a different name. I don't think I've ever even seen a DQA and you're guess is as good as mine for what the point is. It's cheaper to prepare and it seems like it's intended as a GIA-dossier only different.

 

[Karl_K]

I think the DQC came about from internal politics at AGS and it was adopted over the opposition of the lab staff (and me) so that one is probably not negotiable.

I think that also may be holding some dealers back, the labs association with the the society which some jewelers might feel they are feeding their competition by pushing/using AGSL reports.
A Jeweler tells someone AGS/AGSL is great then they see the sign that he/she cant display in the competition's window.
The AGS/AGSL connection is something that at times has bugged me.

 

[denverappraiser]

Karl,

Interesting comment. The DQC is no more or less than a Platinum report that comes with an additional guarantee made by the selling jeweler that it is as described. ANY jeweler can do that with anything they sell and any good jeweler already does. The difference is a slickly produced document with AGSL assisting in production and with their name on it as well as the jeweler’s. I agree it’s sort of a weird thing for them to do but I wouldn’t go so far as to call it harmful. As far as I can tell, AGSL is assuming no additional liabilities with it and, to the extent that it helps their clients, in this case some of the AGS members, to sell more AGSL services, I don’t really have a problem with it any more than I have a problem with establishing a cut grade on specialty cuts that are sold through a limited dealer network (like the AVC at GOG). It costs them money to design and implement but, hopefully, it produces a stream of future revenue as well. Presumably some accountant worked out that it was worth the work. Hopefully they’re correct but at least it’s not obviously a bad idea but I don't see it as a slap in the face to other clients who don’t sell that particular design or use that particular format for their guarantee. Why the DQC is limited to the AGS retail members is, for me, a curious question and that’s the political one. I see no benefit to the lab for this policy beyond the fact that their major stockholder wants it and I assume they’re charging enough that they can make a few bucks at it. I suppose that’s a good enough reason to do it. Presumably they would cut grade an AVC from anyone who came up with one and it’s things outside of their control that limits this service to only one client (note to readers: AVC stands for August Vintage Cut and it’s a patented design belonging to one source. It’s not AGSL that prevents others from making them, it’s the courts). The fact that they are willing to go above and beyond to help their clients is something I think they (and I) see as a feature, not a problem.

That said, perception sometimes becomes reality and a perceived separation between AGSL and AGS could certainly be done if they decide it’s desirable. It's clear from comments here and other threads that the vast majority of people aren't aware that there's a difference at all. Thanks for the idea.

 

[Ravinmad]

I work for a multinational corporation and we often bring up an interesting idea, or subject and I think its true. "Preception is Reality" and it plays a part here I agree with you Neil

I would hope AGSL would consider/market or set some criteria and have verified or alloted "Hearts and Arrows" stones or other signiture line "superideal" cuts, I mean ACA stones are the top grade at WF, and the expert selection is just below, maybe a AGS HA 2 qualification? Explain how this is just outside the mark or standards or something like that but show its very or quite close, also add a score something akin to the HCA, but its just an idea from a tech/knowlege .

I see this as a area or segment of that market thats pretty much an open season right now. It can even have H&A levels of various degrees based upon the variation of the idea combinations or how far off the mark it is.

I know it all comes down to the rough, and maximum return on the dollar but you have to give and deliver the value in the certification. I doubt i would buy an AGS rated RB stone that does not have a Platinum report. Its literally a fingerprint on your documentation. I "precieve" this as worth more then a GIA certificate. looking at this fact and realizing I may very well pay a premium for it.

Right now, this period of time and the past several months I've been shopping for a stone for the love of my life and my other half. I shop very hard, Looking at the best .5-.6 stone I can afford for the funds I have available, because I refuse to go into debt and will not charge or use credit for this purchase. This said, someone has to create the precieved value in me getting a .50 H Vs2 for X dollars versus the .58 G SI1 and as folks from Missouri say, "Show me!" Why its better. I think thats why IRA at Truthabout is so successful, he goes off of images and what people can see or understand.

