blue nile online diamond retailer

Blue Nile Inc.: World’s Largest Online Diamond Retailer

Seminar #1

April 10, 2023 Seminar #1 2

Organisation Profile

Retailer of certified diamonds and jewellery since 1999.Founded by Marc Vadon

Larger than next 3 largest online jewellers combined: Internet Retailer, 2006

Rewards & Recognitions• Internet Retailer

Best of the web company,2007

• Forbes favourite, 2000-2005

• BizRate.com Circle of Excellence Platinum Award, since 2002

• Best online jeweller – Kiplinger’s Personal Finance, Nov 2006


Strategic Vision

•To offer high quality diamonds & fine jewellery at outstanding price and to continue our leadership in our core business.

Objectives•To distribute all over European and Asian continents•To effectively manage future expansion•Continued establishment & promotion of Blue Nile brand•To continue to enhance customer experience


Business Strategy

Blue Nile – A brand to reckon with in diamonds & fine jewellery

The highest quality standards in the industry

Comprehensive education

and guidance

Unmatched diamond selection

and interactive search tools

Commitment to a superior customer

experience


Porter’s Five ForcesThreat of substitutes – EBay

Threat of new competitors – Whiteflash.com

Sustainable competitive advantage – Competitive pricing, Wide network of

Suppliers

Bargaining power of buyers - Displaced decision-making

Bargaining power of suppliers - They do their own diamond cutting and polishing,

jewellery crafting and distribution


Ethical PracticesEnsure that gold & metals come from suppliers that meet

the highest human rights, social, and environmental criteria.

Engage suppliers to influence the sourcing of gold products.

Research mining, refinement, and manufacturing practices of gold that moves through the supply chain.

Give preference to suppliers that source gold from mines that observe high standards of environmental stewardship.

Commit to increased gold sourcing from recycled and secondary sources.

Measure and establish benchmarks with a goal of continuous improvement.


Special Characteristics

Lean Operating

Costs

Supply Chain Efficiency

Competitive Pricing


Competitive Pricing

They are able to provide diamonds based on the customers preference

Different types are available on the basis of cut, clarity and colour

Hence the customer can choose what he/she can afford

Source: www.bluenile.com


Lean Operating CostsOnly 146 employees

• 133 full time +Contractors & temporary personnel

Operations via combination of proprietary and licensed technologies

Use of redundant internet carriers to minimise service interruptions

On-call team to respond to emergencies and technology issues


Supply Chain EfficiencyBypassed markups of traditional layers of diamond wholesalers and brokers

• More than ½ of total supply of high quality diamonds in US

Display of leading diamond and gem supplier’s product on web

Huge supplier network

Just In Time (JIT) inventory

Using suppliers as the 3rd party inventory holders


Educational Information & Certification


Marketing StrategyIncrease Blue

Nile brand recognition

Generate consumer

traffic

Acquire customers

Build loyal customer

base


Order Processing

Order placed

Supplier ships

diamond to Blue

Nile

Sent to assembl

y for setting

& sizing

Inspection

Shipment to customer• Usually

through FedEx


Growth Strategy•Price•Product mix•Customised•Non-customised

Expansion of product

line

•Based on consumer preference for jewellery•Extent of online purchasing•Competitive landscape

Geographical

Expansion


Supplementary Strategies30-day return policyFree shipping within USAppraisal stating the approximate retail

replacement value of the item


Environment ScanGrowth in US jewellery marketIncrease in number of online & offline

retailersBrick & mortar retailers started websites to

boost their salesMen Most likely customers of online

jewellery storesBlue Nile – “A guy’s best friend”


Criteria Bluenile.com

Diamonds.com

WhiteFlash.com

Ice.com

JamesAllen.com

Established

1999 2000 2001 1998

Range of Products

60,000 40,000 About 1000

300,000

55,000

Distinct feature

Competitive pricing

- Trade-up program

EMI option

s

Finest Collection

Information on

website

Yes Yes Yes (video tutorials)

No Yes (3D Viewing)

Competitors


What could be done…Improve the collection of jewels3-D view of diamondsMechanism to identify the ring sizeAuction sales


Thank You

blue nile online diamond retailer

Business

source gold

gold metals

increased gold sourcing

sourcing of gold products

business strategy14

marketing strategy14

growth strategy14

supply chain efficiency14