Couples are swapping out natural diamonds in rings for larger, cheaper lab-made ones

New York(CNN Business) Lab-grown diamonds have become so popular with consumers that some couples are asking jewelers to swap the natural diamond in their rings for a lab-created sparkler.

"Just last week we had three or four couples who've been married for a few years come to us to upgrade the diamond on the engagement ring," said Joel Klein, CEO of NY-based Ritani, an online seller of diamonds and fine jewelry, including engagement rings.

Each couple wanted to replace the natural diamond in their rings with something bigger, opting for a lab-created diamond, he said.

"It's not that we are seeing a decline in the natural diamonds business, but that growth in demand for lab diamonds is super strong," said Klein.

Ritani, which handled over 20,000 orders for engagement rings last year, deals in both natural and lab diamonds. The company maintains an inventory of over 300,000 diamonds for sale, a third of them lab diamonds. Jewelry made with lab diamonds currently now account for more than 50% of Ritani's sales,Klein said.

Several factors are fueling surging demand for man-made diamonds, industry experts say.

Man-made diamonds look exactly the same as naturally occurring ones -- the only difference is the price tag. Lab diamonds cost significantly less for a much larger stone than a mined diamond of the same size, and they appeal to the eco-conscious and ethical sensibilities particularly of Millennials and Gen Zers.

Juliet Gomes, Ritani's customer service manager, has recently helped couples upgrade to a bigger lab diamond. "If the original ring features a one carat natural diamond, now they're replacing it for a three or four carat lab-grown option for the same price or less than that original one carat original," she said.

Ritani offers its customers the option to trade their natural gem for a credit towards the upgraded stone. While some choose to swap their natural diamond for a lab-created one, others turn their original stone into another piece of jewelry, like a pendant, said Klein.

Lindsay Reinsmith, co-founder of San Francisco-based lab diamonds jeweler Ada Diamonds, said she, too, frequently sees clients who are upgrading from a mined diamond to a lab diamond in their rings.

"Not only is this a common occurrence, but we're also seeing a significant increase in clients coming to us for a lab diamond who are getting married a second time," she said. "They may have had a mined diamond for their first marriage, but they opt for lab grown for their second."

Not all customers who upgrade are focused only on switching to a larger sized stone. "They are also looking at the quality of the lab diamond and want it to have some element of sophistication to it," Reinsmith said.

First-time buyers of engagement rings are also showing a strong preference for lab grown stones.

July data showed the number of engagement rings sold that featured a manufactured diamond jumped 52% compared to last year. Meanwhile, the number of engagement rings sold with a natural diamond declined 28% in the same period.

"Consumers want to maximize their budget, they want to spend as much and get a bigger diamond with a better color and clarity.", said Edahn Golan, an industry analyst and founder of Edahn Golan Diamond Research & Data.

The average total carat weight of a lab-grown diamond for an engagement ring in the US is 1.42 carat, priced at about $3,800. That compares to an average total carat weight of 0.81 carat for a natural diamond, priced at about $4,209, said Golan.

"It's a significant difference in size that is visible to the eye and for less price," he said.

In further evidence demonstrating the acceptance of man-made diamonds, Pandora, the world's largest jewelry brand, on Tuesday announced it was launching lab-created diamond jewelry in the U.S. and Canada on Aug. 25th.

Its 33-piece collection, called Pandora Brilliance, includes rings, bangles, necklaces and earrings featuring a solitary lab-created diamond set within sterling silver, 14K yellow gold or 14K white gold.

"Lab-created diamonds are just as beautiful as mined diamonds, but available to more people and with lower carbon emissions. We are proud to broaden the diamond market and offer innovative jewelery that sets a new standard for how the industry can reduce its impact on the planet," Pandora CEO Alexander Lacik, said in a statement.