BlueNile.com Crushes Brick-and-Mortar Jewelers as More Consumers Head Online for Diamonds

Monday, August 5, 2013


We buy books online. Clothes, shoes, bags and even groceries. But when it comes to big-ticket items, like diamonds, most would cringe at the idea of spending that much cash in cyberspace.

There are so many reasons why you wouldn't purchase a diamond online. One of which is it can be lost or stolen en route to your doorstep. This will then lead to a strenuous dispute between you, the shipping company, the website and the bank or credit card company. Who needs that kind of hassle when you can simply cross the road to your nearest jeweler, purchase the bling you want and be done with it?

Unfortunately, that kind of out-dated thinking has no place in the year 2013, thanks to the efforts of one online diamond jewelry retailer: Blue Nile.

When Blue Nile co-founder Mark Vadon attends jewelry trade shows and conventions, no one wants to meet with him. His co-workers ask him to turn over his name-tag to avoid the nasty stares from diamond retailers and wholesalers.

And that's because what Blue Nile did to diamonds can be compared to what Amazon did to books: they changed an industry which was once thought to be immune to an online hostile takeover.

The website was launched during the dot-com boom of the late 1990's and a decade later became the second largest diamond ring retailer on the web (the first being Tiffany & Co.) In 2012, 4th quarter net sales reached $136 million, up 21% from the previous year. The consequence of their success led the industry to refer to Blue Nile as the "Evil Empire".

They made Internet history in 2007 when a customer bought a $1.7 Million, 10-carat stone with a diameter of a US penny. This proved that their brand is now associated with safety, trust and, best of all, luxury.

So, why are more and more consumers, predominantly males who are popping the question, heading to Blue Nile?

Five reasons:




  1. It's cheaper: According to Vadon, engagement rings on Blue Nile are 35% less than the traditional retailers. And that's due to low over-head costs associated with being completely online. Another way they keep costs low is that Vadon gets "his dealers to compete on orders as they come in on a web-based diamond exchange created by Blue Nile."
  2. It's Simple: The whole process of purchasing an item from their site takes a few minutes. It's deciding what to choose from the large array of products that takes time. If you aren't satisfied with their designs, you can build your own.
  3. No Annoying Sales People: Personally, I find salespeople in traditional shops to be intrusive and over-zealous. Sometimes, when customers say they are "just looking" they really mean it. Shopping online eliminates this nuisance so you can actually enjoy the experience. If you have questions and need a help, simply call their 24-hour hot line.
  4. Choices are Endless: The best part of shopping online is the large number of products you can find under one roof. And while it may be overwhelming to some, it's far easier than driving around town trying to look for a ring or necklace.
  5. There is a wealth of information: If you want to know anything about 4 C's of diamonds, this is the site you would visit. Not only do they sell jewelry, but they add value to their product by providing great information on how to choose, buy and maintain a diamond
I would definitely research this idea further when I am in the market for a diamond but I have two major reservations: 1- what will happen if the diamond is stolen or lost? and 2- How much does the same diamond cost in Dubai?

Once I find the answer to these two questions, I would definitely try them out.

Now, it's your turn: Would you purchase a diamond online if you knew it was cheaper? Have you ever done so? Share your experience with us in the comments section below.

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