Lastly, I dislike the lack of information on the dossier reports and other reports "like" them and can only effectively shop these stones when an image of the stone is presented or available on the various online outlets that offer them. To JA, WF, BGD, GOG, and anyone else I may have overlooked I appreciate the distance you go to "Show Me" what it is I'm looking at so that when I buy the diamond this month, it will be everything i expect it to be and have "seen" the value before it hits my doorstep.

Thank you,
Doug aka Ravin

 

[Garry H (Cut Nut)]

I work for a multinational corporation and we often bring up an interesting idea, or subject and I think its true. "Preception is Reality" and it plays a part here I agree with you Neil

I would hope AGSL would consider/market or set some criteria and have verified or alloted "Hearts and Arrows" stones or other signiture line "superideal" cuts, I mean ACA stones are the top grade at WF, and the expert selection is just below, maybe a AGS HA 2 qualification? Explain how this is just outside the mark or standards or something like that but show its very or quite close, also add a score something akin to the HCA, but its just an idea from a tech/knowlege .

I see this as a area or segment of that market thats pretty much an open season right now. It can even have H&A levels of various degrees based upon the variation of the idea combinations or how far off the mark it is.

I know it all comes down to the rough, and maximum return on the dollar but you have to give and deliver the value in the certification. I doubt i would buy an AGS rated RB stone that does not have a Platinum report. Its literally a fingerprint on your documentation. I "precieve" this as worth more then a GIA certificate. looking at this fact and realizing I may very well pay a premium for it.

Right now, this period of time and the past several months I've been shopping for a stone for the love of my life and my other half. I shop very hard, Looking at the best .5-.6 stone I can afford for the funds I have available, because I refuse to go into debt and will not charge or use credit for this purchase. This said, someone has to create the precieved value in me getting a .50 H Vs2 for X dollars versus the .58 G SI1 and as folks from Missouri say, "Show me!" Why its better. I think thats why IRA at Truthabout is so successful, he goes off of images and what people can see or understand.

Lastly, I dislike the lack of information on the dossier reports and other reports "like" them and can only effectively shop these stones when an image of the stone is presented or available on the various online outlets that offer them. To JA, WF, BGD, GOG, and anyone else I may have overlooked I appreciate the distance you go to "Show Me" what it is I'm looking at so that when I buy the diamond this month, it will be everything i expect it to be and have "seen" the value before it hits my doorstep.

Thank you,
Doug aka Ravin

I have yet to meet a Lab Director who would buy a diamond based on his own grading report without seeing the diamond. (I asked another one yesterday and got the same response).

There is a huge amount of business at stake. and when you discuss AGS - a huge amount of 'club politics'.

It is sad though because AGS had an iconic status and appears to have lost ground. They could have been the top niche lab in the world for discerning diamond buyers. This could have been much more than 5% of diamonds by value.

 

[Ravinmad]

In humor, I would like to see a book on world diamond politics, but I'm afraid I would get a picture book that sometimes I swear you could substitute any of the big groups and the "camps" or "Labs" just like Chevy vs Ford or Bud vs Miller vs Coors but with much less ad campaigns and no stickers across a NASCAR with something like "Got Platinum?" and a Aset image of a stone next to it


all joking aside, AGS Labs needs a face for the pubic, someone who like diamonds, wears them, has the person talking about them on the red carpet and mention X diamonds, all AGS O stones in that necklace. Find the right person, a public figure who's not over the edge and start them on the way.

Years later, people still remember the wendys commericial grandma who said "Where's the Beef?"

Well, where's the diamond isnt getting said right now.

 

[Garry H (Cut Nut)]

all joking aside, AGS Labs needs a face for the pubic, someone who like diamonds, wears them, has the person talking about them on the red carpet and mention X diamonds, all AGS O stones in that necklace. Find the right person, a public figure who's not over the edge and start them on the way.

