E-Commerce. Archives
On-Line Sales Increasing.
Smith Barney predicts annual online sales growth of 15 to 20 percent for the next few years and 10 to 15 percent over the next 5 to 10 years.
Online Jewelry Sales Soar!
Just in From Rap.:
Online Jewelry sales were up a dramatic 113 percent to $1.9 billion, the largest increase of any retail category in the 2004 holiday selling season.
Online retailer amazon.com included jewelry and watches on its "best of 2004 list" - the top-selling, most positively reviewed, most wished for and the most favorite gifts as determined by its customers in 2004.
Why are online jewelry sales so strong? Experts say that the sharp rise in broadband usage is behind soaring jewelry sales. Broadband internet allows retailers to post "richer" diamond and jewelry pictures that really let you "see" what you are buying. The fact that many diamond wholesalers, vendors, and retailers, are now forced to showcase their diamonds and jewelry to internet savvy consumers with real data and information, has also helped boost consumer confidence in online jewelers.
Hispanic Jewelry Market Key Group For Retailers.
U.S. Hispanic consumers are willing to spend large amounts of money on jewelry, according to a recent online poll by the Jewelry Consumer Opinion Council (JCOC). That could mean big business for retailers, considering there are 39 million Hispanic consumers in the United States, a number that continues to grow.
The study finds that 75 percent of respondents already own fine jewelry, and more than half of them will spend more than $500 on fine jewelry purchases in the next few months.
Hispanic consumers represent the fastest growing group in the country, and their jewelry buying habits indicate that their love for fine jewelry will mean significant growth this year and in the future, according to the Jewelry Council.
The study finds that Hispanic consumers have a high interest in religious jewelry, but that they also desire diamonds and fashion jewelry.
Internet Shopping Exploding!
Internet shopping exploded dramatically this past holiday season (2004). VeriSign Inc., a prominent e-commerce network provider, announced that it processed transactions worth $12 billion between November 1 and December 31, 2004, up 88 percent from $6.4 billion during the same period in 2003. Transaction volume grew by 39 percent year-to-year.
Shop the Internet with Confidence.
In its fifth edition of the VeriSign Internet Security Intelligence Briefing (ISIB,) the company attributed the increase to broadband access, the availability of inexpensive goods on the internet, and an increase in trust with Internet security.
Online merchants also reported a drop in the number of transactions they categorized as too risky to complete, down to 6 percent from 7 percent in 2003. Although security continues to be a prime concern for both consumers and merchants, fraudulent transactions only accounted for 2 percent of all purchases.
Countries to watch out for were Romania, Vietnam, and the United States as the top source countries for total volume of e-commerce fraud during the 2004 holiday period while Belarus, Slovenia, and Vietnam were the top countries for internal percentage of fraudulent transactions.
This report by Verisign is confidence-building news for consumers who might still be hesitant in shopping on the Internet. Advanced encryption technology safeguards credit card information provided over the Net and individual companies membership in organizations such as Truste insures safeguarding and confidentiality of your personal information.
"Tsunami" In the Form Of Weak Dollar Hurting Jewelers.
Rapaport Trade Wire reports today that the rapidly sinking U.S. dollar is taking its toll on the jewelry industry. Profits are being squeezed for both jewelry retailers and suppliers and in some cases, merchants are reporting losses on business transactions denominated in U.S. dollars.
Several retailers like Kay and Zales are fighting back by cutting out wholesalers and buying directly from overseas jewelry and diamond producers, thus reducing the impact of the weak U.S. dollar.
This is causing great anger and ill will on the part of suppliers who now find themselves being squeezed out of the supply loop.
As jewelry costs rise, retailers have few choices. They can either raise retail prices or they can cut costs.
Most jewelers opt to cut costs before trying to raise prices. Internally, merchants have several methods of reducing costs including less store-level discounting, repositioning of the product line to higher-profit goods, cutting overhead expenses and having salaried personnel work longer hours.
Externally, jewelers can reduce their costs via direct sourcing with overseas manufacturers. This cuts out wholesalers and other middlemen who add costs.
Raising retail prices is extremely difficult in a highly competitive retail environment. During the all-important holiday selling season, many U.S. jewelers tried to raise the value of their average ticket — in other words, raise prices. However, this strategy proved to be unsuccessful; jewelry demand waned as consumers purchased less-expensive goods.
This problem is further exacerbated by the growing strength of the Internet, which serves to decrease in-store traffic and puts tremendous pressure on Brick & Mortar stores profit margins.
The bottom line is that jewelry wholesalers are being cut out of the pipeline at a rapid rate, and it is not inconceivable that in the very near future the jewelry industry will be dramatically transformed and resemble such industries as consumer electronics, Home centers, and Office supplies.
We are seeing before us the evolution and re-organization of the jewelry industry as Darwin's survival of the fittest takes hold. This "Scopes" trial won't play in Peoria but surely consumers will benefit by the resultant competitive and excellent pricing.
Internet Mother's Day Diamond Sales Rise 101%!
Internet e-commerce tracker, VeriSign Inc., says that Mother's Day online purchases rose 24 percent from 1 year ago to $4.4 billion. VeriSign measured sales from April 25, 2005, through May 8. Jewelry purchases increased 79 percent. Diamond purchases rose 101 percent and the average diamond purchase was $517.
"Mother's Day has arrived as one of our larger retail holidays. Where once this holiday would have been acknowledged with a phone call and a heartfelt card, we're increasingly seeing people using it as an opportunity to send expensive items, such as a necklace pendant," said Trevor Healy, vice president, Payment Services, VeriSign.
VeriSign alone accounts for 37 percent of e-commerce transactions across the North American continent and services 135,000 online retailers.
Brilliancescope by Gemex: Anatomy of Diamond Light Performance.
Many consumers are constantly asking us for advice on their prospective diamond purchases.They list their candidates and provide the diamond's numbers off the Lab reports and in some cases list additonal Cut information derived from either the Sarin (www.sarin.co) or Megascope (www.ogisystems.com) machine.
For round brilliant diamonds it is easier to advise against purchase
when the numbers clearly indicate an overly shallow or deep stone that will display poor to mediocre light performance.
The difficulty presents when consumers provide "numbers" that look very good and/or ideal. The term "ideal" for the purposes
of this article is used in the context of the Marcel Towlkowsky Ideal-Cut, the "numbers" calculated by Towlkowsky
in the late 1900's to result in a diamond that displays superior light performance.
The Brilliancescope, manufactured by Gemex Systems (www.gemex.com) is an imaging spectrophotometer that measures how well a diamond refracts and focuses light.
Past all of the numbers, a diamond's beauty is the result of how it returns light to your eye. When a diamond's facets have been cut to the correct size, angle, and aligned correctly, they act as mirrors, refracting light with great intensity and with an even distribution across the entire surface of the stone.
Different Diamond Cut Configurations
Brilliancescope Machine by Gemex Systems (Mequon, Wisconsin).
The Brilliancescope measures light performance in a controlled lighting environment consisting of six lighting angles.
The machine provides an objective method of evaluating the intensity, distribution, and interaction of light output by measuring
light that is returned through the crown.
The technology used in the BrillianceScope was originally developed
by UGTS and LambdaSpec Instruments.
UGTS was the tech development division and LambdaSpec
was the Marketing section that licensed the technology.
Randy Wagner, at the time at UGTS was one of the original developers of the technology and was awarded the patent in 1996-1997.
Kurt Schoeckert came on board in 1998, They formed Gemex, Inc.
and bought all of the technology rights from UGTS and LambdaSpec.
All optics used in the Brilliancescope are off the shelf parts or custom made by major optics companies such as Rodenstock and CRI.
Whether or not her diamond ring grabs your attention will be determined by the Cut quality of the stone; the better the Cut, the greater the light performance.
The diamond ring moves and tilts as she moves her hand. This tilting changes the entry angle of light through the diamond's facets.
The BrillianceScope standardizes these movements by precisely changing the angle of the light source to illuminate the diamond.
The Brilliancescope has six lighting angles to measure the stone;
five positions are reflected light and one position is diffused light which also displays the level of the diamond's Cut Symmetry and Contrast. If the diamond cutter has aligned all of the facets correctly, they will act as 'mirrors' refracting entering light back to your eye with great intensity and with an even distribution across the entire surface area of the stone.
Approximately 800,000 diamonds to date have been evaluated and registered into the Gemex database to determine the range of light performance.
These Evaluation Scales are linear graphs that show how a specific diamond performs in relation to the industry standards for reflection performance.
The Brilliancescope is user friendly and easy to operate. The Operator must calibrate the Brilliancescope at a minimum of once a week or it will automatically shut down and prevent a diamond from being run.
The Operator must insure that the diamond is clean. No smudges, oil, or lint anywhere on the diamond's surface. The glass plate must also be inspected and cleaned of lint and smudges.
Next the operator places the diamond table
down onto the glass plate and makes sure that it is centered in the Bullseye.
The cover is now closed and light analysis performed.
This is the output.
The Operator fills in the ID data of the diamond, then clicks on the LPA/WEB button which sends the output directly to Gemex for evaluation. After careful review by Gemex engineers, the Operator receives e-mail notification regarding the submitted scans.
Approved gifs can be immediately downloaded and provided to interested consumers.
Rejected scans come with an explanation and
a request to correct the problem and re-submission.
The Brilliancescope measures three components of light:
1.white light,
2.colored light,
3.scintillation.
White light is the evaluation of the diamond's overall area in
returning bright white light from the crown from each of 5 reflectance lighting angles.
Color light looks at each lighting angle and determines where bright color light is returning from the crown.
Scintillation refers to changing colors,the sparkle of light rays coming from the stone when it moves and/or the light source changes.
Arrows below point to "freckles" and "rice krispies" which are on the diamond's periphery and indicate scintillation.
Operator clicks on the LPA button that sends the data to Gemex for inspection and review.
How is the output evaluated.
At Gemex Headquarters in Mequon, WI., GemEx engineers review these submitted scans for accuracy.
Each scan is screened for over 20 possible human errors and technical issues such as proper and timely machine calibration, clean diamond,
clean glass plate, and proper centering of the diamond, to assure that the scan is accurate. If human error or technical problems are found
the scan is rejected and the Operator immediately notified of the problem, asked to correct it, and then to re-scan the diamond.
If the scan is approved on the first go around, it is sent to a second check station and again reviewed for the same 20 + check list.
If it passes that final check, the report is printed and mailed to the Operator/customer. If there is no hard copy Light Performance™ Report,
you cannot be assured that the scan was put through these very important checks by Gemex, and therefore you
cannot assume that the results are accurate or repeatable. This is the reason that only GemEx can issue Light Performance Reports
and does not allow BrillianceScope users to unilaterally
provide scan results or print their own reports.
This rigorous screening system by Gemex assures that Brilliancescope results for all Operators are accurate, valid, and repeatable.
RESULTS:
Light Performance results are depicted in two ways: 1. Bar graphs, and 2. Five light views and one view in diffused light showing symmetry and Contrast.
One criticism leveled against the BrillianceScope is that it does not provide easy to understand number results. This is not true.
The first prototype of the BrillianceScope did indeed use a number scale of 1 to 10. Consumers responded by asking for scores that were
visually indistinguishable from each other such as a 9 versus an 8.5
(Both are in the Very High cataegory).
Gemex therefore decided to abandon the number scale
and instead use bars because
light performance is a continuum not a stepped sequence.
A 9.3 is not visually discernable or necessarily superior to that of a 8.8.
Number results are provided by the Brilliancescope and can only be seen by the Operator via a special click-through.
Both White light and Color light data are calculated in terms of percentages.
A percentage of area returning
white light is calculated and used to determine
where on the scale this diamond scores compared
to other diamonds of the same shape.
Results from the Brilliancescope are repeatable within a very useful range which is the width of the bars on the scales.
The analogy is to two race cars; one traveling at 100 MPH, the second at 105 MPH. Your eye cannot discern +/- 5 MPH.
On the other hand, slight changes in the numbers make it appear as if
the score is not repeatable. For example, a score of 8.8 versus 9.3 would be seen by a consumer as being qualitatively
different with an attached value of "good" versus "better".
Your eye can not pick up these tiny percentages of variation.
Comparative measurement avoids this problem.
The 5 light views show you the intensity, distribution, and interaction of the measured light components. Light view 6 shows Symmetry and Contrast under diffuse light conditions.
Contrast (Black Areas) under Diffuse Light as well as Symmetry are shown in Light View 6. Note the excellent contrast in the 60-60 diamond which has a facet alignment significantly different from that of an Ideal Cut round diamond.
Here are the informative Brilliancescope results and Cut data for this 60-60 diamond.
One of the criticisms leveled against the Brilliancescope by certain Ideal Cut companies is that their diamonds do not perform well
because the machine tends to favor certain "brands" over others. This is not true.
The Brilliancescope is an equal opportunity evaluator and evaluates light performance based on proper facet alignment, facet size, and
facet angle. The results from this 60-60 diamond clearly illustrates this fact.
Why Light Performance and Not "Numbers" Are Key.
In a previous article posted to www.diamondtalk.com we have stressed the importance of light performance over the "numbers"
in determining a consumer's diamond purchasing decision.
The article is here:
Diamonds and Gemex
We agree with our colleagues that "seeing is believing" and
we always advise consumers to make every effort to physically "see" and compare as many diamonds as possible in order
to make an informed buying decision.
It is our opinion based on working intensively with Gemex and the Brilliancescope over the past four years, that this
technology is currently the very best available to give consumers accurate information on a diamond's light performance.
eBay Sets Revenue Records!
During its second quarter of fiscal year 2005, Internet auction powerhouse eBay Inc., logged $1.5 billion worth of jewelry and watch transactions. According to eBay's quarterly statement, the website has 157 million registered users.
The company itself recorded a 40 percent increase in corporate revenues from 2004 to close second quarter at $1 billion on June 30, 2005. Operating income rose 49 percent to $379 million, and eBay earned $292 million, or 21 cents per share.
On-line Shopping & Sales Increasing!
An increase in the number of female shoppers will contribute to 14 percent of jewelry sales moving online by 2010, according to a new forecast from Forrester Research released Monday.
Last year, it was estimated that 5 percent of jewelry sales were occurring online.
But jewelry is just part of a retail online picture which is growing even faster across the board, according to Forrester. Thanks to innovations that will make online shopping simpler and more engaging, online retail sales will nearly double within five years—from $172 billion in 2005 to $329 billion in 2010, according to the report. That increase includes a 14 percent compound annual growth rate over the next five years.
"Businesses are debating their online strategy. Many believe they became too focused on sales. Now they're looking at their Web sites as a way to drive in-store traffic and increase their engagement with customers," said Forrester Research Vice President Carrie Johnson in a release. "This is a huge shift in philosophy, as e-commerce enters a more sophisticated phase. But it's also creating tension, as CEOs demand ROI for expensive Web sites with hard-to-define metrics, such as loyalty and brand."
Since more and more mainstream consumers are already shopping online, retailers are investing in improved online shopping experiences by using state-of-the-art technologies, such as sophisticated analytics and personalization tools.
Other highlights from the Forrester report:
-E-commerce will represent 13 percent of total U.S. retail sales in 2010.
-Travel remains the largest online retail category, growing from $63 billion in 2005 to $119 billion in 2010.
-General merchandise (all retail categories, excluding food and beverage, auto and travel) will top $100 billion for the first time in 2005.
-Online sales of health and beauty products will grow at an annual rate of 22 percent.
-Twenty-nine percent of small appliance sales will migrate to the Web by the end of the decade, as a generation that grew up with the Internet marries and attends weddings.
-Categories showing significant growth (i.e., growth outpacing the overall 14 percent compound annual rate) include: apparel, consumer electronics, health and beauty, food and beverage, home products and sporting goods.
The $329 billion Forrester projects for online retail sales for 2010 represents a minor downward adjustment from its 2004 forecast.
Ernst & Young Predicts Challenging Season for Retailers.
Rising distribution costs that resulted from Hurricane Katrina will deliver a hit to retail spending this holiday, but consumers will still pursue luxury products, the Ernst & Young Consumer Trends Center said in a preliminary report released today.
The firm expects holiday sales increases for November and December to be 6 and 7 percent this year, compared to an 8.3 percent increase for the same period last year.
"It will be a challenging holiday season for most retailers, but many have back-up distribution plans and inventories that will help them cope with the effects of Hurricane Katrina," said Jay McIntosh, Americas Director of Retail and Consumer Products for Ernst & Young LLP. "To bolster traffic and sales, retailers will begin promoting earlier in the season and promote more frequently and aggressively than originally planned." Luxury items such as diamonds and jewelry, due to the growing luxury trend will continue to appeal to shoppers, and higher gas prices likely will boost Internet sales.
Ernst & Young issues a final holiday forecast in early November.
Ebay Jewelry Sales Surging!
Third-quarter sales of jewelry through online auction house eBay totaled $1.6 billion for the third-quarter ended Sept. 30, the company announced Wednesday.
Gross sales across all trading platforms for the third quarter ended Sept. 30 totaled $10.8 billion, a 30 percent increase from the $8.3 billion reported in the third quarter last year. Other categories to break the $1 billion sales mark for this third-quarter were: eBay motors at $14.1 billion; clothing and accessories at $3.1 billion; consumer electronics at $3 billion; computers at $3 billion; books, movies and music at $2.5 billion; home and garden at $2.4 billion; sports at $2.1 billion, collectibles at $2.1 billion, business and industrial at $1.5 billion; toys at $1.5 billion and cameras and photo at $1.3 billion.
The number of registered eBay users increased 35 percent for the quarter, reaching a total of 168.1 million people. The company reported 458.6 million new listings for the third quarter, marking a 32 percent hike over the same period last year.
PayPal, the online payment company owned by eBay, reported a total of 86.6 million accounts for the third quarter, increasing 53 percent over the same period in 2004. PayPal handled $6.7 billion in payments for the period, a 44 percent increase over last year.
Our advice: If you're buying diamonds on Ebay, make sure that they have either a GIA (Gemological Institute of America) or AGS (American Gemological Society) grading report. These are the two best diamond grading laboratories in the business. Their accuracy, stringency, and consistency is unequalled. Stay away from other grading "labs".
Check out the stores examination/review periods and Return/Refund Policies to make sure you have enough time to get the merchandise independently appraised and returned/refunded if you so desire.
What information is the Vendor providing? Lab Reports, Photo's, Cut Grade Analyses, Light Performance results are all the types of reports you should be looking for. Treat this purchase with the same care and consideration you do for a house and car. Get as much information as possible.
Check the vendor's feedback carefully and compare to the merchandise that was purchased. What does the feedback say?
Same goes for rings and settings. Get it appraised to corroborate that it is as described.
There are very reputable diamond vendors on Ebay selling quality merchandise but you need to do your homework to find them and make sure you do not get taken advantage of.
Consumers Fear ID Theft for Online Shopping.
According to a report issued by Consumer Reports WebWatch, a
quarter of Internet users have stopped making online purchases for fear of identity theft.
The report, issued last week, finds that 80 percent of Internet users are at least somewhat concerned that someone might steal their identity from the personal information available on the Web. Most Internet users, 86 percent, have made at least one change in their behavior because of fears of identity theft.
Of those who shop online, 29 percent say they have cut back on how often they buy products on the Internet. Thirty percent of users reveal that they have reduced their overall use of the Internet due to these fears, and 53 percent say they have stopped giving out personal information online, according to the report. More than half (54 percent) of those who shop online say they have become more likely to read a site's privacy policy or user agreement before making a purchase.
We advise consumers to check the Affiliations of the e-commerce site for their Privacy Guarantees. A license and seal of approval by an organization such as Trust-e is a postive indication that the website is protecting the privacy and confidentiality of your submitted information.
Same goes for the website's shopping cart: Make sure that it is SSL encrypted and that it has a Seal of Approval from a known and reliable
Credit Card processing Company such as Verisign.
Diamond Online Holiday Sales: It's Crystal Ball Time.
Doug Schwegman, Market Research Director for Cybersource, a leading Credit Card Processor for Online Merchants is the first e-commerce analyst to open his crystal ball and prognosticate on whither Holiday on-line sales are going.
Last year the U.S. Dept. of Commerce reported that online sales by U.S. retailers grew 23.9% in the fourth quarter. So what is the growth outlook for 2005 holiday sales? As of mid October, only a few forecasts of online retail sales for the upcoming holiday season have been published (see table below). Those estimates range from 22% to 26%.
So far in 2005, online retail sales have turned in a solid performance according to U.S. Dept. of Commerce data. Year-over-year Q1 growth was 23.3% and that accelerated to 26% in Q2. Third quarter data will not be available until November 22nd but merchant performance indicates that third quarter growth will be similar to that of the second quarter. In Q3 merchants processing over one year achieved a 42% year-on-year growth in credit card transactions, exceeding the 38% growth they reported the quarter before. So it appears, according to Schwegman that we are entering the holiday selling period with good online sales momentum. Further, higher gasoline prices may actually provide additonal incentive for shoppers to use online vs. in-store channels.
