I use gems differently depending on my safe files and challenges.
On my Story Mode file, I mark nichelings who have Home Island Immunity with the orange gem to symbolize Adam. That way I can make sure I don't run out of nichelings in Adam's bloodline. I also mark breeding pairs.
On my Kingdoms file, I have five separate kingdoms, each with their own gem colors:
Blue = Classic Kingdom [leadership passed through fathers]
Blue eyes, digger paw, velvet paw, antlers, short snout, normal ears, medium body, fluffy tail, normal hind legs.
Green = Pacifistic Kingdom [no true leadership; everyone gets along]
Green eyes, double gather paw, poison fangs, round ears, spiky body, spots, normal hind legs.
Yellow = Justice Kingdom [they go after the trouble-makers and carnivores and don't like hybrids. Leader is the eldest.]
Yellow eyes, double runner legs, ram horns, cracker jaw, round ears, big body, hammer tail, normal hind legs.
Orange = Hybrid Kingdom [all are prey to them. The 'mother and father' of the kingdom run it together. They have two body types.]
Orange eyes, double bearyena legs, bearyena snout, big ears, lean body, stripes, fishing tail, bearyena hind legs.
Orange eyes, double bearyena legs, bearyena snout, big ears, water body, stripes, swimming tail, bearyena hind legs.
Pink = Amazonian Kingdom [Leadership passed on to whoever is the strongest and most beautiful.]
Violet eyes, double claws, megaloceros horns, sabertooth fangs, bearyena ears, toxic body, mask, stinky tail, normal hind legs.
Then of course there's the typical "markings for what they do" in other files in which I give gatherers green gems, scouts yellow gems, warriors pink gems, protectors orange gems, and fishers blue gems.
Though sometimes I like to mix it up and I give nichelings gem colors that blend in best with their fur colors!
When I do the Luck Challenge, all that is thrown out the window, because the dice choose the colors for me