Years later, people still remember the wendys commericial grandma who said "Where's the Beef?"

Well, where's the diamond isnt getting said right now.

John Pollard?

 

[oldminer]

This is thought provoking thread. There is nothing wrong with AGSL except the limited degree of market penetration they have made. You don't see many cut grade 1, 2 3, or 4 stones offered. The GIA is in an enviable position, markets itself strongly and re-inforces its brand with very clear marketing. A lot is in the hands of consumers who would get more AGSL documents on diamonds if they asked more often for them in preference to GIA reports. Diamond dealers will do what consumers demand, but they will not change unless market forces make it beneficial for them to change. The strongest market force in our business arena is the consuming public.

However, my opinion is that a lab that is going to surpass GIA must adopt the latest technological advances in diamond grading, not only in light behavior, but in color grading, clarity grading, physical measurement, and uv measurement. By doing so, the adopting lab will take a quantum leap beyond the status quo, attract the modern consumer with a powerful message, be able to give very rapid turn around on reports, and be able to save a lot of labor costs with the high degree of efficiency and automation being offered. Such a huge change from a virtually subjective grading standard to a far more objective and scientific approach will give the lab that goes into this new era of grading a strong and highly focused message and brand. It will also improve the consistency of its grading far beyond what a human only grading lab can possibly offer. A lab that is capable of grading any shape, any cut, and supply an objective measurement of all characteristics would have the capability of knocking GIA off its lofty pedestal unless GIA adopts such a strategy themselves. No doubt, they are well aware of how to manage their own future success, too.

 

[ChrisES]

I'm hoping someone here can re-speak in a constructive way for us.

If you cut the heaviest combo that gets GIA Ex cut grade from a piece of rough it will be up to 2.8% heavier than the heaviest AGS0 combo assuming that the rough supports both.

Just so I understand the issue...doesn't this also mean that for a given weight, the AGS0 will face up larger (in addition to having a more distinguished evaluation of light performance)? If so, then the question can be easily reduced to what's important to the consumer, visual size and performance, or weight, the former coming from AGS and the latter from GIA. Sure, there might be 3% weight loss, but when you get more than a couple of points from a significant (albeit artificial imo) break, a premium for AGS0 should be more than sufficient to make up for the weight loss.

Where did the price breaks first come from anyway? Are they a Rap invention or did they predate it? I understand the efficiency of having standardish systems, and I understand that larger diamonds are rarer and should be more valuable per carat, but the breaks are HUGE and really are arbitrary. In this age of telecoms and technology, couldn't there be a more nuanced scale?

I understand this isn't going to happen, I'm just musing / venting. Also, digression.

 

[Ravinmad]

This is thought provoking thread. There is nothing wrong with AGSL except the limited degree of market penetration they have made. You don't see many cut grade 1, 2 3, or 4 stones offered. The GIA is in an enviable position, markets itself strongly and re-inforces its brand with very clear marketing. A lot is in the hands of consumers who would get more AGSL documents on diamonds if they asked more often for them in preference to GIA reports. Diamond dealers will do what consumers demand, but they will not change unless market forces make it beneficial for them to change. The strongest market force in our business arena is the consuming public.

However, my opinion is that a lab that is going to surpass GIA must adopt the latest technological advances in diamond grading, not only in light behavior, but in color grading, clarity grading, physical measurement, and uv measurement. By doing so, the adopting lab will take a quantum leap beyond the status quo, attract the modern consumer with a powerful message, be able to give very rapid turn around on reports, and be able to save a lot of labor costs with the high degree of efficiency and automation being offered. Such a huge change from a virtually subjective grading standard to a far more objective and scientific approach will give the lab that goes into this new era of grading a strong and highly focused message and brand. It will also improve the consistency of its grading far beyond what a human only grading lab can possibly offer. A lab that is capable of grading any shape, any cut, and supply an objective measurement of all characteristics would have the capability of knocking GIA off its lofty pedestal unless GIA adopts such a strategy themselves. No doubt, they are well aware of how to manage their own future success, too.