Coming down the homestretch in these last two months of the year, trying to estimate the peak shopping day is harder this year than in past years. This is because the biggest shopping day has historically been the Monday that falls at least seven days prior to Dec. 25th. By that formula, in 2005, the peak shopping day will be Dec. 12th. But there's a complication this year. Monday the 19th is almost seven days prior to Christmas day, so it may be possible that the 19th will be the peak day if enough online merchants and shipping providers decide to guarantee December 24th delivery for orders placed on the 19th. In any event, it seems reasonable to expect that the peak online selling period this year will be Dec. 12th - 19th.
Over the past two years the average on-line merchant has seen order levels about 40% higher in the peak selling period compared to the first week of October. Diamond and jewelry merchants see much higher seasonality. The upsurge in orders typically starts the week following Thanksgiving, but 2004 saw an earlier uptick starting in mid-October as some merchants started holiday promotions earlier than normal.
Stay tuned.
Diamond E-tailer BlueNile on Pace for Record Sales.
Internet diamond retailer Blue Nile Inc.'s third quarter of fiscal 2005 results were reported after the markets closed on November 8. Net sales were $42 million, a drop of $2 million from its second quarter, but 24 percent higher than one year earlier. Its third quarter net sales were also lower than its first quarter sales of $44 million.
Net income for the third quarter rose 49 percent to $2.5 million. Net cash provided by operating activities for the quarter ending October 2, 2005, stood at $6.6 million, compared with $3.3 million in the third quarter of 2004.
Gross profits were $9.2 million or 22 percent of net sales, both figures were less than Blue Nile reported during its second quarter of 2005.
Blue Nile excercised a share buy-back of 199,975 shares for about $6.5 million.
"Our third quarter financial performance reflects the strength of the Blue Nile consumer proposition," said Mark Vadon, CEO. "Our results demonstrate the appeal of the Blue Nile brand, the strength and potential of our business model, and our ability to execute with excellence for our customers."
Vadon said he was looking forward to "the upcoming holiday season in which we expect to achieve record sales levels, while continuing to provide our customers with an exceptional experience."
Blue Nile predicts full year sales, ending January 1, 2006, to hit between $205-$212 million, which would require fourth quarter sales of more than $75 million.
Update on E-Commerce Holiday Shopping.
E-commerce will represent the fastest-growing retail sector this holiday season, according to a new Retail Forward study.
The global management consulting and market research firm projects e-commerce sales will grow 27 percent in the fourth quarter, with holiday sales totaling $27.3 billion, according to Retail Forward's monthly ShopperScape consumer survey. Factors driving the sales growth include a robust job market, income gains and lower prices in key online categories like electronics and apparel.
But despite improvements in the online shopping experience in recent years, Retail Forward reports that two-thirds of online shoppers say they've had frustrating online shopping experiences in the past six months. According to Retail Forward's recent E-Retailing Shopper Update, the most frustrating online shopping experiences involve pop-up ads or forms, slow-loading pages and being forced to register in order to make a purchase.
The survey finds that only 11 percent of shoppers complain to the company when frustrated with a site, although they will complain to friends, family members or co-workers.
Diamond.com Reports 46% Loss for 3Q.
Online retailer Odimo Incorporated reported a decline in net sales for the three month period ending September 30, 2005, to $9.1 million compared with $10 million in 2004. Odimo’s net loss for the period increased to $3.5 million compared to $2.4 million in the third quarter of 2004. Headquartered in Florida, Odimo operates three websites -- diamond.com, asford.com and worldofwatches.com.
Odimo’s diamond sales for the third quarter decreased marginally to 33.7 percent of gross sales, as compared with 34.2 percent of gross sales in the previous corresponding quarter. Jewelry sales in the three month period increased to 15.9 percent of gross sales, compared with 12.9 percent of gross sales in 2004. Luxury goods sales decreased to 11.6 percent of gross sales, compared with 14.4 percent of gross sales, watch sales marginally increased to 38.8 percent of gross sales.
For the nine month period ending on September 30, net sales increased 8.5 percent to $33.4 million. Net loss in the nine month period decreased to $9.5 million, compared with 10.6 million in the first nine months of 2004.
Gross profit for the third quarter of fiscal 2005 was down to $2 million, (22.3 percent of net sales) compared with $2.8 million, (28.0 percent of net sales) in the previous corresponding quarter.
Odimo attributed the decline in gross profit margin to an increase in promotional activity aimed at increasing luxury good purchases.
Abazias.com Reports 3Q Loss of -15%.
Florida-based website Abazias.com reported a decrease of 15 percent in third quarter sales to $520,000, compared with the previous corresponding period, according to a company statement.
For the nine month period ending September 30, 2005, sales increased 8.5 percent to $133,000 with a gross profit of 172 percent over the corresponding period in 2004. Net loss for the nine month period reached $0.39 million compared to a net loss of $1.02 million in the corresponding period in 2004.
Zales Jewelers Reports 1Q06 Loss Of 24M.
Investment firm Goldman Sachs called Zale's "turnaround expectations for this holiday shopping season as overly ambitious," on November 9. The investors report was followed by a 2 percent decline in Zale share price that day on the New York Stock Exchange to near its 52-week low of $25.50. Shares closed 0.2 percent lower at $27.11 on the eve (November 15) of its announced first quarter of fiscal 2006 earnings.
Before the markets opened on November 16, Zale reported a net loss of $23.7 million for its first quarter of fiscal 2006. The loss includes a $5.3 million after-tax impairment charge related to its planned closing of 30 Bailey Banks & Biddle locations. Zale president and CEO, Mary Forte, said the company had "made a number of significant changes at the Zales brand in a fairly condensed period, but we believe these changes are essential to successfully reposition Zales for long-term market share growth."
Additionally, Zale repurchased $45 million in stock, which "signifies the confidence we have in our business," Forte said.
Forte said customer response to new merchandising assortments would drive market share during the Christmas holiday shopping season. During a conference call, Forte said they were upgrading some 600 best selling items and identifying some 1,200 new items and new collections "to reinforce Zale as a leader in style," Forte said.
Zale is targeting direct mail and television advertising campaigns as the primary vehicle to drive brand recognition for the holiday season.
In preparation for the second quarter, Forte said that Zale has "graduated 1,000 employees in diamond certification training" from the Diamond Council of America. "We are confident in our preparations and will take our fair share of the market this holiday," Forte said.
Zale operates 2,373 specialty jewelry retail stores in the United States, and has seen its share price fall about 10 percent in 2005. Goldman Sachs contends "in our view" that Zale took on too many changes at once and downgraded Zale stock to "under perform" from "in-line" with estimates. Zale changed merchandising about one-third of its product set, shifted product sourcing outside of the United States, and narrowed some of its stores down into special demographic fits.
In response to Goldman Sachs' questions on future brand promotion strategy, Forte said, "We did homework on this, [we] changed our ad agency and proceeded to take [lessons learned], and get more research on our own, and did more research with Diamond Council of America when we came up with our game plan for the message we will send to our consumer."
For its first quarter of fiscal 2006, Zale same-store sales slipped 1.2 percent, and Forte said, "We are disappointed with these sales results." Overall revenues for the quarter rose almost 1 percent to $432 million.
"Delay in receipts of new merchandise related to the Zales repositioning resulted in lower than planned in-stock positions during the quarter," Forte said.
Product offering changes and new vendor relationships "has temporarily extended the lead time of supplying merchandise to our stores," she said.
In October, Zale and The Knot Inc., agreed to promote Zale's brands on the wedding planner website (The Knot) as part of a full-service bride and groom service. Eventually the agreement is set to promote Zale brands with banner ads, product placement, and a ring search tool. Zale will feature The Knot's editorial features relevant to engagement ring and wedding jewelry.
For fiscal year 2005, Zale reported a 3.4 percent increase in revenue to $2.4 billion and same-store sales up 0.3 percent. Profits for the year were flat compared with a profit of $106.8 million in fiscal year 2004.
The company expects to close some 30 Bailey Banks & Biddle stores after the 2005 Christmas shopping season.
December Key Month for E-Tailers.
Luxury retail and the Internet are the hot places to shop for the upcoming Christmas holiday season, according to Tracy Mullin, CEO of the National Retail Federation.
Mullin told the USA Today newspaper that she expects an overall 5 percent growth in retail sales compared with 2004. She gave the biggest draw to luxury retail stores, online shopping, and gift certificates.
In the United States, the December gift-giving season is the most important retail season, and already diamond-related retailers and are counting on strong gains to boost their bottom line.
Mullin said jewelry stores could find December sales accounting for as much as 40 percent of annual sales.
Mullin also told the newspaper that shoppers are growing retail savvy and using catalogs, the Internet, and in-store browsing to compare prices and product quality.
According to a new survey by Yahoo! small business research, 83 percent of holiday shoppers said they would be browsing the Internet for gifts in 2005. Eighty-percent of shoppers said the high price of gasoline was causing them to drive their mouse online rather than an automobile for the shopping experience.
Sixty-percent told Yahoo! that it was important to their needs that retailers have an online presence. Shopping on the Internet also affords flexibility to the consumer to "buy anytime," avoid lines and traffic, and to find specialty items often not carried in traditional stores.
Mullin estimated only four in 10 shoppers would make purchases online.
Are You Ready For Cyber-Monday?!
Cyber Monday, which would be November 28, 2005, the Monday after Thanksgiving, is quickly becoming one of the biggest online shopping days of the year, according to a report released by Shop.org/BizRate Research 2005 eHoliday Mood Study.
In 2004, 77 percent of online retailers said that their sales increased substantially on the Monday following Thanksgiving. This trend is driving serious online discounts and promotions on Cyber Monday for 2005.
According to the survey, the largest increase in Cyber Monday sales in 2004 went to the jewelry and luxury retailers, with 89 percent of websites seeing substantial increases in sales, and consumer electronics retailers at 86 percent.
“On Cyber Monday, consumers set their sights on surfing for holiday gifts and shopping online,” said Scott Silverman, executive director of Shop.org. “This year, online retailers will be capitalizing on the increased traffic by offering special promotions and discounts,” he said.
Researchers specializing in online sales, attribute the increase in web traffic to the faster and more secure Internet connections at work. Consumers, who were unable to complete their shopping over the Thanksgiving weekend, also are driving internet sales on Cyber Monday. Internet sales analysts also expect many consumers to shop on Cyber Monday from home after work or when their children are sleeping.
According to a recent Shop.org survey, conducted by BIGresearch, more than one third of consumers (37 percent,) or 51.7 million people, said they will use Internet access at work to browse or buy gifts online this holiday season. The survey found that more than half of young adults 18-24 years (51 percent) and nearly half of those 25-34 years (49 percent) will be shopping online during work hours. The survey also found that men (42 percent) are more likely than women (32 percent) to shop at the office.
Many online retailers are offering extra incentives to encourage people to shop online. According to the eHoliday Mood Study, 43 percent of online retailers plan to offer special promotions and discounts on Cyber Monday. Deals will range from free shipping, to gifts with purchase, to percentages-off.
Online retailers are also planning for large-scale promotions on Thanksgiving Day, when most retail stores will be closed. A Shopzilla survey found that 36 percent of online retailers will be offering special promotions and sales on Thanksgiving Day. Some will even be offering their Black Friday discounts one day early on their websites.
The consumer poll has a margin of error of plus or minus 1.0 percent. Shop.org is an association for retailers online. Founded in 1996, Shop.org became a division of the National Retail Federation in January 2001. The association’s membership includes interactive executives from store-based retailers, catalog-based retailers, Web-based retailers, and retail solution providers
Internet Comes Of Age For Luxury Shoppers.
A Report today by Luxury retail analyst Unity Marketing says that luxury consumers prefer the Internet for shopping, because it is easy and convenient.
Out of 15 luxury product categories Unity listed, consumers chose 11 categories they favor for shopping online.
In the wider scheme of retail shopping however, the Internet only accounts for a fraction of the total. The figure has been growing each year since 1997, and accounted for $230 billion in 2004.
"For most retailers the luxury consumer segment represents their marketing ‘sweet spot,’" said Pam Danziger, president of Unity. "They shop more frequently and spend more money when they shop."
Danziger said that --at the very least-- half of luxury consumers planned to buy gifts online in 2005.
Fully 82 percent of luxury consumers agree with this statement: Internet shopping has made shopping easier for me. Some 78 percent agree that the Internet: Lets me find exactly what I want at the right price without a lot of hassles.
The ability to compare prices was the No.1 point valued by luxury consumers, and is also one of the most important elements across all consumer segments as well from independent studies by AOL, comScore, and Forrester Research.
Unity queried some 1,200 consumers with an average income of $142,000 and an average age of 43 years. Of the group surveyed, Unity said 94 percent used the Internet to buy products during the third quarter of 2005.
Other findings report:
* 43 percent researched a product and made the purchase in-store.
* 35 percent browsed the product in-store and bought online at a later date.
* 20 percent researched the product online and ordered it by calling the store.
* 67 percent use the Internet to compare prices.
Why Do I See the Same Diamond Listed by Many Internet Diamond Sites?
Drop ship diamonds are an unfortunate internet practice where many internet "jewelers" and diamond vendors will attach a virtual database of wholesale diamonds from various diamond wholesalers and manufacturers.
These internet diamond stores have no experience with diamonds and jewelry and in most cases have no idea about the quality of the diamonds they are selling. They literally built a website and decided to sell diamonds! They will brag about how they have a database of a gazillion diamonds to sell. The only problem is that they never actually see these diamonds, much less know anything about the crucial nuances of any given stone.
What they are doing is simply attaching a database of stones to their website with a built in markup. In most cases you will see the same diamond on many different websites, since none of these guys actually own the stone. Then an unsuspecting customer comes along and makes a purchase for a diamond which the vendor has never seen or touched, and the stone gets "drop shipped" directly from the manufacturer to the end consumer, never once passing through the hands of the diamond seller.
Buy I-Pod, Get A Diamond, Too.
Kyocera Corporation of Japan, which is largely a communications and digital imaging company, plans to add diamond jewelry to its product set by early January 2006.
The company also sells fine china. According to press reports, the marketing staff requested adding diamonds to the jewelry offerings in order to boost luxury sales.
"Growth is our mission, and creativity is our greatest asset," the company writes as its mission statement. "Create. Change. Grow. Think creatively; execute logically," which was the line of thinking used to add diamonds to the line-up of man-made opal and synthetic gemstone jewelry.
Kyocera will procure diamonds for its Diplea-brand diamond jewelry, according to the company.
Kyocera engages in the development, production, and distribution of telecommunications equipment, electronic components, solar energy systems, and industrial ceramics. Micro-gemstones and fine ceramics parts are used in many microprocessing products the company produces and sells.
Just another company looking to make a quick buck, in our opinion. See our recent entry on this topic: Virtual Diamond Databases
On-Line Sales Surge This Holiday Season.
National Jeweler reports that Online sales for the 2005 holiday season surged 25 percent, reaching $18.11 billion, according to new data from comScore Networks.
This year's holiday sales spike for online, non-travel spending from Nov. 1 through Dec. 25 eclipsed the $14.5 billion seen in holiday sales during the same period of 2004, according to comScore, which tracks online consumer behavior.
"We're seeing another terrific holiday season for online spending," comScore Chairman Gian Fulgoni said in a release issued Thursday. "The growth of 25 percent we're now seeing, versus a year ago, is slightly ahead of our initial forecast of 24 percent growth, reflecting the aggressive price discounting offered by online merchants late in the season and cnsumers' increased confidence in expedited shipping."
Apparel and accessories was the second most-popular product category by dollar sales for online holiday sales this year, as well as being the second-fastest growing product category. According to comScore's report, the apparel and accessories category saw $3 billion in online sales this year, marking a 37 percent increase over last year.
The other two most popular product categories for online holiday sales were computer hardware and consumer electronics. The sports and fitness category saw the greatest sales growth this season over last year, according to comScore, rising 49 percent over 2004.
According to comScore, the five retail Web sites which saw the greatest number of total visits during the holiday season (Nov. 1-Dec. 25) were, in descending order: eBay, Amazon, Wal-Mart, Apple Computer, Inc. and Target. As with last year, the weeks of Dec. 11 and Dec. 18 saw the greatest dollar amount of holiday online retail sales, with more than $3 million spent during each of those weeks.
Walmart Has Shaky Holiday Season
The Associated Press reports this morning that Wal-Mart Stores Inc., which made a big push this holiday season to woo customers with aggressive discounts and marketing, estimated that its December sales will meet only the low end of its forecast.
The world's largest retailer said Saturday that sales at stores open for at least a year, known as same-store sales, are expected to be up 2.2 percent in December. The forecast was for a 2 percent to 4 percent gain. Same-store sales are considered the best indicator of a retailers' health.
The company said that general merchandise sales outpaced demand for food.
Wal-Mart, which stumbled during the holiday 2004 shopping season, came out with a holiday campaign two weeks earlier than last year. The retailer had a solid start to the season, but like many merchants, struggled with shoppers delaying their purchases longer than last year.
Wal-Mart, whose gift card sales beat expectations this season, is counting on a big sales boost in January from gift card redemptions. Gift card sales are recorded only when customers redeem them.
To entice customers with the newfound money to splurge on regular-priced goods, Wal-Mart rushed in new spring assortments and new outerwear for the day after Christmas. Meanwhile, it pushed discounted holiday goods to the back corner.
Wal-Mart and many other major retailers are expected to announce their final December results this Thursday.
BlueNile Execs Selling Their Stock.
Bluenile insiders have been selling their shares all the while promoting their company. The selling pattern has been constant and consistent, with Mark Vadon, BlueNile's CEO leading the way.
This selling activity is in stark contrast to a recent interview given by Vadon:
What do Bluenile insiders know that their general stockholders don't know?
Romance is Thriving this Valentine's Day!
Harris Interactive has released a study which shows that romance is alive and thriving but is taking on different forms.
Traditions such as proposing on bended knee and the man choosing the engagement ring alone are much less popular than anticipated. However, the study also showed that traditional proposal customs were much more important to younger adults, suggesting we're entering a new era of romance.
Key findings include:
-- To knee or not to knee? Only 36 percent of adults believe it is
important that a man get down on one knee when he proposes.
Surprisingly, more men than women believe this is an important
tradition (40 percent men vs. 32 percent women). Out West it's even
less important, as 71 percent plan to keep both feet firmly on the
ground. However, young adults, aged 18-34, are much more inclined to
feel it's important to propose on bended knee, 59 percent, compared to
an average of 25 percent for older age groups.
-- Let's get personal ... Americans would choose to propose at a spot that
has personal significance to the couple (83 percent), over a nice
restaurant (12 percent), a public sporting event (1 percent), or even a
romantic destination, such as the Eiffel Tower (4 percent). Even more
important? -- Leave family and friends at home, say 91 percent of
respondents.
-- Size matters -- Especially if you live in the Northeast. While only 41
percent of adults admit that the size of the diamond is important, it's
a bigger deal in the Northeast, where 49 percent indicate size matters,
compared to 39 percent of those living in other regions of the country.
It also matters more to men (44 percent men vs. 39 percent women),
suggesting just how much they fret over the proposal and the engagement
ring purchase.
-- Two's company ... Sixty percent of adults believe both members of the
couple should be involved in choosing an engagement ring. Perhaps men
want women involved in the process out of fear of choosing the wrong
ring (62 percent men vs. 58 percent women).
-- Should I ask for their blessing? The majority, 53 percent, say it's
important to ask your future in-laws for their blessing. It's
especially true in the South, where 58 percent say it's important,
compared to 50 percent of those living in other regions. Again, young
adults (61 percent), and especially young men (68 percent), were most
likely to adhere to this tradition, compared to 49 percent of those in
other age groups.
-- Be honest, is it cheesy? No, a Valentine's Day proposal is romantic,
according to 63 percent of adults. Unlike other traditions where
younger adults were more likely to adhere to romantic traditions,
respondents find a Valentine's Day proposal more and more romantic as
they age.
-- Jolie or Aniston? We'll take Jolie. Adults choose Angelina Jolie
(chosen by 19 percent of men) and George Clooney (chosen by 27 percent
of women) as the celebrities they would most want to receive
Valentine's Day proposals from this February. At the bottom of the
list, Tanya Harding and Axl Rose each received one vote. A surprising
number of adults are not enamored of the rich and famous, with 32
percent saying they wouldn't want a proposal from any celebrity.
Bluenile Stock Price Sinks on Disappointing Results.
Shares of Blue Nile (NILE:Nasdaq )dropped sharply in late trading Tuesday after the online jewelry retailer posted weaker-than-expected results for the holiday quarter and issued a 2006 forecast below Wall Street's projection.
The company reported a fourth-quarter profit of $5.3 million, or 29 cents a share, up from $4.6 million, or 24 cents a share, a year earlier. Analysts polled by Thomson First Call expected earnings of 33 cents a share.
Blue Nile's sales rose to $73.2 million from $64.5 million, but were well below Wall Street's target of $80.3 million.
