Marginal Utility and Conspicuous Consumption

The fundamental premise of Marginalism is that the Utility of a commodity diminishes as the vitality of the need that it meets decreases.  Thus, the Utility of water diminishes as it is used to quench thirst, to cook with, to clean with, to comb hair with, etc.  But, then the method of evaluation to diamonds is inapplicable, except in an industrial context.  For, as is explained by the concept of Conspicuous Consumption, the Utility of diamonds consists in the achieving of some social staus.  Now, if Marginal Utility applies, that Utility is marginally greater or marginally less than that of some other use that diamonds serve.  But, there is usually no such second use, so, Marginal Utility is inapplicable to diamonds, and, hence, to the relation of its price to that of water.  Instead, the application of Conspicuous Consumption does explain that relation: the possession of diamonds signifies a more rarefied social status than does the possession of water, and that rarefied status is what some are willing to pay correspondingly more for.  So, Marginal Utility only distracts from a more fundamental problem--the relation between Social Utility and Vital Utility.