NEW YORK (CNN/Money) -
Big rocks are in -- and I'm not just saying that because my boyfriend will read this.
The average price for a diamond engagement ring has hit an all-time high of $2,600, and while the one-carat diamond has become the standard in popular culture, even larger diamonds are quickly gaining steam.
Just ask Paris Hilton, who's sporting a 24-carat emerald-cut diamond engagement ring.
Sales of one-carat diamonds have jumped about 80 percent since 1996, according to The Wall Street Journal, and at luxury jeweler Cartier, where engagement rings start at a cool $4,000 and zoom quickly into the millions, big bling rings are more popular then ever.
"Diamonds between one and two carats are the most popular, however stones up to five carats have become much more popular for engagements in the past several years," said Karl Tapps, assistant manager at the Cartier Fifth Avenue boutique in Manhattan.
And with engagement ring sales totaling $4.5 billion, jewelers have something to smile about. And so do fiancées.
Thinking outside the little blue box
With its signature blue box and reputable name, Tiffany & Co. (Research) remains one of the more notable retailers of diamond engagement rings.
For the first quarter ended in April, the New York-based luxury jeweler said profit was up 8.8 percent from the year earlier. Last year, U.S. retail sales jumped 14 percent, helped by sales of big rocks.
"The most meaningful growth was in diamond jewelry at higher price levels," Mark Aaron, vice president of investor relations said in a statement when the company reported first-quarter results.
The company said sales of diamond rings over three carats, called "statement" rings, are running strong as are sales of diamond-encrusted "celebration" rings that run from $5,000 to $12,000 a piece.
But as suitors seek to impress their soul mates with larger -- but still affordable -- rings, luxury retailers such as Tiffany's have felt ever-stiffer competition from companies like Blue Nile Inc. (Research) and Zale Corp. (Research)
At Blue Nile, diamond engagement rings account for 75 percent of the online jeweler's sales.
With prices often 20 to 40 percent less than a luxury jeweler's, the company said it cuts costs and boosts sales by operating exclusively online without the need for brick-and-mortar stores and their associated costs.
The online jeweler reported net income in the first quarter ended in April jumped 36.6 percent while sales grew 23.3 percent, largely on the strength of its engagement-ring business.
Zale's, the largest specialty retailer of jewelry in the U.S., said bridal jewelry accounts for 40 percent of the company's total sales, or about $800 million.
The jeweler reported revenue rose 7 percent for the third quarter ended April 30 and net income jumped 27 percent, noting that the bridal business "did very well."
"The bridal business stays fairly consistent," said David Sternblitz, Vice President and Treasurer of Zale's. "It's not really impacted by the economy."
And it doesn't end after the "I do." Stores count on additional sales on the birthdays and anniversaries that follow the wedding. "It really does give the opportunity to establish that bond with the customers," Sternblitz said.
And that means there's enough love to go around.
In fact, shares of Tiffany's, Zale's and Blue Nile have all enjoyed nice gains this year. Tiffany's stock has rallied about 6 percent while Zale's and Blue Nile are up 12 percent and 21 percent, respectively, while the broader market is little changed.
What's love got to do with the economy?
No matter where the economy is headed, people will continue to fall in love and get engaged. "The diamond engagement ring has such a unique symbolic meaning in our culture that few factors, including the economy, have any effect on purchases," Cartier's Tapps said.
"It is safe to assume that there is some price sensitivity, but the diamond engagement ring isn't going anywhere," said John Baird, a diamond and jewelry expert. And that could mean a very happy future for diamond ring sellers.
But Baird has a word of caution for buyers caught up in the haze of love and possibility: "It's not romantic to go into debt."
So for all the guys out there reading this -- before you put everything into buying that big rock, consider putting some cash into the jeweler's stock.
Your sweetheart will appreciate that you are banking on your future, for better or for worse.
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