The company's outlook also disappointed Wall Street. For the quarter ending April 2, Blue Nile forecast earnings of 11 cents to 12 cents a share, with sales of $47 million to $49 million. The forecast include stock-option expenses of 3 cents to 4 cents a share. Analysts, meanwhile, had been expecting first-quarter earnings of 19 cents a share and sales of $54.1 million.
For all of 2006, Blue Nile sees earnings of 62 cents to 72 cents a share, including 14 cents to 16 cents in options costs. Analysts predict earnings of 99 cents a share, before options. The company forecast sales of $220 million to $245 million, below Wall Street's target of $258 million.
Blue Nile shares were down $6.91, or 19%, to $30.38 in after-hours trading.
Two weeks ago we pointed out that Bluenile Insiders have been constantly and consistently selling their stock.
So much for competing with Tiffany.
Valentine's Day Sales Rise Dramatically.
Valentine's Day gift-givers have spent an average of $105 on gifts to date, 40 percent more than they spent by this time last year, finds a new survey.
Unity Marketing's latest Gift Tracker study finds 15 percent of shoppers have already made their Valentine's Day purchases, and about 54 percent of shoppers still plan to make a Valentine's Day purchase.
Last year, about 60 percent of consumers bought Valentine's Day gifts, making it the third most-popular gifting holiday after Christmas and Mother's Day. About 30 percent of shoppers will purchase Valentine's Day decorations this year, according to the Gift Tracker study.
The study finds that consumers spent an average of $1,935 on gifts in 2005, with 61 percent going to holiday gifts and 39 percent going toward occasion gifts (birthdays, graduation, etc.) However, they spent about 6 percent less in 2005 on gifts than in 2004.
Zales Is In Trouble.
Zale Corporation reported earnings shy of $88 million for its second quarter of fiscal 2006. Profits for the quarter were down 12 percent.
Interim company CEO Betsy Burton said, "There had been a number of quarterly earnings misses, a number of internal financial targets missed, and our largest brand, Zales, saw its market share continue to erode."
Burton also announced that the board asked Paul Leonard, 51, to leave his post as president of Zales Jewelers, the company's largest division. John Zimmerman was appointed president of a newly-created North American division for Zale.
Zale wrote-off inventory for the quarter ending January 31, 2006, and lease settlement costs related to closing 29 Bailey Banks & Biddle locations.
Revenue for the quarter stood at $994 million, up 2.3 percent with same-store sales up 1.4 percent. Year-to-date revenue is up 1.9 percent to $1.4 billion; and same-store sales are up 0.6 percent, but the company excluded the stores it closed.
"Upon review of Zales' business, we concluded that the new strategy negatively impacted our brand positioning because it de-emphasized the value component and key diamond categories of the brand's assortment," Burton said.
Same-store sales for the third quarter are expected to remain flat the company reports.
The E-commerce landscape is rapidly changing.
How Search Engines Find Your Site
I just found a really awesome article by Lara Ewen on how search engines crawl cyberspace looking for websites.
This is a must read for anyone that wants a good basic idea of the dynamics of Search Engine Marketing and Search Engine Optimization.
If you own or operate a diamond or jewelry website, read the rest of this article!
Continue reading "How Search Engines Find Your Site" »
Perfect Diamond Gift for Her: Listen Up Guys!
Are you still contemplating what to buy her, insisting on that one perfect gift? Engagement ring? If so, you might want to head over to eBay, which is offering some exceptional items, including a $10.95 million 81.98 carat D / IF emerald cut loose diamond.
Maybe not for everybody's pocket, but if you are looking for a truly exceptional item, and have the financial ability, some of the following stones offered on eBay will leave the recipients speechless.
If you are looking for something slightly more modest, how about a 50.98 carat, I / VS1, IGI certified, pear shaped loose diamond, offered for $3.32 million?
Three other seven-digit diamond offers include a parcel of 22 GIA certified flawless diamonds with a total carat weight of 65.31 carats, on offer for $1,752,600; a 40 carat VS2 / D round sparkler offered for $1.608 million; and a 6.67 carat, VVS1 modified pear brilliant, HPHT treated fancy purplish pink diamond for $1.2 million.
All of these are yours for the taking - if you are on the seller's pre-approved bidder/buyer list.
Just another day at the office.
Winter Olympics Slows Jewelry Buying on the Net.
Interest in the 2006 Winter Olympics drove significant activity, according to comScore Network’s monthly analysis of consumer activity at top online sites.
In February, jewelry, luxury goods and accessories ranked fifth, increasing eight percent to 14.6 million visitors compared with the previous month. Tiffany & Co. helped propel the category in February with 52 percent growth to 1.3 million visitors. However, compared with February 2004, the category saw a four percent drop off.
“Although Valentine’s Day drove up traffic in several categories versus the previous month, those categories actually experienced declines when compared to February of the prior year,” said Peter Daboll, president and CEO of comScore Media Metrix. “Conversely, heavy interest in the 2006 Winter Olympics propelled the Sports category to a 16 percent traffic gain and 32 percent increase in engagement over February 2005. It appears that the Olympics took away mindshare from Valentine’s Day during the middle part of the month, possibly resulting in softer sales for Valentine’s Day retailers.”
OK Gals, you're safe for another four years.
Blue Nile.Com Sales Up, Stock Down
Blue Nile's stock price sank in Februray, despite reports of record fourth quarter an full year sales.
The online diamond retailers net sales increased 20 percent to $203.2 million for the year ended Jan 1.
However, shares of BlueNile were recently trading at $30.85 down $6.44 or 17.4 percent on volume of about 2.1 million shares.
Additionally, if you research Blue Nile on the Internet you will see that the big honchos have been selling off their stock like crazy.
So what's up??
Tiffany To Open Two New Diamond & Jewelry Stores In China.
Luxury retailer Tiffany & Co., plans to open two new stores in China during 2006. One store will open at Beijing's Oriental Plaza, and a second store at Shanghai's Plaza 66. Beijing is scheduled to open in May, and Shanghai could open towards the end of the year, the company reports.
"The Oriental Plaza in Beijing and Plaza 66 in Shanghai are ideal environments for a Tiffany store," said Darren Chen, group vice president at Tiffany & Co. "These convenient locations expand our presence both in Beijing and Shanghai, cities of growing importance as global business centers and as destinations for both domestic and overseas tourists."
Once the new stores open, Tiffany will have a total of two stores in each of those prominent cities. Tiffany currently has a boutique in Beijing's Peninsula Palace Hotel, which opened in 2001, and a boutique in the City Plaza shopping complex in Shanghai, which opened in 2004.
How do say "Bling-Bling" in Chinese?
"Bring-Bring"!
Diamond Identification Method for Consumers: Bring Napkins
The Financial Times of London reports on a novel way to identify Diamonds from fakes:
It is said that Alexander the Great found a valley full of both diamonds and poisonous snakes. No one could work out how to retrieve the jewels until Alexander had the idea of throwing down raw meat, to which the diamonds attached. When eagles flew down for the meat, Alexander's men just had to follow them to their nests.
It sounds like fantasy but diamonds are attracted to fat, and the story reminded people how to tell real diamonds from fakes. De Beers still practise Alexander's trick in their South Africa mines today: They use "grease tables" and only the valuable stones stick.
Today, most engagement rings are diamond but after the war, people wanted holidays, cars or colorful gems to celebrate a future marriage.
In 1947 a New York copywriter, given the task of finding a slogan for her client's product, stayed late in the office. "I put my head down and said: 'Please God, send me a line.'" Then she scribbled: "A Diamond is Forever" and the rest is History.
Diamonds For Dogs!
They say diamonds are a womans best friend.
Apparently they are dogs best friend as well!
Check out this link.
Buying Loose Diamonds, Engagement Rings, Wedding Bands, & Wedding Rings: Trust and Verify.
Marshall Loeb of Market Watch quotes our friend and colleague, Jay Mednikow with advice to consumers on how to safely shop for loose diamonds, engagement rings, wedding rings and bands, both in jewlery stores and through internet websites. It is advice we agree with 100% and worth following.
Few purchases are more mystifying for first-time buyers than fine jewelry. There's more information out there than ever - from jewelers' Web sites and online forums to nearly ubiquitous grading reports from independent labs. But buying expensive gems and precious metals is still largely a matter of trust between you and the jeweler.
First, educate yourself on the basics. For diamonds, that means the four Cs: cut, color, clarity and carat weight. For gold, platinum and silver, it means purity.
You can find helpful information on these fundamentals from the Federal Trade Commission ( FTC) and the Better Business Bureau (BBB). The Gemological Institute of America, the most prominent diamond grading agency, provides tutorials on buying diamonds and colored gems at (GIA Education).
"It's less of a blind purchase than it used to be," says Jay Mednikow, president of 115-year-old Mednikow Jewelers in Memphis and Atlanta. "But a jeweler who knows what he's doing can take advantage of you if he wants to."
Thus, there is still no substitute for a reliable dealer with an established reputation. Many jewelers are GIA-certified gemologists and display their credentials prominently.
For diamonds, Mednikow recommends buying only those with grading certificates from GIA, the American Gem Society or another independent laboratory. If a jeweler says he can offer you an uncertified diamond at a discount, tell him you'll pay to have it analyzed since the cost should be only $50 to $300 depending on the size of the stone. Read warranty and return policies carefully and make sure all guarantees are written on your sales receipt - it's your legal contract.
You may have a hard time distinguishing between slight variations in color and clarity, but still trust your own eyes.
Mednikow recommends holding diamonds with a pair of tweezers over your finger or against a white background and under lights of different types and varying brightness. With shapes other than round-cut, which has standard specifications, and with colored gems, you will have to rely much more on the jeweler's expertise.
If you are buying a colored stone such as a ruby, sapphire or diamond, ask if it has been "treated" to enhance the color. Some processes are routine, like heating for sapphires and rubies and oiling for emeralds, but others are temporary or undesirable.
Up to half the gold jewelry sold in the U.S. bears a false karat rating, says Mednikow. Choosing a reliable merchant is your only insurance, although national retailers like Zales and Sears are diligent about the purity of their gold.
Guess Where You Can Buy Diamonds & Jewelry? You Won't Believe It!
Idex Research today reports that Specialty jewelers who lament that they are losing sales to discounters, department stores, and many other retail categories are correct. Just-released information from the U.S. Department of Commerce reveals that for every specialty jeweler in the U.S., there are three other merchants – whose primary business is not jewelry – who are also selling diamonds, precious metals, and other goods that have traditionally been the domain of specialty jewelers.
There are just over 128,000 retailers in the U.S. who sell jewelry in their stores, according to the latest Business Census data from the U.S. Department of Commerce. Roughly 28,000 of those stores, or about 22 percent of all jewelry retail outlets, are specialty jewelers; the others represent a wide variety of retail categories including department stores, general merchandise stores, warehouse clubs, apparel retailers, non-store retailers, and a number of other specialty retailers. The graph below illustrates the mix of specialty jewelers to total retailers of jewelry in the U.S.
Stores Selling Jewelry by Category
Percent of Total of 128,000 Stores
Source: Dept. of Commerce
Because jewelry is such an attractive industry – gross margins are healthy and the long term characteristics of demand are positive – there are many merchants who are trying to sell jewelry.
Further, as a result of few barriers to entry, retailing attracts a large number of merchants who will try to sell anything to make a profit.
The bad news for specialty jewelers is that they are losing market share to those merchants whose business is not primarily selling jewelry. Over the past decade, specialty jewelers’ market share in the U.S. has dropped from about 50 percent to just over 47 percent, as the graph below illustrates.
There may be some surprises among the list of retailers who are gaining – and those who are losing – market share in the jewelry category. As expected, non-store retailers have among the strongest growth of any retail category. Stores that retail sporting goods, hobby supplies, books, and music (a single category, according to the Department of Commerce) have also posted strong jewelry sales gain, though this category generated an aggregate of just over $100 million in sales. That was just enough to be included on the Idex list, which analyzes only retail categories with $100 million or more in annual jewelry sales.
A graph of those retail categories that are gaining market share and those which are losing market share is shown below. These are all of the retail categories which report that they have $100 million or more of jewelry sales annually.
U.S. Specialty Jewelers’ Market Share
Source: Dept. of Commerce
Who Is Taking Jewelry Market Share?
Sales Growth over Past Ten Years by Retail Category
In addition to the list of logical purveyors of jewelry, there are a number of surprises on this list of jewelry outlets. For example, the Commerce Department’s Business Census, lists 117 stores which primarily sell beer and wine that also sell jewelry. You can gas up your car at 178 gasoline stations that also sell jewelry. In addition, there are about 385 convenience stores (such as 7-Eleven) which sell jewelry; 1,210 book stores sell jewelry; and, 37 pet stores also sell jewelry. In the prior Business Census (1997) about 85 automobile dealers also sold jewelry; by 2002, however, those car dealers apparently had stopped selling gemstones and watches.
Here’s an exhaustive list of all merchants who sell jewelry, but whose primary product line is not jewelry.
* Furniture & furnishings stores
* Consumer electronics stores
* Appliance stores
* Home centers, including building materials, lawn & garden supplies, nurseries, farm supply and hardware stores
* Grocery stores, supermarkets, convenience stores
* Fruit, vegetable, confectionery, and nut stores
* Beer, wine, and liquor stores
* Cosmetics, beauty supplies, and perfume stores
* Optical goods stores
* Gasoline stations
* Clothing stores, including men’s wear, women’s wear, children and family clothing, shoe stores, and infants’ stores
* Luggage and leather goods stores
* Sporting goods, hobby, and musical instrument stores
* Sewing, needlework, and piece goods shops
* Book stores, news dealers, college book shops
* Music stores
* Department stores
* Warehouse clubs
* Variety stores
* Florists
* Office supply, stationery, and gift shops
* Used merchandise stores (pawn shops are included in this category)
* Pet stores, art dealers, tobacco stores
* Electronic shopping and mail-order retailers
* Vending machine operators and direct selling, including in-home sales
Loose Marquise Diamond Shape: What to Look For.
The Marquise Brilliant takes its name from a legend that the Sun King desired a stone to be polished into the shape of the mouth of the Marquise of Pompadour.
The Marquise Brilliant is a boatshaped modified brilliant. It is generally agreed that a length-to-width ratio between 1.75:1 and 2:1 is most pleasing. As with other fancy shapes, a certain degree of what constitutes a beautiful shape has to do with the consumer's individual taste. The ultimate shape of the finished diamond is determined by the rough and what parameters it allows. The typical Marquise Brilliant contains 56 facets.
Of concern to consumers when evaluating a marquise shape diamond is the appearance of a visual pattern called a "bow-tie" which looks exactly like that, right in the center of the diamond. It is true that an extreme bow-tie can be jarring and unattractive to the eye, but some amount of bow-tie is beneficial to the visual appearance of the diamond as it provides contrast brilliance and makes the stone stand out in sharper detail.
Minimal bow-tie indicated by the arrows.
An example of a beautifully cut marquise diamond is shown below.
Zales COO Resigns.
Management shifts continue at Zale Corp. as the company announced the departure of another top executive, Sue Gove, executive vice president, chief operating officer and member of Zale's board of directors.
Gove resigned as an officer and director effective immediately, according to a Zale release issued Thursday. She follows former CEO Mary Forte and former Zales Jewelers' president Paul Leonard, both of whom left the company earlier this year.
"The company would like to thank Sue for her many contributions over the last 25 years, and we wish her well in her future endeavors," Richard Marcus, chairman of Zale's board of directors, said in the statement. "We are very appreciative of the talent, dedication and passion she brought to the business."
Zale is currently operating with an interim CEO, Betsy Burton, and has not named a successor to Forte.
Expect a continued Management shake-up at Zales who have been losing money at a rapid rate as we have chronicled here: Zales Loss . Increased competition from the Internet and the flight to diamond and jewelry quality by consumers are a few of the reasons for Zales downward spiral.
I hope the Zales Board of Directors at least gave her a Gold Watch on her way out the door.
David Yurman Jewelry: Evolution of a Jewelry Designer.
The Orlando Sentinel has an interesting feature on David Yurman today.
David Yurman jewelry is like your favorite blue jeans -- only much more expensive. The jewelry is "comfortable," says Yurman, 63, who recently visited his new boutique, which rubs shoulders with Cartier and Tiffany in Orlando's Mall at Millenia.
The jewelry is also versatile, he says. "You can wear it anywhere, day to evening." Just like blue jeans.
It wasn't always that way with jewelry. Before the 1980s, when Yurman's now-iconic cable bracelets became the most coveted, and copied, arm candy in the United States, there were two kinds of jewelry: Costume for everyday wear, and fine jewelry for special occasions.
The relaxed elegance of Yurman's designs bridged the divide. The jewelry is classic but with a modern twist that gives it go-anywhere elan.
Fashioned from gold and silver, many pieces also feature coral and turquoise, a sparkling array of gemstones and Yurman's current favorite, South Seas pearls. Signature motifs include a squared "cushion" shape, a hook-and-eye closure and the widely recognized twisting "cable" pattern.
The designs are "a combination of art, fine jewelry and fashion," says Yurman, who wears several of his creations: A ring, a bracelet and a square-faced watch.
Dressed all in black, his thick white hair swept straight back, his chin fashionably stubbled, he looks every inch the artist from Tribeca, the New York neighborhood where he and his artist wife, Sylvia, live and work.
Before designing jewelry, Yurman was a sculptor, hanging out with prominent Beat artists of the 1960s; writer Norman Mailer, painter Franz Kline, sculptor Ron Boise.
"I did these funny little silver angels," he says.
It was one of those angels, fashioned into a belt buckle, that sparked his career as a jewelry designer.
The buckle was a gift to Sybil, his girlfriend at the time. She wore it to an art opening, where it caught the eye of the gallery owner. He asked if it was for sale. Yurman said no, but Sybil said yes -- and within weeks they found themselves in the jewelry business.
Ever since, they've had good-luck angels perched on their shoulders. Their collections are in more than 450 stores around the world, and David Yurman is one of the best-known luxury brands on the planet.
Gwyneth Paltrow and Barbra Streisand wear the jewelry; Steven Spielberg and Kevin Spacey the watches; hip-hop moguls Jay-Z and Damon Dash the men's designs. Their ad campaigns have featured models Amber Valetta and Kate Moss, and the company's newest "face" is Naomi Watts -- who recently flashed Yurman earrings of rose quartz and diamonds at the Oscars.
Orlando real estate agent Virginia Morales, 49, collects Yurman bracelets. "I wear three, four at a time," she says. "My husband always knows what to give me for my birthday, anything David Yurman."
Since founding their company in 1980, the Yurmans have worked as a team.
"I have the vision; I design the collections," explains Yurman. "My wife does the styling and merchandising."
Their son, Evan, is part of their ever-expanding creative team. And let's not forget the lawyers.
The couple's designs, which range from about $300 for a simple bracelet to more than $7,000 for a multistrand couture necklace, are among the most copied in the world. Yurman is not flattered by imitators and spends $1 million a year protecting his brand.
"Copying is stealing," he says. People who wear copies are deceptive. "And that's not cool."
Worse, he says, they are supporting counterfeiters who may pay no taxes, have ties to illegal operations or use child labor.
As his company grows, Yurman finds himself more in the role of executive than artist.
"It's less like playing an instrument, more like being the leader of the band," he says. "I'm about ready to do more art work."
But that is not likely to happen anytime soon. First, he plans to introduce a line of Yurman eyewear and a Yurman fragrance, followed by Yurman handbags and luggage.
No wonder he believes in angels.
Tiffany Sales Up, Profits Down.
Tiffany & Co.’s overall net sales in fiscal 2005 rose 9 percent to $2.4 billion, and profits fell 16.3 percent to $254.7 million.
Tiffany’s attributed the decline in profit to a one time gain in December 2004. In fiscal 2004, earnings in the fourth quarter and year benefited from a pre-tax gain of $194 million as a result of the company's sale of its shares in Aber Diamond Corporation.
Retail sales in the United States rose 9 percent to $1.2 billion during the fiscal year, same-store sales rose 7 percent (branch store sales rose 7 percent and New York flagship store sales rose 5 percent.) Tiffany’s attributed comparable store sales growth to higher spending per transaction. Tiffany’s opened four stores stateside in 2005 and operated 59 Tiffany & Co. stores by year-end 2005.
Diamonds Are A Girl's Best Friend, NOT Moissanite.
Shares of jewelry maker and sole source of moissanite Charles & Colvard Ltd., fell on March 27, a day after the company forecasted lower quarterly sales due to substantially lower orders from K&G Creations.
Shares dipped $1.73, or 12.8 percent, to $11.75. The stock price is down 27 percent so far this year, adjusted for stock splits.
In a company statement on March 26, Charles & Colvard said sales for first quarter fiscal year 2006 are expected to be between $7.5 million and $8.4 million, which is 25 percent to 33 percent lower than a year ago. The company expects K&G's orders to slip due to lower orders from the 2005 merger of its customers, Federated Department Stores and May Department Stores Co.
Charles & Colvard’s board authorized the repurchase of up to one million common shares. Company shares have traded between $8.63 and $26.29 over the past year.
Loose Cushion Cut Diamond: What Is It?