I ilke it, maybe we can consider the ISO 9000, 9001, 14001, and then even this which i found, interesting it seems to have lost steam in 1995.........hmmmm

ISO/TR 11211:1995
http://webstore.ansi.org/RecordDetail.aspx?sku=ISO/TR+11211:1995
[/url]http://www.freestd.us/soft/27765.htm
http://www.freestd.us/downpage.asp?id=27765

 

[diagem]

Where did the price breaks first come from anyway? Are they a Rap invention or did they predate it?

Nope, not a Rap invention at all but there are similarities to the price-breaks as described in "Taverniers 1676 Travels in India".
Actualy surprising...

 

[diagem]

However, my opinion is that a lab that is going to surpass GIA must adopt the latest technological advances in diamond grading, not only in light behavior, but in color grading, clarity grading, physical measurement, and uv measurement. By doing so, the adopting lab will take a quantum leap beyond the status quo, attract the modern consumer with a powerful message,...

David you keep mentioning all these latest technologies..., can you elaborate more..., I have no knowledge of any "tested & proved" novo technology which can accurately and repeatedly grade either color nor clarity. Even measurements are not fully accurate with the margins of error let alone physical symmetry (eg meeting points of facet junctions).

Since you keep mentioning these 'latest technologies' I would appreciate if you could show some live examples or statistics?

 

[Karl_K]

However, my opinion is that a lab that is going to surpass GIA must adopt the latest technological advances in diamond grading, not only in light behavior, but in color grading, clarity grading, physical measurement, and uv measurement. By doing so, the adopting lab will take a quantum leap beyond the status quo, attract the modern consumer with a powerful message,...

David you keep mentioning all these latest technologies..., can you elaborate more..., I have no knowledge of any "tested & proved" novo technology which can accurately and repeatedly grade either color nor clarity. Even measurements are not fully accurate with the margins of error let alone physical symmetry (eg meeting points of facet junctions).

Since you keep mentioning these 'latest technologies' I would appreciate if you could show some live examples or statistics?

Dave is affiliated with imagem so that is what he is talking about.
http://imageminc.com/?page_id=212

 

[diagem]

However, my opinion is that a lab that is going to surpass GIA must adopt the latest technological advances in diamond grading, not only in light behavior, but in color grading, clarity grading, physical measurement, and uv measurement. By doing so, the adopting lab will take a quantum leap beyond the status quo, attract the modern consumer with a powerful message,...

David you keep mentioning all these latest technologies..., can you elaborate more..., I have no knowledge of any "tested & proved" novo technology which can accurately and repeatedly grade either color nor clarity. Even measurements are not fully accurate with the margins of error let alone physical symmetry (eg meeting points of facet junctions).

Since you keep mentioning these 'latest technologies' I would appreciate if you could show some live examples or statistics?

Dave is affiliated with imagem so that is what he is talking about.
http://imageminc.com/?page_id=212

I am aware David is affiliated with them but till this day I never saw any statistics or heard feedbacks on their ability.
I would imagine GIA and/or AGSL would have at least pilot this multitask grading machine.
If it is as Imagem claims it is..., it would solve GIA's (and the industry's) recent headaches which they are experiencing with the overload.

 

[denverappraiser]

Perhaps a 'What's wrong with Imagem?' thread might be interesting as well but I think it's a distraction here. I agree with David that AGSL should make a point to stay on the cutting edge technologically and that the fact that they seem to be fairly nimble, as evidenced by the creative use of QR codes mentioned above, is one of their competitive advantages.

 

[denverappraiser]

It is sad though because AGS had an iconic status and appears to have lost ground. They could have been the top niche lab in the world for discerning diamond buyers. This could have been much more than 5% of diamonds by value.

That's a good explanation of why I started this thread. Perhaps it shouldn't be stated in the past tense. Can it STILL be much more than 5% of diamonds by value?