This is a topic that Ollie and I (and others) have dug into a bit. See https://github.com/Olical/conjure/issues/53

I've tried a few different colorizing vim plugins, and I've ended up with vim-hexokinase, which seems to me like the highest quality plugin, however, it doesn't yet support colorizing ANSI escape codes. There is an issue open for that here: https://github.com/RRethy/vim-hexokinase/issues/65 I reaaally hope that it gets added at some point! The idea of having to install a separate plugin just to colorize ANSI escape codes bums me out. I haven't tried the other plugins mentioned in the above issues in a while. I wonder if maybe they've gotten better recently.

I keep kaocha running in a Neovim terminal buffer with --watch and it colorizes the diffs just fine.

I guess you’re referring to running the tests explicitly with the Conjure command.