The Cushion Cut is a generic name for the Old Mine Cut developed before the turn of the century; these days the name" cushion" is often used for colored stones cut in this shape.
A Cushion Cut is a square or squarish-rectangular cut with rounded corners and 58 brilliant-style facets that resemble a pillow shape, hence the name.
A hundred years ago, when Cushion Cuts were first developed, diamonds were not cleaved into two pieces of rough, as they are today; they were ground down as a single stone and the resulting polished was lumpy and thick. Cushion Cuts have very thin girdles and bigger culets than today's full-cut diamonds.
Designers are requesting Cushion Cuts with big culets, but, in general, the smaller the culet, the better the stone. Older Cushion Cuts return light in blocky patterns; newly cut ones return light in needlelike patterns.
MARKETS AND MARKETING
Cushion Cut diamonds are popular in matching pairs. They are especially being used in larger-carat earrings and also as a center stone in rings. Cushion Cuts first became popular again about ten years ago, and their popularity has increased as designers and antique dealers continue to use them.
Cushion Cuts offer a lot of weight at a moderate price. Larger Cushion Cut diamonds sell for about 30 percent less than full-cuts of the same weight, while smaller cuts sell for about the same. A 1-carat G/VS Cushion Cut stone will sell from $2,800 to $3,800. Two-carat and up stones sell in the $3,500 to $5,000 per carat range. The most popular sizes are .75 to 1.5 carats. The availability of 2-carats and up is a problem because of the high demand for larger stones, both by estate and antique dealers for replacement or repair and by manufacturers.
Look for good clarity and color. Because Cushion Cuts have very thin girdles, girdles on older ones are often chipped. Look for Cushion Cuts that are symmetrical; off-shape ones are difficult to use. Look for a medium culet that is not too heavy, unless you have a special reason to use this cut with a big culet. Pick a mounting that's appropriate for the softer reflections and refractions of a Cushion Cut. Old Mine Cuts were traditionally set in yellow gold or silver with a patina or oxidation; therefore, they look better set in matte metals rather than highly polished ones.
Odimo.com In Financial trouble
Odimo.com, one of the Internet's first diamond and jewelry websites is in deep financial trouble.
Online diamond retailer Odimo Incorporated alerted investors that the company requires additional financing to "continue its operations, meet its operational goals, and to pursue its long term strategy."
Odimo's fiscal year ended December 31, 2005, and the company released its fourth-quarter and year-end results after the markets closed on March 30. Odimo owns www.diamond.com, www.ashford.com, and www.worldofwatches.com.
In its financial statement, Odimo states: "The company is currently implementing strategies that include: (i) reducing costs, (ii) seeking equity and debt financing, and (iii) exploring the sale of the company or certain assets. There is no assurance that the company will be able to successfully implement any of these strategies. The financial statements do not include any adjustments that might result from the outcome of this uncertainty."
During the year, and as part of cost-cutting measures, Odimo and SDG Marketing agreed to terminate their agreement, to which Odimo returned $3.7 million (and $700,000) in diamond inventories to satisfy payables.
Losses for the fourth-quarter at Odimo grew to $13.9 million from $1.7 million one year earlier. Sales fell 14 percent to $18.5 million.
For the fiscal year 2005, Odimo sales were flat at $52 million, and orders decreased during the year by almost 3 percent to 151,700. The average order value however increased 3.4 percent to $387. Gross profit was 24 percent of net sales, or $12.5 million, down from $15.1 million in 2004.
Loss from operations was $23.4 million, up from $12.5 million in 2004, inclusive of a $9.8 million non-cash charge to record the impairment of goodwill.
Engagement Ring Purchase onThe Internet: Is This A Good Deal?
Is the question being asked by a consumer this morning on Diamondtalk.com. He has seen a Princess Cut that is being listed on EIGHT different internet diamond websites at different prices!!
Discussion is here: Good Deal?
Here are the multiple listings for this one diamond:
Who really has this diamond?
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42x7.27x5.21 $6209 $13847*SP
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42x7.27x5.21 $6262 $13964SP
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42-7.27-5.21 $6276 $13996*
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42x7.27x5.21 $6291 $14029
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42x7.27x5.21 $6306 $14062*S
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42x7.27x5.21 $6308 $14066*SP
2.23 I VS1 71.7% 72% GIA med-stk no gd vg no 7.42*7.27*5.21 $6339 $14136*S
2.23 I VS1 71.7% 72% GIA med-sl thk no gd vg no 7.42x7.27x5.21 $7198 $16051
This diamond is supplied by the manufacturer to many internet websites and is known as a "Virtual Diamond".
Little if any information is provided save for a few numbers off the lab grading report and the price. You are buying blind.
We have blogged on this topic several times. Same Diamond Listed All Over The Internet?
Virtual Diamond (VD) databases do not give you the necessary information you need, e.g.; photo's, Imagescopes, and light performance data such as provided by the Gemex Brilliancescope. As such, these lists are useless. Would you buy a Home this way? I doubt it. Why should your diamond purchase be any different. It's also big money.
This is a big purchase not only because of the money, but even more so because of the emotion and psychology behind it. You need to get this right the first time. Work with Internet websites that give you comprehensive information.
Hearts On Fire To Replace The Dog with Diamonds, As Man's Best Friend.
Don't tell the family dog, but Hearts on Fire is making a bid to replace a man's favorite canine companion with diamonds.
The company announced that it is challenging the notion that custom diamonds are only gals' best friend by introducing a loose diamond program aimed specifically at men. The new platinum collection, "Distinguished," offers rings, bracelets and cuff links as semi-mounts for diamonds of male customers' own choosing.
"Men are wearing more and more diamond jewelry, and are demanding more of a selection, much like women have," designer Katherine Rosenberg-Pineau, Hearts on Fire vice president of product development and merchandising, said in a release. "Why shouldn't men be able to select the diamond of their choice, too? The 'Distinguished' collection offers this."
In platinum, the collection retails from $5,900-$20,000. Hearts on Fire touted Olympic Gold medalist Apolo Anton Ohno in its release, who wears the brand's "DreamStone Talisman" around his neck. It retails for $16,000.
Lose Your Engagement Ring, Diamond Ring, Wedding band? Try This Internet Lost & Found Website!
The Associated Press today reports an item of interest: There is now an Internet Website where you can post your lost Engagement Ring, Diamond Ring and Wedding Band.
Maureen Silliman felt her empty pocket and gulped: Her new $300 iPod must have bounced out as she ran to catch a train.
While she sobbed, her boyfriend suggested a message on the lost-and-found section of Craigslist, an online bazaar of classified ads.
"No," the 24-year-old Silliman said. "Nobody would ever turn in an iPod."
Her boyfriend posted the message anyway. Within 24 hours, Silliman's iPod was back.
In an increasingly cynical world, there are still places where people try to do the right thing. Everyday on Internet message boards, honest folks post notes about valuables they found: cash, bank cards, diamond bracelets, engagement rings, wedding bands, digital cameras, and even a cockatoo valued at $1,200.
In turn, when there is no place left to look for something missing, the desperate sometimes take the longest of longshots and look online themselves.
Occasionally, it works for both sides. People such as Silliman get back their iPod, still loaded with Radio Head and Broken Social Scene.
The impulse to be honest doesn't surprise Lawrence M. Hinman, the director of The Values Institute at the University of San Diego.
"I think we perceive ourselves as being much worse than we actually are," Hinman said. "There are people who live lives of quiet honesty."
Take Monique Peddle, 48, in Hollywood, Fla., who posted a note online when she found a diamond studded gold bracelet that she could have just as easily slipped quietly in her pocket.. Or Blake Facente, 30, who also turned to Craigslist when he discovered a Dell Inspiron laptop leaning against his building in San Francisco.
The same for Agnes Satoorian, 27, who climbed into a cab in Boston last month and found a pricey digital camera that another rider had left behind.
"I know that pain," said Satoorian, who had recently lost her own camera loaded with sentimental pictures. "I decided I would try to make it right for someone."
Craig Newmark, the namesake and founder of Craigslist, said that the company added the lost-and-found message board in March 2003 after they noticed a proliferation of people looking for things that they were missing.
"The culture of trust is key, and the fact is that we work really hard at that," said Newmark, 53, who now has Web sites in 190 cities that boast more than 10 million users a month.
That means everyday there are new lost-and-found posts. Like the drawer in a school secretary's office where missing scarves wait to be claimed, the message boards accumulate a disparate collection of goods.
Some are outlandish.
The three teeth -- including a molar with a filing that needed replacing -- pick up in downtown Honolulu. The $100 bill found on a sidewalk on the Las Vegas strip. The man in Copenhagen who lost his ex-wife. Or the New Yorker who misplaced her clean-shaven cowboy and implored: "If found please send him to Queens."
In the lost column in Dublin, Ireland, a post under the heading, "$1 Million US reward," has a link to the FBI's Ten Most Wanted poster for Boston fugitive mobster James "Whitey" Bulger.
"I just want him caught," said the post's author, reached through e-mail, who declined to elaborate or give his name.
Other posts are authentic, and even touching.
The 39-year-old woman in Frankfurt, Germany, looking for her birth mother (Bridgitte Siglinde Stolba). The Homestead, Fla., mother searching for a lost dog named Sparky that detects her 17-year-old epileptic son's seizures and barks for help. The 1-carat diamond engagement ring that slipped off a woman's finger in the hills outside Berkeley, Calif.
Success of the Lost and Found is difficult to measure. Craigslist does not track its sites, and the free posting are only valid for 30 days.
But as stories about triumphs like Silliman's iPod circulate, more people keep playing the odds.
Last Fourth of July, scuba diver Stephen Klink found a solid platinum men's wedding band buried in sand beneath 30 feet of water off Cape Cod. Klink, 36, recently posted a note on the Boston-area Craigslist.
"It's a long shot, but I figured it's worth a try," Klink said from his home in Hillsdale, N.J. "Some married guy somewhere is getting whopped on because he lost his wedding ring."
"Diamonds Are For Ever", But Are Diamond Mines?
Cramer's Mining Weekly reports that the slogan "Diamonds may be forever", but the same cannot be said of diamond-mines.
While De Beers Consolidated Mines (DBCM), the largest producer of diamonds in South Africa, produced a record 15,2-millioncarats last year, it estimates that it will produce just over 14-million carats this year.
Part and parcel of new DBCM MD David Noko’s strategy is to sweat the company’s existing assets, and bring new, additional production on line.
“I do not think that we can grow production from our existing operations – we just can’t.
“Our installed capacity is fixed, and we need capital to improve it,” Noko, who was appointed as DBCM MD on February 7, tells Mining Weekly in an exclusive interview.
And, gaining approval for brownfield projects that do not meet the hurdle rates of the company’s principals is out of the question.
“There would be no point in injecting capital into declining mines like The Oaks, as a return would not be realised, but, by exception, all opportunities are being explored, the major ones being brownfields, but some being greenfields through finding partners that have large resources,” Noko says.
Hence, besides organic growth projects, DBCM’s growth strategy is levered on partnerships with smaller diamond-mining companies.
“If we partner with smaller companies, they will benefit from our knowledge, while we will benefit from the resources that they have acquired,” Noko says.
DBCM has many partnerships in Kimberley, where it has large tailings dumps that require advanced technology to turn the low grades of diamonds that they contain to proper account.
The company is also continuing to research the opportunities of working with junior miners and, in Kimberley, already 25% of revenue emerges from joint ventures with junior miners through contracts.
Diamond & Jewlery at Retail: How Much Money Is Involved?
The US jewelry retail industry generates annual revenues of about $44 billion from 28,000 specialty, department, and discount stores. Specialty retailers hold about 50 percent of the market. Wal-Mart is the biggest jewelry retailer in the country, followed by Zale, the biggest specialty jeweler with over 2,000 stores and kiosks. The industry is highly fragmented: the top 10 jewelry chains hold less than 25 percent of the market. Other large specialty retailers are Tiffany and Sterling, the US branch of British jeweler Signet Group.
Jewelry sales depend partly on consumer income. Small jewelers can effectively compete with large chains because price isn't the main factor determining retail sales. Profitability depends on the volume of sales because sales costs are high and fixed. Because gross margins are very high, often 50 percent, mass merchants like Wal-Mart have taken market share by controlling costs and cutting prices.
Jewelry is often classified as bridal merchandise (engagement, bridal and anniversary rings - about 35 percent of the market); fashion jewelry (rings, bracelets, earrings, pins, gold chains); and watches, silver flatware, and other giftware. Diamond jewelry and loose diamonds account for the largest share of total jewelry store sales (46 percent); gold jewelry for 11 percent; colored gemstone jewelry (rubies, sapphires, emeralds, etc.) 9 percent; and watches 4 percent.
Tiffany's Lucida Diamond: What is it ?
Tiffany & Co.'s Lucida is an exclusive patent pending diamond cut whose shape is a square mixed cut. It has 50 facets, a high crown, stepped facets, wide corners and a small table with a brilliant pavilion. The design of the cut maximizes the stone's sparkle and brilliance. A photo is shown below.
AGS-0 Ideal Cut Princess Diamonds have similar sparkle to the Tiffany Lucida, without the price tag!
Lucida Diamond.
Tiffany has added an eternity band and a three-stone ring as well. Lucida, which means the brightest star in a constellation, is available exclusively at Tiffany & Co. stores worldwide. The setting is copyrighted and the diamond has multiple patents pending.
The Lucida diamond is made from the same rough as a well-cut round. Created by Tiffany's gemologists, the cut is similar to the Asscher and antique Cushion Cuts. Tiffany showcases the Lucida cut in a special four-prong ring shown below. The sculptural band has clean lines and soft curves that merge with the prongs in a sloping crisscross design, which, when viewed from the side, is reminiscent of cathedral arches.
Lucida Ring.
Lucida was designed and introduced by Tiffany in 1999. The retailer has positioned the collection to fit between its classic Tiffany setting and its cuttingedge Etoile collection and has become something of a status symbol. The worldwide launch was backed by an extensive advertising campaign that included four-page inserts, spreads and single-page units in fashion and lifestyle publications. The Lucida is available at 150 locations internationally, including Japan, France and London.
Each Lucida diamond is sold with a Tiffany Certificate. The inside shank of each ring is currently engraved with the following: Copyright, Tiffany & Co. Lucida, metal fineness and the phrase "patents pending." When the patents are finalized, the actual patent numbers will be engraved in the shank.
Click on the icon below for a stunning collection of the finest Tiffany style diamond engagement rings and Ideal Cut diamonds at outstanding values!!
Do You Know How To Buy Your Diamond Engagement Ring?
NOT as this couple unfortunately found out. Be A Smart Diamond Shopper
We totally agree. Here are our recommendations for your safe diamond engagement and wedding ring shopping:
1. Work with a reputable Jeweler; be it Brick & Mortar (B&M) or Internet. Check with your local BBB and the Jewelers Vigilance Committe (www.jvclegal.org)
2. Know what you're buying. Make sure your diamond has a lab grading report. The two most stringent, accurate, and consistent diamond grading labs are the GIA (Gemological Institute of America) and the AGS (Americn Gemological Society). Insist on them.
3. If you're more comfortable shopping with a B&M Jeweler, look at as many diamonds as you can and away from the diamond counter's high intensity halogen lights which tend to make even the ugliest darkest diamonds look D-Flawless.
4. If you're shopping with an Internet Diamond vendor, make sure that they can examine the diamond for you to determine if there are any red flags you need to know about which would dissuade you from buying the stone.
A great number of Internet Vendors sell of Virtual Diamond (VD) databases and never see the diamond you're buying. The diamond is drop-shipped directly to you from the manufacturer. We covered this topic in more detail here: Cyberspace Diamonds
5. Ask the Internet Vendor to supply you with as much information as possible, including photo's.
6. Be clear and understand the Vendor's Policies: Payment, Returns, Upgrades, etc. and any timelines or deadlines that might accompany these Policies.
7. Ask about and receive any paperwork that comes with the diamond.
8. Stay away from in-house Appraisals. Such Appaisals are inflated, will cost you undue high insurance Premiums, and is a practice that is frowned upon and not sanctioned by the reputable National Association Of Jewelry Appraisers (NAJA). Best is to get an evaluation and Appraisal from an Independent Appraiser that does not work for a Jewlery store and does not sell their own diamonds and jewelry. Contact NAJA for a llisting and location of such Appraisers.
Shop Smart. This is a big purchase not only in terms of money but also in terms of emotional significance.
Good Luck!
It Is Safe To Buy Your Diamond Engagement Ring On The Internet.
According to recent statistics from comScore Networks, online sales are already up in 2006. Gian Fulgoni, comScore chairman, said in a January press release, “The 2006 year opened on a strong note, with solid growth of 33 percent in online nontravel sales versus the same period in 2005.” He went on to optimistically predict, “It’s clear based on what we’re seeing so far in 2006 that the strength in online sales will not wane anytime soon.”
According to a comScore press release: “The growth in 2006 online consumer spending follows a year of solid gains. Total online spending for the full year 2005, including travel, reached $143.2 billion, up 22 percent over 2004. Online nontravel spending in 2005 accounted for $82.3 billion, an increase of 24 percent over 2004 levels.”With this kind of money at stake, the question is not whether a business can afford to set up an online store. The question is whether a business can afford not to.
Sales of Loose Diamonds, Diamond Engagement Rings, Diamond Rings, and Wedding Bands by reputable Internet vendors are increasing at a rapid clip. Information on the Cut quality of the diamonds such as lab grading reports, photographs, and light analyses help consumers "see" the diamond on-line and provides very useful information to making an informed purchasing decision.
Keep in mind that buying your Diamond Engagement Ring through an Internet Vendor demands the same caveat Emptor and verification as does shopping with a Brick and Mortar Jeweler.
We discussed and covered several important DO'S and DON'TS just yesterday in this Blog Entry.
Buying Your Diamond in Cyberspace
To paraphrase Sy Sims: An educated consumer makes for a very good and happy customer.
Zales Facing SEC Probe; Stock Price Drops 9%.
Diamonds may be forever, but at beleaguered jeweler Zale (ZLC: 25.16, -2.64, -9.5%) new management is surely hoping that an investigation by the Securities and Exchange Commission will be short-lived.
Shares of the Dallas-based specialty retailer lost some of their sparkle Monday, falling 9.5% after Zale disclosed the probe. The SEC subpoenaed records relating to accounting for extended service agreements, leases and accrued payroll, as well as for executive compensation, severance, earnings outlooks and stock trading.
MarketWatch sums up Zales plummeting fortunes this year thus far culminating with today's announcement that it is facing an SEC investigation.
It's more bad news from a company that has seen three top executives resign this year amid sagging sales and a slumping stock price.
"It's very murky," says Bill Armstrong, an analyst for C.L. King & Associates, a boutique research firm in Albany, N.Y. "According to what they told me, they don't even know what the SEC is looking for, as far as what it's investigating. The SEC communicated to them in very general terms."
Zale Treasurer David Sternblitz says regulators have offered little information beyond the request for records. The company has already publicly elaborated on its accounting practices for extended service agreements and leases, he says, and KPMG, Zale's auditor, has consistently given Zale a clean bill of health. "We will be cooperating fully, and the company believes that it has complied with generally accepted accounting principles," Sternblitz says.
The company's 2,345 stores in the U.S., Canada and Puerto Rico, as well as its online division, had sales of $2.38 billion in 2005 and are on track for sales of $2.40 billion this year, according to analysts surveyed by Thomson First Call. Its Zales Jewelers division accounts for about half of all revenue, and an average sale is between $200 and $300, says Armstrong. Other brands include Zales Outlet, Gordon's Jewelers, Bailey Banks & Biddle, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda.
For its fiscal second quarter ended Jan. 31, Zale's earnings fell 7% year-over-year to $1.78 a share. The company reported a profit of $1.96 a share, but that figure didn't conform to generally accepted accounting principles.
The Feb. 21 earnings announcement came on the heels of the January resignation of Mary Forte, president and chief executive, and the February resignation of Paul Leonard, president of the Zales Jewelers division. Sue Gove, chief operating officer, quit last month. Mary E. "Betsy" Burton was named interim CEO on Jan. 31.
Change at the top can muddy the waters beneath, says Alan Ratliff, a partner at Stone Turn Group, a forensic accounting firm in Houston. Generally, he says, situations like the one at Zale could attract some extra attention from regulators.
"I would say that every one of those [areas covered by the SEC subpoena] listed is the subject of one or more interpretive accounting standards, where someone could interpret it in a particular way and be just over the line," Ratliff says. "In the context of a company where the top management resigns or gets fired, it could be something like that."
The timing of extended service agreement revenues, in particular, is an area that's ripe for trouble, says Ratliff. "When do you report revenue? Over the life of the contract, or immediately, and then have an immediate result?" he says. "If someone reports that as revenue to make things look better, or creates a huge reserve they don't necessarily need, the issues of timing can come up anytime."
Sternblitz agrees the recent management turnover is likely a reason for the SEC's interest.
"My guess would be that requesting this type of information, such as earnings guidance and compensation, is probably standard practice in order for the SEC to determine if any person profited from the issues that are in questions," the treasurer says. "Some of our executives are scheduled to talk to the SEC next month, but they haven't given us a timetable in terms of their investigation."
Zale's main priority apart from the investigation is to find a new CEO, says Sternblitz. The company has a short list of candidates and should name a new chief within three months.
Shares are down nearly 20% since. Management upheaval, disappointing financials and now accounting questions have contributed to the decline.
That said, the jewelry business isn't such a bad place to be as the population of aging and affluent customers expands. "In general, baby boomers are in their peak earnings and jewelry-buying years," says Armstrong. "I think demographic trends are generally favorable to the jewelry industry."
Unfortunately for Zale, others are lining up to lure those deep-pocketed shoppers. The company faces intense competition from Kay Jewelers, its retail rival in malls across America, as well as from jewelry departments at larger retailers such as Wal-Mart Stores (WMT: 45.70, -0.32, -0.7%), J.C. Penney (JCP: 58.47, -1.54, -2.6%), Kohl's (KSS: 53.95, +0.55, +1.0%) and T.J. Maxx (TJX: 24.41, -0.06, -0.3%).
Zale's new management needs to move away from heavy promotional discounts and regain market share, wrote Brian Tunick, an analyst at J.P. Morgan, in a Feb. 17 research note that came out just after Valentine's Day, a key time for jewelry purchases. Zale's business prospects will become clearer, he wrote, by year's end once the critical holiday gift-giving season has come to a close.
Hey Guys: Can Diamonds Buy Women Love? Guess Again.
Diamonds are a Girls Best Friend. Right?! Well, fellas, not according to a survey just released by True, an on-line relationship service. They found (surprisingly?) that women value Love and a long-term committment-relationship more than diamonds and jewelry.
Read the results of their survey here: Love Or Diamonds?
From Israel Comes The Divine Diamond
National Jeweler reports of the design of a special diamond shape that takes a page from a fiction bestseller to hopefully drive sales. This is the focus of Israeli diamond designer Shlomo Cohen, credited with developing the Princess Cut in 1982.
Now, taking the idea of the "Golden Ratio" or "Divine Proportion" popularized by author Dan Brown's phenomenally successful novel, The Da Vinci Code, Cohen has released "The Vinci Diamond," a 62-facet "pentacle" cut incorporating the Divine Proportion's precise ratios.
h its table. In the end, he met this challenge: Three pentacle shapes, conforming to the exact dimensions of the Divine Proportion, are visible.
"The completion of my work at the same time as The Da Vinci Code has enjoyed such amazing international success is a happy coincidence," Cohen said. "And, the fact a major Hollywood movie by the same name will soon be released is an added bonus."
The cut has been patented in Japan, Israel, Belgium and the United States.
Fad or a diamond design that will withstand the test of time? We have blogged on this topic previously here:
New Diamond Shapes: Here Today, Gone Tomorrow?
On-Line Ads , Paid Search Increase
NetRatings AdRelevance service by neilsen reports that advertisers purchased 185 billion displays in March, which was double the amount one year earlier, and 31 percent higher than February's ad-spending total. Retail goods and services accounted for about 15 percent of the total (1 percent higher than March 2005.)
While the number of search engine inquiries continue to grow, according to Nielsen//NetRatings, Google holds steady as the No.1 search engine with 49 percent of activity, Yahoo! drew 23 percent of traffic, and MSN attracted 11 percent.
At press time, the top sponsored pay-for-click advertisers for "diamonds" on Google were: Ross Simons Diamonds, Blue Nile, and Yehuda Diamond Company. On Yahoo! the top paid links were Bidz.com (jewelry auction website,) Yehuda, and Blue Nile. On MSN, Blue Nile takes the top spot, followed by McGivern Diamonds, and Shopping.com.
Users hit the search engines for pictures of goods and for comparison shopping information, which has become an important part of the consumer shopping experience in the past two years. The number of searches in February 2006 grew 38 percent from one year earlier to about 5.3 billion.
Broadband use has grown 28 percent since February/March 2005, to reach 96 million homes in the United States or 68 percent of Internet users.
Buying Diamonds and Jewelry on the Internet has come of Age.
Iran Affecting Diamond & Jewelry Prices.
Commodities prices roared to new peaks on Tuesday as fund buying restarted, triggered by fears over the nuclear stand-off in Iran and the impact of surging economic growth in China, investors said.
The oil market hit a new record peak, taking key industrial metals prices with it and propelling precious metals to their highest since the early 1980s.
"The fundamental factors are the intensifying of the political situation in the Mideast Gulf and the Chinese GDP figures, which got everyone back to thinking China is eating up global natural resources," a fund manager said.
China's economy is on course for growth of at least nine percent this year signalling accelerating imports of energy and raw materials.
Fears about Iran's row with the West over the country's nuclear program sparked oil's latest rise.
IPE Brent crude set a fresh high of $72.20 per barrel before falling to $72.03 at 0847 GMT.
Brent has rallied from below $60 in December, buoyed by a fresh flow of fund investment amid mounting concern over Iran and the possibility of U.S. military action against the world's fourth largest oil producer.
"If we look forward it's continued economic growth and a potentially disastrous situation in the Mideast Gulf," the fund source said.
Most commodity indexes, which between them have attracted around $80 billion of speculative investment into the markets, are weighted heavily towards oil.
Fasten Your seatbelts!
Mothers Love Diamonds.
Children, Mother's Day is fast approaching.
Mother knows best...when it comes to driving gift sales, as American moms are expected to motivate $13.8 billion in retail gift buying this year, finds the National Retail Federation (NRF) 2006 Mother's Day Consumer Intentions and Actions Survey.
Jewelry gifts are expected to account for $2.1 billion In Mother's Day sales, compared to the $1.7 billion spent on jewelry for the holiday last year. That's second only to the $2.8 billion that NRF's survey indicates will be spent taking moms out for brunch or dinner, up from the $2.2 billion shelled out for celebratory Mother's Day comestibles in 2005.
The average Mother's Day shopper expects to spend $122.16 this year, according to NRF, up from $104.63 last year. Popular gifts include: greeting cards, which 85.4 percent of respondents said they'll be giving mom this year; flowers, which 67.6 percent of respondents expect to purchase; gift certificates or gift cards, on the list for 31.9 percent of shoppers; books or CDs, which 25.8 percent plan to give; and electronics or computer-related accessories, which 6.7 percent plan on giving mom.
"Consumers certainly enjoy splurging on luxury items, such as fancy meals and jewelry, but greeting cards and flowers still remain favorite tokens of their appreciation," Phil Rist, vice president of strategy at BIGresearch (which conducts the NRF survey), said in an NRF release. "No price tag is too high when it comes to showing mom the love and appreciation she deserves."
Men are expected to spend more than women on the holiday, with the average male expected to devote at least $148.51 on mom, compared to the $97.72 women are expected to spend.
Moms aren't the holiday's only gift recipients, as 20.7 percent of respondents to NRF's survey said they'd be buying for wives this Mother's Day; 9.1 percent for daughters; 8.5 percent for grandmothers; 7 percent for sisters; 7 percent for friends; and 12.3 percent for other relatives.
Young adults, ages 18-24, are this year's big spenders, dropping $142.40 per person this Mother's Day, up from the $96.08 they put toward mom last year. Those aged 45-54 are expected to come in second, spending an average of $129.29 per person, followed by 25-34 year olds, who are projected to part with $122.39 each.
Hey! Do you know What a Bottega-Venatta Is?
Either did I, since Bottega Veneta may not be as widely recognized as its more famous luxe-label sisters, but to wealthy consumers, the lesser-known line is the most prestigious luxury fashion brand.
In the 2006 Luxury Brand Status Index survey (LBSI) of Luxury Fashion Designers conducted by the New York-based Luxury Institute, Bottega edged out both Hermès and Armani to claim top rating.
The Luxury Institute surveyed a national sample of more than 500 households with a minimum of $200,000 in gross annual income and a minimum net worth of $750,000.
Bottega Venatta handbag. Only $3850.00
Wealthy customers who were surveyed rated 21 leading luxury fashion brands based on their perceptions of critical brand reputation metrics. Brands rated included: Armani, Bottega Veneta, Burberry, Calvin Klein, Chanel, Christian Dior, Coach, Dolce & Gabbana, Façonnable, Fendi, Ferragamo, Gucci, Hermès, Hugo Boss, Izod, Lacoste, Louis Vuitton, Marc Jacobs, Polo Ralph Lauren, Prada, Versace and Yves St. Laurent
Bottega Veneta's relatively low public awareness level of 21 percent, versus Hermès, which garnered 55 percent recognition, and Armani, which drew 74 percent, portends a strong future for the classic Italian brand, which is part of the Gucci Group portfolio.
"Those who know the brand rated it highest in quality, highest in uniqueness and exclusivity, as the brand most used by people who are admired and respected, and the brand most able to make its customers feel special," Milton Pedraza, CEO of the Luxury Institute, said in a release. "No surprise then, that it was rated the most worthy of a significant price premium."
The Luxury Institute's independent surveys are designed to measure brand performance from the perspective of the wealthy consumer. Publications include the monthly Wealth Report, the Luxury Brand Status Index surveys, the Luxury Best Practices surveys and the Luxury Consumer Experience Index surveys.
Be Careful Shopping On The Internet.
Red Herring has an important article today on Internet amd e-mail Spam.
Nothing gets users clicking on spam emails like a little porn, security experts said Friday, suggesting that users respond to emails that have erotic content in them even if they suspect it is spam.
The percentage of users who click through and buy products from spam is highest for pornographic sites, compared to emails touting drugs, easy cash, or mystery shopping jobs, said CipherTrust, an email security company.
The user response rate for spam email touting erotic sites is about 5 percent, compared to the response rate of about 0.02 percent for emails selling pharmacy drugs. Spam emails hawking Rolex watches, for instance, get even lower attention from recipients, averaging a response rate of just about 0.0075 percent, said CipherTrust.
“Porn sells, and that has been the case in the real world and on the Internet,” said Dmitri Alperovitch, research scientist at CipherTrust.
Meanwhile, U.K.-based antivirus and anti-spam company, Sophos, said its latest report on the top 12 spam relaying countries over the first quarter of 2006 shows the United States continues to lead in terms of the total spam sent.
More spam is sent from U.S. computers than any other nation but that’s changing. As a continent, North America is now close to being overtaken by Europe, with both following Asia in terms of spam relayed, the company said.
Some 23.1 percent of spam worldwide between January and March came from the U.S., followed by China (21.9 percent) and South Korea (9.8 percent). France ranked fourth (4.3 percent) followed by Poland, Spain, and Germany.
“Two years ago, the U.S. accounted for over half of all spam sent to the world. Now it is less than a quarter, evidence which confirms more Americans are waking up to the need to protect their home computers from malicious hackers,” said Graham Cluley, senior technology consultant for Sophos (see US Tops Spammers List).
Spam Tricks
Pornography may be the current flavor that appeals to users but many are beginning to respond to other kinds of messages.
“What works in spam is similar to what works in advertising,” said Joel Smith, chief technology officer at AppRiver, a Florida-based email security company. “Things like weight loss, work at home, get rich, those are beginning to find an audience.”
Though the clickthrough rate for spam seems small, security experts said it is enough to keep spammers in business. Spammers typically send out millions of messages every week at a very low cost, so just a few responses make a difference, said experts.
“Spam filters catch about 95 percent of the stuff that is sent,” said Mr. Smith. “From what gets through, we have seen clickthrough rates of about 1-2 messages per million.”
Still, phishing remains the best bet for online scammers, said experts. Phishing emails are just about 2 percent of all spam emails but they get the highest return rate because they target specific recipients, said experts. Phishing sites try to trick consumers into providing private identification information about themselves by masquerading as a legitimate site, such as a credit card company.
“We see an average of about 20 people submit their personal information to every phishing site,” said CipherTrust’s Mr. Alperovitch. “And this is considering the fact that most phishing sites stay around for just a couple of hours before they are taken down or disappear.”
More than $182 million was lost in online fraud in 2005, compared to $68 million in 2004, according to the Federal Bureau of Investigation’s Internet Crime Complaint Center.
Bottom Line: DO NOT OPEN e-mail you do not recognize.
Belgian Gov't Reduces Taxes On Diamond Companies.
At the end of 2005, a new fiscal law was adopted that will make Belgium far more attractive to all companies doing business there —which means not only diamond companies, but firms from all business sectors and industries.
The principle of the new program relies on what’s been referred to as a “notional interest rate.” As of accounting year 2006, all Belgium-based companies will have the opportunity to calculate a totally fictitious interest rate on their equity. This interest rate — which is currently between 3.442 and 3.942 percent — will be deductible from the taxable profit, a measure that is likely to reduce the taxable profit of businesses to verylow levels. The effective tax burden, especially for larger capitalized companies, could drop from the usual 28 or 34 percent corporate income tax rate to the negligible figure of 6 percent in the best cases.
The new tax law does not have any stringent conditions — no employment condition, no investment condition, applicable to all companies, no limitation on activity — and will restore the balance between Antwerp and other competing diamond centers.
Kaushik Mehta of Eurostar Diamond Traders, however, has a different opinion: “It’s very good as you pay less tax. The notional interest will certainly help ease business in Belgium, but it’s still no match for Dubai, at least as far as their zero tax is concerned. Antwerp has other assets, such as a huge market, to compete with other diamond centers.”
The notional interest tax plan will also assist with respect to DeBeers Diamond Trading Company (DTC) and the Banks. The diamond industryr is typically a sector that requires large working capital and relatively small profit margins, and a substantial number of companies have capital booked as current account. Currently, this cannot be taken into consideration for the notional interest deduction and is booked as a loan. From this year onward, registration fees on capital increases of 0.5 percent are abolished and there is virtually no cost involved anymore in increasing the statutory capital. Therefore, it is useful to incorporate the loans/current accounts into statutory capital. This, of course, can substantially increase the equity of the company, which also results in an improved solvability toward third parties — this is equity against balance sheet total. Banks are, indeed, pushing diamond companies to move toward an equity of 15 percent-plus because traditionally the equity of Belgian diamond companies is very low. Also, for sightholders, DeBeers takes into consideration the financial strength of a company, which is reflected in the equity and solvability ratio.
Consequently, the larger the capital, the higher the amount of the notional interest deduction. This allows companies with larger capital to pay lower taxes on their profit and as a result have higher net profits, which, again, they can capitalize. The following year, the equity has grown with the increased net profits of the previous year on which the notional interest deduction is applicable. So, this creates a rollerball effect in which equities grow quicker and quicker and are constantly leveraged with the notional interest deduction the following year.
It’s been understood that the measure would also benefit smaller-size companies, depending on their degree of capitalization, as the law applies to all corporate entities. Percentwise, it can create the same result, but, of course, the nominal amounts are smaller.
The first cycle of the system will be completed within the year. Tax reduction is positive in that it spurs production and eventual tax revenue. The effects on consumer prices remains to be determined.
Web Analytics Vendor warns a fifth of pay-per-click activity may be Fraudulent.
ClickTracks Analytics has introduced updated software for detecting click fraud, saying that an average of 20 percent of a company’s pay-per-click adverting budget can be traced to fraudulent activity.
The problem stems from individuals or companies trying to increase pay-per-click online ad traffic through illegitimate means. By driving up traffic on ads that show up next to search results, they would get more revenue from the advertiser.
In some cases, the fraud involves using software robots to do the extra clicking, or hiring people to click repeatedly on the ads.
The Santa Cruz, California-based company’s products, ClickTracks Professional and ClickTracks JDC, compare different statistics from the ads and highlight variances that show evidence of suspicious activity. The technology works with the Google, Yahoo, and MSN search engines.
The software highlights statistics such as the number of clicks that come from a certain country, the number of sessions with no referrer site for the click, and the number of different IP addresses.
‘An automated bot flies right underneath the wire.’ says Michael Stebbins, of Clicktracks.
Joe Tedd, operations manager at the New York City-based diamond e-tailer DiamondHarmony.com, has been testing the products on his site. “Since we began using it, which was at the start of the holiday shopping season for ’05, it helped us identify up to $10,000 in fraudulent clicks,” he said. “The tool paid off for us in the time we began beta testing.”
DiamondHarmony spends close to $30,000 per month on online advertising. Mr. Tedd said that without a click fraud tool, his company would not have noticed suspicious activity until much later this year.
At first, he had difficulty confronting the search engine where the suspicious activity originated. The company wouldn’t believe him until he produced detailed reports that prompted the search engine to acknowledge there was a technical glitch and give DiamondHarmony a refund.
While the technical glitch by itself accounted for a proportion of the extra clicks on his company’s ads, Mr. Tedd believes some fraudulent activity also occurred that exploited the technical glitch.
“We debugged something for them that they had never encountered before, and they realized the issue was something on their side,” he said.
Michael Stebbins, vice president of marketing at ClickTracks, said there are click farms run from India and China that drive up click traffic, and sophisticated software robots that can be difficult for many web advertisers to detect. “An automated bot flies right underneath the wire,” he said.
ClickTracks’ 7,000 customers include major companies like Coca-Cola, Intuit, NASA, Nokia, Nordstrom, Pfizer, and Volkswagen.
Pay Per Click (PPC) advertising is big revenue for Google, Yahoo, and MSN and getting more expensive all the time.
Indeed, BlueNile, a leading diamond e-tailer partly ascribed their lower 4th Quarter 2005 earnings results to significantly increased PPC advertising costs.
Buying Your Diamond Engagement Ring On The Internet: Why You Can't Rely On Just The "Numbers".
We have long advocated and blogged that buying a diamond on-line from an Internet vendor that does not actually have the diamond in-house can be dangerous to your psyche and pocketbook. The link is here: Buying Your Diamond On The Internet
This fact was once again driven home to us and one of our clients who requested information on two Pear shape diamonds listed on our Exceldiamonds.com website Exceldiamonds.com.
Both diamonds weighed .81 carats, were VS-1 Clarity, were graded by GIA, and had different Millimeter Measurements . One was a "D" color, the other a "G" color. How do you make a decision? Tough way to spend thosands of dollars, isn't it?
We called in both diamonds from the manufacturer and did these photographs for our client. We want you to see the dramatic visual differences between these two diamonds. Both diamonds are beautiful but uniquely different in shape and light refraction. The .81 D color has a crushed ice look with good scintillation, and is a classic "Tear-Drop" pear shape; whereas the .81 G color is much more dispersive and has what Bill Goldberg would refer to as a "sexy shape". Both diamonds are very appealing and will make for a beautiful diamond engagement ring.
There is no "right" or 'wrong" answer or decision on these two diamonds, it's entirely subjective. You won't get this information from a drop-shipper who never sees the diamonds he sells and doesn't have a clue. Might work if you're buying a cuisinart from Walmart or a book from Amazon but not diamonds which are visual.
Which Pear Shape would you buy?
Bluenile 1Q Profits Down 9%
On-line diamond retailer Bluenile reported first quarter profits down 9 percent on Sales that increased 15% for the period ending April 2, 2006. The number of orders rose 12 percent and the average order was about $1,482.
The cost of sales rose 15 percent to $40.33 million. Expenses related to sales and administration rose 26 percent to $7.7 million, and capital expenses nearly tripled to $608,000.
Blue Nile reported first quarter results after the bell. Shares closed down 27-cents to $33.65.
During an investor's conference call, Blue Nile CEO Mark Vadon said Blue Nile's prices were "more aggressive" in the quarter and the company had lowered diamond prices to sell more. He also cited the increasing competition and costs for keywords in Pay Per Click advertising on the major internet Search Engines; Google, Yahoo, and MSN.
Website traffic rose during the quarter and the company plans an aggressive conversion rate strategy in 2006 to drive sales. Conversion rate improvements are related to attracting more buyers per click.
Diamond Sales Increasing.
Consumer drive for diamonds hasn't waned in the past decade, with the Diamond Information Center (DIC) reporting 2005 as the 10th consecutive year of retail diamond jewelry's growth in the U.S.
Diamond jewelry sales rose in 2005 to $33.7 billion, up 7 percent from $31.5 billion in 2005. In addition to the growth of overall U.S. sales, which comprise more than 50 percent of worldwide sales, transactions grew by 3 percent and average ticket prices were up by 4 percent.
Canada Drops Jewelry Excise Tax!
The Canadian Government today abolished it's jewelry excise tax.
Canada's conservative majority in government dropped a number of excise taxes on May 2 to create "a more competitive business tax system," said Jim Flaherty, the country's finance minister.
Along with the tax changes, Canada's jewelry excise tax was eliminated. In June 2005, Parliament voted to abolish the jewelry excise tax over a period of 5 years.
"Jewelry is available at all price levels and is purchased by a wide range of Canadian households," the budget report read. "Repeal of the Excise Tax will recognize this and ensure that the Canadian jewelry industry is able to compete on a fair and equitable basis with other retail and manufacturing businesses in Canada. It will also serve to reduce the compliance burden on the jewelry industry, a particular benefit to small businesses.”
The Canadian Jewellers Association (CJA) briefed the industry on the news. Morris Robinson, chair for the group's government relations committee, said, “We are delighted that the conservative government has ended the inequity and confusion inherent in the Excise Tax in the content of minister Flaherty’s budget.
According to a statement by CJA, the "vote of confidence to our industry is the result of many group and individual efforts, specifically to the Prime Minister [Stephen Harper] for honoring his campaign promise to our sector."
Are you listening U.S. Congress? Get rid of these consumption taxes!!
Brother, Can You Spare 10 Million?
House of Taylor Jewelry, which suffered losses for its fiscal year 2005, has secured $10 million in financing from investors to buy inventory and to use for marketing and working capital.
House of Taylor Jewelry saw sales of $5.61 million and a net loss of $3.5 million for the year ended Dec. 31, 2005. It attributes the loss to numerous factors, including a restructuring, a focus on designing and sourcing new products; developing sales and marketing strategies; reducing inventory of discontinued product; and increased research, development and marketing, according to a May 1 2006, press release from the company.
In May 2005, the company underwent a restructuring after acquiring the licenses to market jewelry under several new brand names including Elizabeth and House of Taylor Jewelry (both designed by Hollywood legend Elizabeth Taylor) and Kathy Ireland for House of Taylor Jewelry (designed by retail mogul and former model Kathy Ireland).
The company launched the new merchandise during the Las Vegas market week in June. In connection with the restructuring, the company saw one-time expenses of $656,000 and non-cash amortization of about $590,000. This year, it will be back in Vegas with new merchandise.
Is there such a thing as a "Born Again Sucker?" Sure looks like it!
Diamond Jewelry Blowout Sale!!
In Celebration of Mother's Day!
Check it out here
Diamond And Pink Sapphire Earings.
.91 carat weight Diamonds and 1.40 carat weight Pink Sapphires in Platinum. Chris saw a smaller version at Tiffany's and asked us to replicate this design with bigger stones. Chris is getting married this Saturday.
Congratulations, Chris!!
Well, Don't You Know; Internet Diamond Retailer Diamond.com Goes Belly Up.
Diamond.com, one of the first and very heavily financed Internet Diamond and Jewelry websites today announced that they are officially out of business.
Diamond.com's parent company, Odimo Incorporated (Nasdaq: ODMO - News), an online retailer, today announced that Ice.com ("Ice"), an online retailer of diamonds and jewelry, has purchased from Odimo certain specified assets comprising Odimo's diamond and jewelry business, including all of Odimo's rights to the domain name www.diamond.com, and related trademarks, copyrights, product images and other intangibles in exchange for $7.5 million. Additionally, Ice purchased the Company's remaining diamond and jewelry inventory and corporate packaging for an additional $2.0 million.
Diamond.com's diamond database consisted of "Virtual Diamonds" (VD) which were not owned or housed by Diamond.com but were instead directly drop-shipped to the customer by the wholesaler-manufacturer. Little if any information regarding the diamond's Cut Quality, Light Performance, or Photos were provided. Consumers literally bought 'blind'. We've blogged on this topic several times, for example HERE: "Virtual Diamonds"
With the increasing growth of the Internet and the rapid dissemination of information, consumers are becoming more knowledgeable, savvy, and demanding of detailed information on the diamonds they are considering for purchase. The diamond websites that know their diamonds, have them in-house, and have the technology to showcase and display their attributes are garnering the confidence of consumers and making the sales.
It's interesting to note that Virtual Diamond Internet drop-ship retailer Bluenile(NASDAQ: NILE), currently the biggest diamond e-commerce website has reported lower profits over the past two quarters. First Quarter 2006 profits were down 9% even though they lowered their diamond prices.
Looks like the shakeout has begun. Good morning, Mr. Darwin.
E-Commerce Legislation for Internet Jewlers.
The National Retail Federation (NRF) is urging passage of a bill introduced to the U.S. House of Representatives that would ensure online retailers retain full access to customers on the Internet.
The bill would require "net neutrality," which would proscribe a tiered system of access whereby search engine results would be determined by retailers' willingness to pay a premium to have their Web sites appear on a user search.
"Online and multichannel retailers have spent the past decade revolutionizing the way Americans shop, by giving each and every consumer greater access to a wide variety of goods and services at highly competitive prices," NRF Senior Vice President for Government Relations Steve Pfister said in a letter to House Judiciary Committee Chairman James Sensenbrenner, R-Wisc., and Ranking Member John Conyers, D-Mich.
"Because of the importance of this medium to the retail industry, NRF hopes that the Internet will remain an open highway of commerce," Pfister continued. "Recent interest in a system of tiered Internet usage, as expressed by major telecommunications companies, threatens to eliminate network neutrality, forcing the Internet into a system more like cable TV, where retailers and other content providers would have to pay for the best access to consumers."
Last week, Sensenbrenner introduced H.R. 5417, the Internet Freedom and Nondiscrimination Act of 2006, which would amend the Clayton Act federal antitrust law to require that network providers interconnect with one another to operate their networks in a nondiscriminatory manner.
E-Commerce Sales Exploding!
According to a recent study of 174 retailers conducted by Shop.org/Forrester Research, total online transactions are expected to rise 20 percent over last year, to $211.4 billion. Excluding travel, online sales in 2006 are projected to reach $138 billion.
Total online retail sales are on track to zoom past the $200 billion mark this year, more than double the $100 billion volume reached just three years ago.
Total online retail sales last year rose 25 percent to $176.4 billion. Excluding travel, online sales rose 28 percent to $113.6 billion, representing 4.7 percent of total retail sales in 2005.
Apparel, accessories, and footwear should claim $13.8 billion of the total online spending this year, not far behind computer gear, which is expected to be the leading category at $16.8 billion. Sales of cosmetics and fragrances are expected to increase 30 percent, the strongest growth category.
The most successful online retailers are utilizing their Web sites to create multichannel environments.
Nearly 80 percent of retailers maintain pricing across channels, and 46 percent allow customers to buy and redeem gift cards online and in stores. Thirty-three percent allow customers to accrue loyalty program points across channels, and 26 percent offer in-store product information online.
DeBeers Sues Diamond Merchant Over It's Name.
DeBeers is suing and going to Court.
A federal court hearing is schedule in Manhattan on May 30, 2006, for use of the trademark name De Beers (and DeBeers) online. According to De Beers, diamond merchant Marvin Rosenblatt purchased some three-dozen variations of "debeers" as part of Internet domain names under his incorporated firm DeBeers Diamond Syndicate Inc.
De Beers sued Rosenblatt for violating the Lanham Act on June 1, 2004, for "unfair competition and trademark dilution violations under New York law," according to the court papers. De Beers claims it is the rightful owner of the brand name along with "luxury goods" partner LMVH Moet Hennessy Louis Vuitton. The partners are the sole owners of De Beers' trade identity in the retail diamond and luxury goods arena of the United States, De Beers states in court documents.
Rosenblatt incorporated DeBeers Diamond Syndicate in the state of Delaware September 10, 1981. In December 2001 he registered nearly three dozen domain names, and filed (as a trademark) in January 2002 the words: DeBeers Diamond Syndicate.
While the original court documents filed by De Beers show that it is in the business of selling both diamonds and luxury goods, the De Beers LV trademark application in the United States is not quite as clear and lists "luxury goods."
De Beers LV owns and operates two retail diamond stores in the United States, one at Fifth Avenue and 55th Street in Manhattan, and a second store at 401 North Rodeo Drive, in Beverly Hills, California.
Zales Searching for New CEO.
Zale Corp. has narrowed its search for a new chief executive to two leading candidates from outside the jewelry retailer, though a final decision likely won't be made for several weeks.
Mary "Betsy" Burton, a Zale board member who assumed the interim CEO job upon Mary Forte's dismissal in January, said Thursday that the search remains open though Zale has identified "a couple of excellent candidates."
Burton added that a Securities and Exchange Commission investigation of Zale's accounting announced last month hasn't deterred candidates in the search pool. Even so, an announcement isn't imminent.
"There is a concern that we're in the throes of finalizing holiday (strategies)," Burton said in an interview. "To put someone else in at such a critical juncture might actually be more disruptive."
Irving, Texas-based Zale, a retailer of diamonds and jewelry, collects most of its net in the Christmas quarter, its fiscal second. Zale ranks as the No. 2 specialty jewelry retailer in the United States by marketshare behind Sterling Jewelers Inc., the U.S. arm of London-based Signet Group PLC. In the United States, Sterling operates the Kay Jewelers and Jared the Galleria of Jewelry brands. Also in the U.S., Zale operates Zales Jewelers; Zales Outlet; Gordon's Jewelers; Bailey, Banks & Biddle; and Piercing Pagoda.
Forte, Zale's CEO since 2002, resigned in January after a strategy to shift flagship brand Zales Jewelers to a more fashionable, upscale clientele tarnished the retailer's holiday results. Following her out the door were Zales Jewelers President Paul Leonard in February and Chief Operating Officer Sue Gove in March. Zale issued the three nearly $13 million combined in severance pay
Higher Gas Prices Benefit Internet Retailers
"Consumers are making difficult choices to offset the rising cost of driving," BIGresearch reports. When asked if fluctuating gas prices have impacted their spending, 75.3 percent of nearly 7,500 respondents agreed. While that may come as no surprise, the survey results raise a major red flag for business and retail.
"It's not just people making less that $50,000 per year who are rethinking their household spending," said Joe Pilotta, vice president of research for BIGresearch. "People making more than $50,000 per year are also feeling the pinch of gasoline price hikes and are cutting back in many of the same ways."
With gasoline costing some drivers as much as $40-$50 extra per week from two years ago, (and average worker salaries unchanged according to the United States Bureau of Labor Statistics) the conclusion speak for itself, BIGresearch contends.
"With the continued impact of higher gas prices, shopping has become increasingly difficult," said Pilotta. "Consumers have to think more realistically about adding the cost of driving to their household budget than in the past -- and coming up with ways to help offset the blow."
Consumers queried for the survey reported buying more non-brand items, conducting comparative price-shopping before making a purchase, shopping for sales, and buying online.
Survey Highlighlights Importance of Diamond and Jewelry Branding
Diamond and diamond jewelry brands continue to see increased awareness among consumers, according to a survey of 2,571 members of the Jewelry Consumer Opinion Council (JCOC) conducted from May 31 to June 12.
A media release from JCOC stated the leader of the branding pack is the Zale Diamond. It remains the strongest diamond brand since the survey was last conducted in October 2004. It is followed closely by Hearts On Fire, Radiant and the Leo Diamond. While consumers say a brand name is still the least important factor in driving the diamond purchase, they acknowledge that brands are gaining importance.
Among the changes since the 2004 survey: Hearts On Fire has gained recognition in the past two years; consumers are naming more diamond brands, such as Lucida and the Princess Plus; more respondents are saying they own a branded diamond, while a smaller percentage are citing a lack of awareness for not owning one; a larger percentage of respondents say they own branded diamond jewelry such as Vera Wang, Scott Kay and Escada; and consumers say they are slightly more willing to pay higher prices for branded diamond jewelry versus two years ago.
"It's extremely difficult to establish specific brand awareness with consumers," said Elizabeth Chatelain, president of MVI Marketing Ltd., founder of JCOC, in the release. "Although consumers are more willing to pay premium prices for branded products, making a jewelry line 'stand out' is not getting any easier. With the saturation of brands in the market, a name and logo is not enough to catch consumer attention. Each brand must develop a niche, a unique selling proposition, or a product attribute demanded by consumers."
While consumers were willing to pay more for a brand, they were also deterred from purchasing branded designer jewelry because of high prices, Chatelain said.
"The key to successful product branding is to design and deliver a unique product the consumer needs and prefers to other products available," she said. "Manufacturers and retailers can help consumers come to understand what exactly branded diamonds and diamond jewelry are, and that the consumer has increased flexibility in choosing."
Gals, Looking To Marry A Sugar Daddy Millionaire? Go To Ireland.
The Irish Times reports today that Ireland is now the second wealthiest nation in the world with more than 30,000 millionaires living here, according to new research published by Bank of Ireland Private Banking.
The average personal wealth per head of population in the Republic is nearly euro 150,000, the "Wealth of the Nation" report found. This is higher than average wealth of euro 137,000 in the United Kingdom and euro 129,000 in the United States.
Only Japan has higher net wealth per head of population than the Republic at euro 206,000.
Net wealth in the Irish economy has grown by 350 percent over the past decade - three times faster than the rate of growth in Britain. The growth rate takes into account the increasing levels of household debt in the economy.
Out of the estimated 30,000 millionaires, some 300 individuals are thought to have a net worth of more than euro 30 million. A further 2,700 people are reckoned to have a net worth of euro 5 million to 30 million. Bank of Ireland's definition of millionaire excludes people's main residences. If these were included, the number of millionaires in the country could be as high as 100,000.
Irish wealth is "disproportionately" skewed toward property, with 71 percent of total wealth invested in the asset last year. Some 16 percent of Irish wealth is invested in equities, while 10 percent is held in cash and 3 percent is invested in bonds.
Bank of Ireland forecasts that, by 2015, property will be less dominant. It predicts that the breakdown of investment will shift to 61 percent in property, 22 percent in equities, 12 percent in cash and 5 percent in bonds.
The move away from property will be prompted by "more realistic" property prices, while an ageing population will show more interest in investment and pension funds.
Most of the Republic's wealth is "new money" created by people's willingness to borrow to invest further, according to Mark Cunningham, Bank of Ireland Private Banking's managing director.
"It has been entrepreneurial and more risk-orientated than many other developed countries where inheritance features more prominently," he said.
Personal disposable income in the Republic has doubled over the past 10 years, and is forecast to double again over the next decade. The annual level of personal savings stood at euro 10 billion at the end of 2005 and this is forecast to increase to euro 13.5 billion by 2010 and to euro 24 billion by 2015.
Debt as a percentage of disposable income has increased from 89 percent to 140 percent in the past five years. But O'Sullivan said that neither the absolute level of borrowing nor borrowing levels relative to overall wealth were ahead of international norms.
Jewelers Keeping An Eye on Bling-Bling Sales.
Consumers shrugged off higher gasoline prices in July and grew a bit more optimistic about the economy, a private research group said on July 25.
The optimism may be short-lived, however, as shoppers face a slew of concerns, including rising interest rates, moderating home prices, more expensive fuel costs and war in the Middle East. Indeed, home sales, which have been a source of confidence for consumers, fell again in June.
The National Association of Realtors reported on July 25 that sales of previously owned homes and condominiums dropped 1.3 percent in June to a seasonally adjusted annual rate of 6.62 million units. It was the eighth time in the past 10 months that sales slipped, while home prices edged up at the slowest pace in more than a decade.
The New York-based Conference Board said that its confidence index rose to a better-than-expected reading of 106.5 from a revised 105.4 in June. Analysts had expected the index to fall slightly to 104.
Stocks vacillated July 25 as mixed earnings news overshadowed an unexpected jump in consumer confidence and the mild housing data. In late morning trading, the Dow Jones industrial average dropped 29.94, or 0.27 percent, to 11,021.11, after briefly climbing into positive territory. Investors had a brief bout of optimism that the economy was slowing gradually, rather than slamming on the brakes.
Jewelers are cautiously optimistic about this years Fall and Winter sales which make up the bulk of the entire years revenues.
Interest rates, Oil prices, and the political situtaion in the Middle East and Asia are on the radar screen.
Internet Buying Continues To Surge
Consumers spent $80.8 billion online in the first half of the year, 20.1 percent more than in the first half of 2005, according to comScore Networks.
Excluding auctions and large corporate purchases, retail spending alone totaled $46.1 billion, an increase of 24.6 percent, while travel spending reached $34.7 billion, a 14.7 percent gain.
Top retail categories for growth included computer software (up 39 percent), sports and fitness (up 38 percent), home and garden (up 36 percent) and toys and hobbies (up 33 percent), according to comScore Networks.
"Despite the sluggishness of retail growth in general, online consumer spending remains strong," Gian Fulgoni, comScore chairman and co-founder said in a press release Wednesday.
The consulting firm expects total online spending for 2006 to arrive at about $170 billion. Of that, comScore expects non-travel spending will reach a record $102 billion, with about $24 billlion spent on non-travel purchases online during the holiday season.
Odimo.com to be de-listed.
Odimo Incorporated, an online retailer that offers brand name watches and luxury goods through two websites, received a letter from The Nasdaq Stock Market ("Nasdaq") on August 3, 2006, informing the company that its securities will be delisted from quotation on The Nasdaq Global Market effective at the opening of business on August 14, 2006.
On May 2, 2006, Nasdaq informed Odimo that its common stock had not maintained a minimum value of publicly held shares of $5 million over the previous 30 consecutive trading days, and as a result, did not comply with Marketplace Rule 4450(a)(2).
According to Marketplace Rule 4450(e)(1), the company was granted 90 calendar days, or until July 31, 2006, to regain compliance with the rule. Odimo did not regain compliance and as a result, Nasdaq determined to delist the company’s securities from quotation on the Nasdaq Global Market.
Odimo.com recently sold it's Diamond.com name. rights, and website to Ice.com for 9.5 million dollars after having lost considerale amounts of money trying to compete in the ulta-competitive Internet diamond marketplace.
We blogged about their diamond troubles here:
Consumer Confidence: Where Is It?
The Associated Press reports that Consumer confidence slid to a three-month low as people fretted about the direction of the economy and their own balance sheets in the months ahead.
The RBC CASH Index, based upon results from the international polling firm Ipsos, showed cash confidence ebbed to 74.8 in early August. That marked a sharp drop from July's showing of 80.1. It was the second month in a row that confidence dropped, and it was the lowest reading since May.
Economists blamed the deterioration in confidence mostly on galloping energy prices and a cooling in the once-hot housing market.
With housing prices not going up as much as they had been, people aren't feeling as wealthy. That --along with the strain of expensive energy bills-- have forced consumers to tighten their belts, an important factor in the slowing of overall economic activity.
What effect this will have on the Diamond and Jewelry Trade upcoming critically important Fall Shopping season remains to be seen.
Word of Mouth Referrals Comes to The Internet.
JupiterResearch reports that 60 percent of online shoppers give positive feedback about a shopping experience and retailers can therefore improve sales by including user-generated reviews and rankings on their Web site.
The number of online buyers who cite customer ratings and reviews as the most useful shopping site feature has more than doubled from 2005 to 2006. Buyers who write consumer reviews make up only 20 percent of online shoppers by account for 32 percent of all Internet sales.
Diamond Powerhouse Fabrikant Still Breathing.
Months long reports and rumors of the collapse of 100-year old M Fabrikant & Son, a leader in the diamond and jewelry trade appear to have been greatly exaggerated.
Fabrikant announced an agreement with its domestic lenders on August 7th.
Fears of Fabrikant's demise were triggered by the filing of two lawsuits against them by Creditors. Blue Star, an Indian based manufacturer filed a lawsuit against Fabrikant seeking 5.6 million in unpaid invoices, while K P Sanghvi filed a similar lawsuit for 1.9 million.
Fabrikant, a DeBeers Diamond Rough SiteHolder, is now prompted to start worldwide review of its operations.
Stay tuned.
Internet Diamond and Jewelry Sales Booming!
Online diamond, jewelry, and watch sales soared in the second quarter of 2006.
Led by Amazon.com, BlueNile, and eBay, retail jewelers reported record sales and profits for the second quarter.
Amazon reported that its second quarter jewelry and watch sales doubled compared to last year, while sales of diamonds and diamond engagement rings increased by 30%.
Blue Nile reported a 29% sales increase for its diamonds and diamond engagement rings for the second quarter, while eBay reported that its watch and jewelry sales increased by 8% to 1.7 billion.
Overall, consumers spent 80.8 billion online in the first half of 2006, a 20% increase over the first half of 2005, according to a survey by comScore Networks.
The survey also indicates that Diamond and Jewelry Websites that are easy to navigate and offer a wide selection of quality merchandise at attractive prices are garnering the traffic and making the sales.
Zales Looking To Rebound.
Back in January 2006, Zales, a heavyweight merchant in the retail diamond and jewelry scene was reeling from its ill-conceived shift from its core customers towards a more upscale market.
Like Coca-Cola back in the '80's with its "New Coke" formula, Zales painfully discovered with its significant loss of market share that you can't abandon a classic or a business formula that had worked successfully for years.
Changing CEO's seems to have awakened Zales and made them smell the coffee.
Under new CEO Betsy Burton, Zales is getting back to what their clientele wants and has always wanted: diamond fashion rings, wedding and engagement rings, wedding bands, and bridal accessories and away from the avant garde upscale silver and gold designs.
This Holiday Shopping season which ranges from the beginning of October through Christmas will be a good indicator if Betsy Burton and Zales are back on the right track.
GIA Symposium: Message for Retail Jewelers.
The first full day of the 2006 International Symposium got off to an early start with a breakfast speech by behavioral market research expert Paco Underhill. Underhill, the founder, CEO, and president of Envirosell Inc., an international behavioral market research and consulting company, spoke about the consumer of the 21st century, and had a stark message for jewelry retailers – the need for change.
During the course of his well attended speech, Underhill was especially tough on jewelry retailers who complain that the Internet is destroying their business. “The net is failing you because you haven’t figured out a way to use it,” he said in no uncertain terms. “If you don’t use the Internet in 2006, goodbye, because you won’t be here in 2010.”
Underhill advised the audience – which included many retailers – that they must figure out how to fit into their customers’ lives. As an example, he cited the Damas chain in the Middle East, which offers party rooms for weddings and birthday parties in which groups of women can try on jewelry in a relaxed and accessible atmosphere. “Customers have changed,” he said, “and now it is the jewelry store that needs to be refreshed.”
Wedding Insurance: Do You Really Need It?
Having an insurance to cover your home or car is a no-brainer and in almost all States mandatory.
Specialty insurance is a growing segment of the insurance market, says Jeanne Salvatore, spokeswoman for the Insurance Information Institute, a New York-based industry group.
"There are only so many cars and homes out there to insure," Salvatore says. And insurance products have to keep up with a changing world. For example:
How about insurance to cover your costs if your wedding gets canceled?
So what happens if you spend a boatload of money on your big day and you have to postpone because of something like a flood or a hurricane or because the bride or groom or one of their parents is hospitalized?
Maybe you lose your deposits. Maybe you have to reschedule at great expense. Not to worry: Wedding insurance can help.
Such policies will cover expenses if you have to reschedule your wedding for a "covered reason," such as Mother Nature, illness or military deployment.
If the bride or groom simply gets cold feet, though, forget it.
The policies cover expenses like forfeited deposits and travel expenses. If a rowdy dancer or drunken guest runs into your gift table at the reception and causes it to collapse and break some of your gifts, the damage is covered. If your wedding photos don't turn out, the insurance will pay to reconvene your wedding party to take replacement photos. If the best man loses the wedding rings, it's covered. And if a wedding postponement or cancellation causes the bride or groom to need professional counseling, the insurance will pay for the sessions.
Mother-In-Law clause is NOT included in the Policy.
One policy, WedSafe insurance through Robertson Taylor Insurance Brokers Ltd. of London, costs $185 for about $15,000 coverage, and $405 for about $75,000 coverage.
Good Idea!
Buying Your Diamond Engagement Ring On The Internet: Future Trends.
E-commerce is booming, with all sorts of products being bought and sold, especially Diamonds, Diamond Engagement Rings, and Wedding Rings. We recently made note of this trend here:
Diamond E-Commerce
Asia is the next E-Commerce frontier. No doubt there are still many consumers out there that are skeptical if this trend will continue and/or are just flat-out more comfortable shopping for their Jewelry at their neighborhood Jewelers. Well, for you skeptics and non-believers, a peek into the future might just change your mind.
At the Red Herring Asia 2006 conference Wednesday in Hong Kong, Safa Rashtchy decided to travel to 2026—10 years further than other analysts dare to look.
A managing director of Piper Jaffray who analyzes the Internet, Mr. Rashtchy said more than half the world’s Internet users would be in Asia by 2026: 1.3 billion out of a total of 2.5 billion.
Despite the large number, the penetration rate would be only 30 percent, leaving huge scope for growth.
Companies in this space would do well to address the Asian markets. In China, for instance, 39 percent of Internet users are in the age group of 18 to 24. Another 25 percent are between 31 and 50 years old, while 18 percent are in the 25 to 30 age group.
Shantanu Bhagwat, business development partner for Asia at Amadeus Capital Partners, said India’s online community is growing, though not as fast as its population of mobile phone users.
Indian cell phone users download ringtones worth about $100 million a year—and these downloads are not necessarily from high-end users.
Mr. Bhagwat expects online and mobile commerce in India to increase substantially in the next few years.
“About 67 percent of India’s GDP is made up of consumer spending, second only to the U.S., which is over 70 percent,” he said. “I expect a big chunk of spending will move to online platforms—on the Internet or on mobile phones.”
China’s homegrown Internet properties compete with well-established ones from the U.S., and consolidation is starting to happen.
Local companies in India still have to get numbers, but there’s a huge revival of interest in the online space. Venture capitalists, both local and those from Sand Hill Road, are investing in online companies, hoping for large monetization as online communities grow.
MakeMyTrip.com, an eVentures-funded online airline and hotel booking company that began catering to local travel in India in September 2005, is getting huge traffic these days.
CEO Deep Kalra believes India’s web commerce of about $500 million is just the tip of the iceberg. “There are endless opportunities,” he said.
U.K. E Commerce Booming.
The Interactive Media in Retail Group, which tracks online spending, concludes that Internet sales in the United Kingdom are booming in 2006 -- 10 times the rate of brick-and-mortar sales increases so far. Online July sales rose 35 percent from 2005 to $4.44 billion.
Online retail accounts for 10 percent of all retail sales in Great Britain and could increase to 25 percent of all spending by year 2010 if current growth rates were maintained. As a comparison, Forrester Research estimates online retail sales to reach 12-15 percent of total retail sales by year 2010 in the United States.
Amazon.co.uk is the most popular retail website in the United Kingdom at present time.
According to credit information group Experian, those consumers most likely to shop online are short on time and are top earning professionals who value the convenience of online shopping.
Jewelers Targeting Hispanic Market
The U.S. Hispanic population is exploding and making up an increasing proportion of the U.S. economy. 39 million Spanish speakers represent 12.1% of the U.S. fine jewelery purchases and spent 1.5 billion, up 10% from 2004.
Jewelers are sitting up, taking notice, and addressing this group through the use of visual advertising, pitching diamond engagement rings, wedding rings, and wedding bands.
Research firm Scarborough Research has found that Hispanics respond to visual
merchandising even better than the general population.
Latino culture by nature is more emotional and colorful and promo material such as fliers, banners signs, and store policies, is geared in this way to the audience.
U.S. Census Bureau data shows that Hispanics marry at a younger age than non-hispanics. 20.8% of hispanic men and 43.8% of Hispanic women marry between the ages of 15 and 24, compared to 16.9% of the white men and 31.8% of white women.
Would You Buy A Diamond Engagement Worn By A Celebrity?
Good Question. Would you be influenced?
While luxury brands are eager to get celebrities to show off their goods, the impact may be negligible, according to a new study. In fact, the survey found celebrity endorsements are twice as likely to backfire as they are to produce immediate sales results among wealthy consumers.
The Wealth Report, compiled by the Luxury Institute, finds only one percent of wealthy consumers (median income of $250,000 and net worth of $1.5 million) will buy a luxury product based on an endorsement from a celebrity. Only five percent say endorsements would increase their consideration of such purchases.
Of those surveyed, 13 percent would definitely not consider a celebrity-endorsed luxury product, and 63 percent said celebrity endorsements do not affect their decision-making at all.
But the report finds celebrity endorsements do raise awareness of luxury products and services. Of those surveyed, 18 percent said celebrity endorsements help them become aware of luxury offerings.
In terms of products, celebrities have the greatest power in promoting fashion designers, with 30 percent of those surveyed admitting celebrity influence in this category.
Holiday Gift Spending To Increase, Says Report.
Shoppers buying gifts this holiday season will spend an average of more than $1,000 each, according to a new study from Unity Marketing.
This represents an 8 percent increase over last year's average holiday gift budget of $928.
So far this year, consumers have spent an average of $1,034 on gifts, 20 percent more than last year, according to Unity Marketing's quarterly "Gift Tracker" survey, which monitors gift givers' purchases.
If consumers continue buying gifts at this rate, average gift-spending could exceed $2,250 for the entire year, a 12 percent increase over last year. A quarter of consumers polled have already spent $169 on Christmas gifts, according to the survey.
Unity Marketing expects top gift categories to include gift certificates; gourmet gifts like wine, spirits and chocolate; and "little luxuries" like soaps, candles and home fragrances.
The Gift Tracker survey takes quarterly polls of 800 gift-buying consumers, tracking what gifts they have purchased, why they purchased the gifts and where they bought them.
Vegas To Get New Jewelry Center.
The City of Las Vegas and real estate developer Probity International Corporation unveiled plans for one of the largest jewelry projects in the world on October 26, 2006.
Las Vegas Mayor Oscar B. Goodman welcomed guests and Probity's Robert Zarnegin and Bill Boyajian to celebrate this future one-million square foot mixed-use World Jewelry Center.
The World Jewelry Center is expected to host both corporate offices and trading offices of several hundred domestic and international gem and jewelry companies. The center will also have free-standing retail jewelry stores. The complex is planned to open for business between late 2009 and mid-year 2010.world jewelry center
Altoon & Porter Architects have designed the cornerstone of The World Jewelry Center, which will be an iconic, state-of-the-art office tower (one of the tallest office buildings in Nevada.)
Artists rendition of the new Las Vegas Jewelry Center
Tenants will own their own subdivided space in the tower and the structure will include meeting and exhibition facilities, international restaurants, a private club and a fitness center.
The top floors of the tower will be dedicated to luxury residential condominiums with panoramic views of the Las Vegas sprawling, desert landscape. An adjacent three-story retail jewelry center will offer a world-class gem and jewelry museum and exhibition space for the public.
"We're very excited about this global project coming to our city," said Mayor Goodman. "The World Jewelry Center will revolutionize the jewelry industry as well as change the way people and businesses view Las Vegas.
"The entire concept of the World Jewelry Center is very progressive and will fit in well with all the other innovative, international business projects coming to our city. The tower itself will change the face of the Las Vegas skyline and become a key landmark for the city."
The Center will be built with every amenity and service in mind to make it the world's premier fully integrated, service-oriented business hub catering to international and domestic retailers, manufacturers, dealers, and wholesalers in the gem, jewelry, and pearl industries.
Other features include state-of-the-art security; secure shipping and receiving; gem grading labs and educational facilities; trade associations; and plans for a dedicated Foreign Trade Zone.
The World Jewelry Center will be located in downtown Las Vegas (not on the Strip) within the prominent master-planned community of Union Park.
On-line Sales To Hit 100B in 2006.
Online sales tracker comScore Networks reported that third-quarter retail e-commerce sales rose 23 percent to $23.1 billion in the United States. All consumer online spending (which includes travel) rose 16 percent to $43.1 billion for the quarter comScore estimates.
For the quarter, which ended September 30, 2006, comScore noted that some retail categories performed exceptionally well including apparel and accessories (up 32 percent,) and sports and fitness (up 29 percent) and consumer electronics (up 42 percent.)
From January through September, the total online consumer spending on non-travel retail rose 24 percent to $69.1 billion. ComScore is predicting full year 2006 online (non-travel retail) sales to break the $100 billion mark by December 31.
“Online consumer spending at – and particularly non-travel spending – remains strong,” said Gian Fulgoni, chairman of comScore Networks. “With year-over-year growth rates in the United States online non-travel spending at about 23 percent in the third quarter, the web continues flexing its muscle as one of the important drivers of retail sales growth.”
Blue Monday At Blue Nile.
Online diamond retailer Blue Nile reported that Profits fell 28 percent to $1.8 million and sales rose 27 percent to $53.2 million during its third quarter, which ended October 1, 2006.
Blue Nile attributed the drop in profits to it's competitive price discounting and increased cost of the precious metals, Gold and Platinum for it's Jewelry and Diamond Engagement Rings.
Piper Jaffrey has downgraded the stock to 'Underperform'.
Getting married/ Need a Priest, FAST! LOOK HERE!
You and your gal decide this minute to get married? Need a Priest real fast?
No problem, no sweat. Rent-A-Priest is here!
Diamonds For Tech Geeks.
That's right. Tech Geeks are peoples too and deserve to enjoy the finer things in life.
Cartoon Barry; The Ultimo Top-Notch Tech Geek.
Despair not you Techies for the corporate world has harkened to your angst and come to your aid.
Grab your wallets, your salvation HAS COMETH: Diamonds For Tech Geeks
Gift Spending To Rise This Holiday Season.
In its annual consumer spending survey for Christmas gift-giving season the International Council of Shopping Centers (ICSC) expects the average household spend to increase 9 percent to $676.
Seventeen percent of consumers suggested they would spend much more than they spent in 2005, about 56 percent said they would spend the same on gifts in 2006 as they did one year ago, and 27 percent said they would spend less for Christmas 2006.
Expected holiday gift purchases for 2006, according to ICSC's survey, found that men plan to spend about $717 and women intend to spend about $637.
43 shopping days to Christmas.
How Do I Buy A Diamond Over The Internet?
Is a good question many consumers are asking.
Excellent discussion ongoing here: Click, Click. There's My Diamond!
Imelda Marcos Is BACK!
With a vengeance, my friends.
Former first lady of the Philippines Imelda Marcos—known for spending millions on shoes, clothing and real estate while her countrymen lived in poverty—has launched a fashion jewelry collection.
Marcos, 77, created the Imelda Collection this month after learning of the "hopelessness and helplessness of Filipinos everywhere," according to the collection's Web site.
Marcos used components of her personal collection of costume jewelry from around the world and Swarovski crystals to create the jewelry, which includes bib necklaces, brooches and bracelets.
"You don't have to be rich to be beautiful," Marcos says in a statement on the Web site. "Sometimes I have been rich. Sometimes I haven't. But there is still beauty out there. It may cost you the earth, it may be quite cheap, but in nature it might even be free."
Marcos created the jewels at the urging of her son, Martin "Borgy" Manotoc.
The Web site does not give further information about the jewelry's distribution or price points.
The shoes, Imelda, your 3000 pair of shoes!! Give us the shoes!
Buying Your Diamond Engagement Ring: Make Sure You Don't Become the Basted Turkey!
For many of us procrastinating guys, Today, Thanksgiving, marks the very last day of procrastinating from getting her that Diamond Engagement Ring or other Diamond Gift before Christmas hits next month.
So enjoy the Turkey today, the Beer! and the Triple-Header NFL line-up of games because starting tomorrow no matter how bloated, sick, and out of it we feel, we gotta put the pedal to da metal and get this gig done, PRONTO!
For the great majority of us, we'll be shopping for the Diamond Engagement Ring on the Internet.
It's convenient, fast, and demands very little physical exertion.
Be careful and check out the Vendors. Make sure that their listed diamonds are either in-house or can be shipped in to them by the supplier/manufacturer so that they can physically examine them for you, supply you with extra data, info, and photos, and to insure that there are no problems with the diamond.
Most Diamond Internet Vendors today carry what is called Virtual Diamond (VD) lists of diamonds that are supplied to them by manufacturer/wholesalers that are looking for a Retail window of opportunity. These diamonds are advertised with minimal information about the stone and if ordered are directly drop-shipped to you by the Manufacturer and is never "seen" by the Vendor you ordered it from. The information provided by a lab grading report is a useful start but tells you nothing about the face-up visual beauty of the diamond.
We recently blogged about this disturbing trend here:
and posted an informative thread to Diamondtalk.com on why it is dangerous to totally rely on "numbers" to buy a diamond. Playing The Diamond "Numbers" Game Doesn't Work
Bottom Line is this: get as much information as you can about the diamond and Vendor before you put your hard-earned money down on the Table.
Good Luck, Guys!
Cyber Monday Is HERE!!
Shares of Internet retailers dipped along with the overall market on "Black Friday" as the dollar weakened and investors remained concerned about consumer spending.
Black Friday, or the day after Thanksgiving, is usually the second-busiest day for shopping in person. The following Monday, known as "Cyber Monday," is generally a busy day for Internet retailers.
ComScore Networks, which tracks Internet spending, expects online sales of almost $600 million on Monday, which would be higher than any single day during the 2005 holiday season. Online retailers raked in $484 million on Cyber Monday last year.
ComScore estimated sales for the first 19 days of November rose 23 percent this year. This suggests online holiday spending is "strong coming out of the gate," ComScore Networks Chairman Gian Fulgoni said.
However, a MasterCard Worldwide study released Monday showed "Cyber Monday" is something of a myth -- and doesn't rank in the top five days for Internet shopping. Based on information from billions of credit card transactions over the past several years, MasterCard said online shopping actually peaks a week after Cyber Monday. In 2005, Cyber Monday was the ninth-busiest online shopping day of the year.
In midday trading Friday, Amazon.com Inc. and Ebay Inc. each fell about 1 percent, while RedEnvelope Inc., a San Francisco-based Internet retailer of upscale gifts, fell about 3 percent. However, the downward movement wasn't specific to Internet retailers -- the broader market was off slightly in Friday's shortened trading session as the dollar declined and traders bet on lower interest rates.
Get your Credit Cards ready, Get Set, Go................................
Nintendo Wii and Buying Your Diamond Engagement Ring: There is a Connection!
Nintendo Wii
Exceldiamonds Tiffany Classic Replica
No, I didn't toke on some bad weed or have too much tryptophan cross my blood-brain barrier by overdoing the Thanksgiving Turkey.
Nintendo's launch of the Wii over the Thanksgiving Holiday got me to thinking.
No, my friends, I actually see a connection here and it's this.
The Wii is cool,dude, because it allows the Player to actually physically interact with the objects on the screen to the point where you are "there"! You're the Tennis Player, the Boxer, the Baseball Player! How cool is that?
Now we sell beautiful diamonds, engagement rings, and jewelry on our Exceldiamonds.com website. We provide tons of data, information, and photographs on all of our products.
BUT!
You still can't reach out and touch the dang things!
So, Nintendo, SONY, somebody within the sound of my voice, figure out a way for a retractable arm to come out of our Computer screen to and through to the Customer's screen bringing diamonds and settings for their viewing pleasure.
You see it, you touch it, you like it, you buy it. Voila!
Shop within the comfort of your Home or Office! No Traffic or Parking hassles, no getting your tired tootsies stepped on, no need to navigate nattering pushy jewelry store salespeople!
Ahh Mechayah!! (That's pleasure for you people out in the Mid-West).
Farfetched, you say? Meshuggah, you think I am?
Nuu, so think about it already...makes ah lot of sense.
While you're thinking, you'll please excuse me for a bit...got to go answer this e-mail from Rod Serling.
E-Commerce: Booming and Gaining Consumer Confidence.
More Americans shopped online this year, and spent more money per month on the Web, than in the past six years, according to a survey released today from the University of Southern California.
The USC Annenberg study has been conducted most years since 2000. In that first year, 45.1 percent of adult Internet users purchased something online, compared with 51.1 percent in the 2006 survey. And this year, Americans on average spent $118.57 per month, compared with $71.30 in 2001.
However, the phone survey of 2,269 U.S. households also showed the number of times the average shopper bought something online declined this year to 30.1 times, from a four-year high of 34.6 times in 2005.
Web and brick-and-mortar retailers can benefit from some degree of cross-pollination. The majority of survey respondents said they sometimes browse in a physical store, then buy online, and vice versa. Clothing and books topped the list of most popular online purchases this year.
The survey also showed Web surfers are less worried about giving out their credit card information and other privacy issues than ever before. Only 4 percent of online shoppers said they waited to make their first purchase because of concerns about giving out credit card information over the Web, compared with 32 percent who cited that concern in 2002. And the number of online shoppers "very or extremely concerned" about privacy when shopping online has declined to 46.5 percent from 65.8 percent in 2001.
The survey was conducted in both English and Spanish from February through April, with a margin of error of plus or minus 3 percentage points.
Wanna Look Like a Hollywood Star?
Shoppers have a new online tool to visually search for the diamond jewelry and accessories the stars are wearing. Like.com, is the first visual search engine for jewelry, handbags, shoes, and watches. Simply click on the photo of a celebrity to find the necklace she is wearing at a variety of on-line jewelry stores!
Now how cool is that??
Wanna see how it works?
Here, try it.
Do you wish you had a pair of boots like the one
caught by photogs on Stacy Keibler at this recent event?
No problem! Simply click on her boots and see what you come up with!
Stacy Keibler at a recent event
On-line Spending Outpaces B&M Stores.
comScore Networks measured a 25 percent increase in online retail spending for November 1 through December 8, 2006, to $15.58 billion in the United States.
“Online consumer spending growth continues to beat expectations, increasing 25 percent versus last year,” said Gian Fulgoni, chairman of comScore Networks.
“The single-biggest online consumer spending day last year was Monday, December 12 with $556 million spent, but this year we’ve already seen 7 days eclipse $600 million in spending. In fact, each of the five days in the most recent work week (Monday, December 4 – Friday, December 8) exceeded $610 million. We expect that the heaviest day of this holiday season will occur during the week of December 11, with sales that should approach $700 million.”
Online shopping in the United Kingdom, France, and Germany continues strong, comScore reported the week ending December 3 was the most active cyber shopping week to date in both the United Kingdom and Germany, up 69 and 72 percent respectively from pre-holidays.
Foot traffic to major shopping centers has been light to moderate, certainly less than one year ago. However despite a drop in traffic those shoppers hitting malls and stores were considered to be serious about buying goods for Christmas gifts. Online sales and website traffic continue to be very strong.
BlueNile Added to S&P 600 Small Cap Index.
In a note to clients, Caris & Company analyst Tim Boyd discussed impact of adding online retailer Blue Nile to the S&P 600 Small Cap Index.
Blue Nile (NILE) will replace Lone Star Steakhouse on the index, however the date has not been set. "We note that while NILE is already a member of the Russell 2000, the S&P 600 has more stringent requirements for inclusion. In our view, this highlights NILE’s long-term financial viability," Boyd wrote.
The S&P 600 has a market cap of about $550 billion, and based upon Blue Nile's $550 million market cap, the online diamond retailer will receive an index weight of about 0.1 percent. "While it is difficult to estimate what kind of impact this will have on the shares, we note that Google shares rose 14 percent between the announcement of its inclusion in the S&P 500 [March 23, 2006] and the replacement date [March 31st.] On the one hand, NILE shares may not enjoy as much of a boost since the S&P 600 is not as widely replicated as the S&P 500; on the other hand, NILE could get an incremental pop because of the large short base [28 percent of the float, by our last count,]" Boyd concluded.
Boyd estimates a target price of $40 per share for Blue Nile -- a target price mentioned by several analysts for more than one year. Blue Nile rose above $40 per share briefly around Christmas 2005, but held within a range of $31-$36 per share for most of 2006. At opening bell on December 15, Blue Nile was at $35.53.
Potential risks, Boyd wrote, include decelerating revenue growth; minimal international presence; a challenging online marketing environment; and rising diamond and precious metal costs.
This indeed bears close monitoring as company insiders are selling their shares at a brisk pace.
ExcelDiamonds Launches New Diamond & Jewelry Search Tool
www.ExcelDiamonds.com, home of the SuperbCert Signature Hearts & Arrows Diamonds, announces today the launch of a new website tool which will allow customers to store and save past diamond & jewelry product searches for further review.
We anticipate this feature will be of invaluable assistance to our savvy customers, who take the time to research and compare many diamonds from our extensive loose diamond database before making their decision.
Check out this new feature here.
Internet Sales Are Surging..Up ..Up..And Away!
I was really happy to read this news report out today indicating a recent record day of Internet sales to the tune of a whopping $670 million dollars!!.
It is really noteworthy that consumer confidence for online shopping is increasing by leaps and bounds!
Who knows......maybe one day Brick and Mortar jewelry store staples like Zales Jewelers, Kay's Jewlers, & Helzberg Jewlers will only exist on the Internet...
.....highly unlikely since they are selling a far different product.
A Heartfelt Testimonial For Excel Diamonds
It is always very gratifying when we receive a heartfelt diamond testimonial from one of our happy customers. Here is one that we received today.
--------------------------------------------------------------------------------
Barry and Judah,
I just wanted to thank you both so much for your help :)
After a long and frustrating day with UPS I finally received the package.
Must have been a new driver or just the time of year but
that package went all over the place and UPS didn't have a clue where it was.
I was told it was in 2 different places at once at one point by.
But when I opened that box, I didn't want to give it to my girlfriend....
...I wanted to keep it. It was much more beautiful than I could've even pictured.
Barry, you were right about the color not being noticable at all,
the platinum makes it shine. But the engagement went great
and she couldn't believe her eyes.
It sparkles like crazy in the light and she can't stop staring at it.
We were already incredibly happy together
and she would have been happy with anything.
But this definately tops anything I could have bought around here.
I won't even get into the details of how horrible the retail stores are in Houston.
I would have ended up paying twice as much for something
not even comparable to what I received from your store.
The Vatche ring was definately worth the wait...
...I wasn't expecting that great of quality for that price.
I can't say enough.....I'm just amazed by everything.
After all the crap I had to deal with going to retail stores
and listening to BS all day.....you were both a pleasant suprise.
I'm sorry if I was a pain or got on your nerves, I was just going a little crazy waiting.
But it was all worth the wait and all that research paid off.
I'm sure we'll be getting the wedding bands from you.
She won't want to deal with anyone else either.
Can't thank you enough,
Eric
On-Line Holiday Spending Setting Records!
Consumers in the United States took advantage of heavily promoted online sales since November 1, 2006, and have so far spent about $19.5 billion according to comScore Networks. The increase in online sales represents growth of 25 percent and is inline with earlier projections.
Free shipping and guaranteed delivery in time for Christmas (an offering most online retailers skipped in 2005) is driving online sales said Gian Fulgoni, comScore chairman.
Online spending on December 15, 2006, rose 38 percent and the rise was attributed to workers taking advantage of office high-speed connections.
Global Jewelry Sales to reach $230 Billion by 2015
Worldwide jewelry sales will grow 4.6 percent per year to reach $185 billion in 2010 and $230 billion in 2015, according to a new report by the Gem and Jewellery Export Promotion Council of India and KPMG.
"The Global Gems and Jewellery Industry: Vision 2015: Transforming for Growth" finds that gold and diamond jewelry will continue to dominate the industry, with about 82 percent of the market, and that palladium will grow in importance. Diamonds will represent the slowest growing segment of the industry, with a compound annual growth rate of about 3.3 percent.
The report also finds that India and China together will emerge as a market equivalent to the U.S. market by 2015. Further, India's share of the diamond-processing industry will drop from 57 percent today to around 49 percent in 2015, while China will control 21.3 percent of the diamond-processing industry by that time.
Continue reading "Global Jewelry Sales to reach $230 Billion by 2015" »
Have You Finished Your Holiday Shopping?
Holiday shoppers are once again proving to be procrastinators this season, with more than 33 million (15.4 percent) indicating they've yet to start, according to the National Retail Federation's (NRF) 2006 Holiday Consumer Intentions and Actions Survey.
The survey, conducted by Big Research, shows that not all consumers wait, with 23 million (10.8 percent) saying they've completed their holiday shopping. Among those shoppers who have yet to get started, 17.8 percent of men and 13.1 percent of women are waiting until the last minute.
With Christmas falling on a Monday this year, retailers have one more weekend to bring in those holiday procrastinators.
Credit Card Debt Skyrocketing.
Consumer Reports says that Consumer Credit Card is growing rapidly.
In the broad field of averages, consumers in the United States predicted they would be spending between roughly $1,000 and $2,000 on gifts during the December holidays in 2006. Taking into account that the "average" household is already saddled with $9,000 in credit card debt alone, additional charges are seen to present a long-term problem.
The majority --or 77 percent-- planned to use cash, 48 percent of shoppers told Consumer Reports they would use credit cards, 46 percent planned to use debit cards. And those paying with plastic will see the bills --and interest-- pile up. Among those using credit cards to pay for holiday gifts, the average bill will be $626, though 17 percent of shoppers plan on racking up $1,000 or more in holiday charges.
Many say they'll retire holiday credit card debt by the end of January (59 percent,) but 23 percent won't pay off those bills until March or later," which adds $14.6 billion in interest-accruing debt for primarily Christmas gift spending.
Over one-quarter of Americans (26 percent) use credit cards most often when holiday shopping, contributing to the $63.6 billion charged on credit cards throughout the shopping season," according to the statement by Consumer Reports.
"Credit cards can be hazardous to your holiday spending," says Tom Marks of Consumer Reports. "Cash forces you to be much more disciplined, purchasing only what you can afford."
Consumer Reports' poll shoppers planned to buy about 15 gifts, women on average planned to buy 19 gifts and men only 13.
Update on E-Commerce
Interesting Overview and Update.
Bluenile.com CEO, Company Insiders Selling Their Shares.
The Associated Press reports today that Bluenile CEO Mark Vadon sold 4,000 common shares under a prearranged trading plan, according to a Securities and Exchange Commission filing this past Friday.
In a Form 4 filed with the SEC, Mark C. Vadon reported he sold 2,000 shares on Dec. 20 for $35.35 each and another 2,000 the next day for $35.51 apiece.
The stock sale was conducted under a prearranged 10b5-1 trading plan which allows a company insider to set up a program in advance for such transactions, and proceed with them even if he or she comes into possession of material nonpublic information.
Insiders file Form 4s with the SEC to report transactions in their companies' shares. Open market purchases and sales must be reported within two business days of the transaction.
A closer look at the Insider Transactions at Bluenile shows that Mr. Vadon has consistently sold his company shares, totalling 212,149 shares sold since December 29, 2004 with no purchases. Indeed, there has been and continues to be heavy Insider Sales of Bluenile shares by the top Bluenile company executives since December 2004. In the last six months, Bluenile Insiders have sold 170,116 shares and bought 0 shares for their stock portfolios! Does this make sense?
The link is here: Bluenile Insider Stock Sales
Bluenile is currently the leading on-line Internet seller of diamonds and jewelry, reporting sales of 250 million in 2005. Analysts expect 2006 sales to equal or exceed this number.
Why then, are company Insiders selling their shares in droves? What are we missing in this picture? Any Stock Mavens out there with an answer?
2006 Internet Sales Top $100 Billion!
Internet sales surpassed the $100 billion mark for the period January 1, 2006 to December 23, according to data released by comScore Networks. The total is the first time online retail (excluding travel) surpassed $100 billion.
During the first 56 days of the 2006 holiday season, total online retail spending increased 26 percent to $23.11 billion. Sales during the week prior to Christmas (December 18 – December 22,) sales rose 38 percent compared with the same week in 2005.
“Online sales continued to show strong growth during the last week before Christmas when procrastinators were clicking with confidence,” said Gian Fulgoni, chairman of comScore Networks. “Consumers making purchases in those final days expressed both their faith in retailers’ ability to pick and pack their orders in a timely fashion and shippers’ ability to drop them on recipients’ doorsteps in time for Christmas.”
According to comScore Networks, retail e-commerce accounts for approximately 7 percent of consumers’ retail spending (excluding gas, autos and food,) making it an important component of the total economy
Jewelry Gift Cards Collecting Dust.
As of the second week in January, shoppers had spent less than half the value of the holiday gift cards they received, forcing companies to encourage consumers to spend them as soon as possible so they can count as a sale, a new National Retail Federation survey reports.
"January and February tend to be slow months for shopping, so retailers will be doing everything possible to bring customers into the stores to spend holiday gift cards," NRF President and CEO Tracy Mullin said in a media release. "It is in the retailers' best interest to encourage recipients to spend gift cards before they become lost or misplaced."
Retailers also know that customers redeeming gift cards are likely to spend more than the card's value. According to the survey, conducted by Big Research, half of the consumers who redeemed holiday gift cards said they spent beyond the value of the card to purchase an item.
Gift cards, expected to be a common holiday gift, were even more popular than projected. According to the survey, consumers spent an average of $164.81 on gift cards, up from the $146.20 they expected to spend, resulting in $27.8 billion in holiday gift card sales. Men spent the most on gift cards ($176.84), and young adults, ages 18-24, spent the least ($118.12).
According to the survey, gift cards to department stores (37.9 percent), restaurants (26.8 percent), bookstores (18 percent), electronics stores (16.2 percent) and discounters (14.8 percent) were the most popular to give, and most consumers chose to buy the cards from establishments where the cards could be used. Many shoppers, however, purchased store gift cards from other retailers such as convenience stores and supermarkets. Also, nearly one-fifth (17.7percent) of consumers said they purchased a gift card online.
"As gift cards increase in popularity, retailers are looking for more convenient ways to sell them," Big Research Vice President of Strategy Phil Rist said. "Many time-strapped holiday shoppers chose to buy several different gift cards at once by purchasing gift cards at supermarkets or convenience stores, which is a trend we expect to continue."
Diamond Internet Retailer Abazias.com Looking to Sell Out.
We noted with interest last weeks announcement by one of our colleagues, online diamond retailer Abazias.com that they have initiated a formal process to explore a variety of strategic alternatives to enhance shareholder value, including a potential sale of their company. In this statement released on January 31, Abazias.com said it retained Cantor Fitzgerald to act as its exclusive financial advisor in order to examine a range of short and long-term options.
Abazias reported that fiscal 2006 sales increased 58 percent to $4.8 million at Abazias, while the company reduced its loss by 68 percent to $139,613.
We can't say that we're surprised by Abazias move. While Abazias claims to list over 80,000 diamonds, few are actually in-house with them but are based on lists that are supplied to them from Manufacturer/Wholesalers. Diamonds are directly drop-shipped to you the retail consumer by the Wholesaler. Buying blind in this way has it's shortcomings as a diamonds brilliance and sparkle cannot be solely determined just from a Lab Grading report.
Today, Consumers shopping the Internet for Diamonds are more savvy and educated about the 5 C's, including a diamonds Cut Quality and are demanding more information from vendors such as Photo's, Cut Quality Analysis, and measurements of light performance. Supplying consumers with this type of information demands considerable investment in technology and manpower.
We believe that with consumer diamond edcuation spreading and increasing that this announcement by Abazias is just the beginning of a shakeout in the world of diamond e-commerce websites and that other drop-ship diamond e-tailers will also soon come to the realization that diamond drop-shipping is a dead-end road and they will either improve their educational services to the consumer which includes in-house evaluation and testing of the diamonds they sell or bail out.
We wish our friends at Abazias.com the very best of luck as they embark on this new initiative.
Super Sunday "Super" for Jewelers.
Supermarkets and electronics stores are not the only retailers that benefit from Super Bowl Sunday, according to a study released last week from Visa USA.
The study finds that jewelers and florists also see a boon in business. Both businesses experienced more than a 30 percent increase during Super Bowl weekends in 2005 and 2006, compared with other weekends.
Visa Senior Vice President for Business and Economic Analysis Wayne Best said in a statement that Visa expected to see sales increases at retailers that sell chips, dip, beer and televisions, but did not expect the hike in jewelry and flower sales.
Stats for Super Sunday 2007 should be released very soon.
You Can Get SCAMMED On Ebay!
Ebay is a popular internet site for purchasing all kinds of items. It has attracted its share of thieves and scammers ranging from shill bidders, bogus auctions, and manipulated feedback to make the Seller look good.
Here is the latest scam as reported by first person account. Brazen and Scary. Read it and be careful if you're going to shop on Ebay.
Jewelers Get These Tips For Increasing Holiday Sales
Jewelry shopping for Valentine's Day is begining to heat up!
Here is a memo that was recently published to help jewelry stores and websites reach out to the public and increase their bottom line for this Valentine's Day.
Remember; "forearmed is forewarned"!
Don't forget however, although this insider memo may help you resist the moves of your local jeweler.....it certainly won't score you any brownie points with your better half...... :) ;)
"Heat up Valentine's Balance Sheet"
Mine customer lists
Reach out to recent engagement ring or anniversary gift buyers with Valentine's Day ideas.
Work with local vendors
Cross-promotions with community choclatiers or florists can benefit all.
Stock up on lower price points.
Most retailers say Valentine customers tent to seek out cheaper jewelry, more friendly on the wallet.
Don't forget about the other women
Before completing a sale, ask about additional jewelry gifts for mothers and daughters.
Sell to women
Don't forget to target women buying jewelry and watches for the men in their lives.
Whiteflash.com - Diamond Engagement Ring Promotion
Ideal Cut Diamond e-tailer, Whiteflash.com has just announced a new diamond promotion and free diamond solitaire engagement ring giveaway in conjuction with the new romantic dramedy series by Fox called 'The Wedding Bells'
To find out how you can win your free Whiteflash diamond engagement ring, visit Whiteflash by clicking on this link!
Good Luck!
Great Video On Effectively Marketing Your Brand Identity
We blogged a while back on an effective marketing strategy for branding natural fancy yellow diamonds, by one of the foremost experts on product 'branding' in the industry.
We got a great comment from of our readers, with a link to this must see video by the same expert who talks about strategies for creating and promoting an effective 'brand identity'.
"What does your brand say about you"
http://www.scribemedia.org/2006/12/18/evolved-models-for-healthcare-branding/
Are These "Wedding Bells" Off Key?
Romantic Comedies in the movies and television revolving around Weddings and Engagements have always been very popular with the viewing public and have garnered high ratings.
The 'pull' and amazing appeal of these shows/movies is that it allows us to live vicariously through these very handsome and beautiful actors and actresses and that perhaps some day we will experience the same happiness and good fortune.
Just last week we blogged about the upcoming Premiere of a promising romantic comedy show
The Wedding Bells
that revolves around a group of young people providing wedding business services to engaged couples.
The Premier episode of "The Wedding Bells" made its debut last night on FOX and Melanie McFarland, TV & Radio Critic for The Seattle Post Intelligencer has her less than "ringing" review here:
For Whom The Wedding Bell Tolls
Linda Stasi of The New York Post gave it one star out of a possible five. Not good. Her review is here: Off-Key Wedding Bell
Perhaps a move to a better time slot will help.
Buying Your Diamond Engagement Ring on Ebay? Be Very Careful!
Fraudsters and Scam artists are targeting Ebay and PayPal with 'phishing' requests and re-directing to fraudulent websites to con you out of your Credit Card information.
Ebay's response to this has so far been underwhelming according to Internet anti-fraud experts.
The full story is here:
Buying a Diamond Engagement Ring on Ebay? Be Very Careful!
Caveat Emptor!
Spiraling Time. A Cool Watch for Geeks!
What time is it?
Here is a really cool and futuristic watch I found from www.tokyoflash.com
Available in either Black or Silver & with a mirrored blue LCD display it tells the time via a series of spiraling blocks.
Around the outer edges are 60 segments, indicating 1 minute each. They are grouped in 10's so it's easy to tell the time at a glance. The inner spiral of blocks represent 1 hour each.
This is one of those watches that at first it seems impossible to tell the time, but once you understand how it works it's fairly simple. Within a few days of using it you can tell the time just as fast as a traditional wall clock.
The LCD display is mirrored with blue tinted segments. Since the display is "always on" there is no need to push a button to see the time.
This watch also has an animation feature. Once a minute, the display spirals all the way off & all the way on, then settles back onto the current time. (see the animated graphic at the top of the page for the effect) Since this is not a LED light effect, it does not drain battery power nor is it too distracting.
Another notable feature of this watch is it's small size & weight. The strap is a svelte 1.5mm thick, barely more than a Dime & it weighs just 60 grams.
LCD display
English & Japanese Instructions
Time Only
Water Resistant
1 Year Warranty
Exclusive to Tokyoflash
On-line Diamond Engagement Rings and Jewelry sales Up 20% in 2006!
Our colleague Ken Gassman of Idex Online (www.idexonline.com) reports astounding stats for the On-line Diamond and jewelry industry for 2006.
On-line sales reached 2.45 Billion, an increase of 20% over 2005 and represent approximately 3.9% of total jewelry industry sales of 63 Billion in 2006.
Ken goes on to say that while it took seven years – from 1996 to 2002 – for online jewelry sales to reach the $1 billion mark, it took only three years – 2002 to 2005 – to reach $2 billion in total sales. He forcasts continued robust growth of on-line diamond and jewelry sales and projects that sales will hit 3 Billion by 2008!
He projects three different scenarios for future growth with moderating growth the most likely scenario.
The graph below shows Ken's forcast for "moderating growth" over the next several years.
Very nice presentation, Ken.
We will follow this and keep you posted.
Hearts On Fire Moving To Las Vegas.
Hearts On Fire has signed a letter of intent to purchase a significant amount of space in the World Jewelry Center (WJC), as the project builds steam in becoming the new international hub for the gem and jewelry trade.
"The World Jewelry Center is an ideal business platform to support our long-range goals and objectives," Hearts On Fire chief executive officer and founder Glenn Rothman said in a statement.
He noted how the Las Vegas location provides numerous advantages, including international transportation, high-tech communications and favorable business policies.
"The international gem and jewelry marketplace established by the World Jewelry Center will be an important catalyst in further growing the Hearts On Fire brand," he added. "Not only can it serve as a North American distribution center in a strategic location, but the presence of hundreds of dealers and manufacturers, plus gem labs, support services and a Foreign Trade Zone, can greatly enhance our operations."
Bill Boyajian, managing director of the WJC, said the addition of Hearts On Fire exemplifies the benefits companies gain in being a part of the project.
"It's especially noteworthy when an industry leader like Hearts On Fire is added to the who's who of companies now comprising the World Jewelry Center," he said. He went on to praise Rothman as a visionary who has set a remarkable standard in diamond branding and marketing.
"His confidence in the future of the World Jewelry Center is another sign of the momentum propelling this project," Boyajian said.
We blogged about the the new Vegas Mega Diamond and Jewelry Center a few months ago:
Diamond Engagement Rings In Las Vegas
Looks like Las Vegas may very well shape up as the #1 Diamond Center.
Stay tuned.
"Eye" In The Sky Will Find Your Diamond.
For us in the Diamond Trade, one of the highest compliments you can give a colleague is to tell him, "You have a Good Eye" when to it comes to correctly evaluating diamond rough for manufacturing or for assessing and evaluating prices on polished goods.
Now this "Good Eye" has taken a technological leap and is sure to revolutionize the Diamond Mining Industry with the announcement by the Canadian company, Gedex Inc. of their new proprietary technology that will pinpoint diamond deposits and make Canada the largest diamond producer in years to come.
The Globe and Mail reports today that Mississauga-based Gedex Inc. has developed an airborne surveying system capable of "seeing" as far as 12 kilometres beneath the Earth's surface to identify precious metals, oil, gas and minerals that are invisible to current systems.
Gedex's system, a new twist on a century-old idea, has already won the company a mining research award, the first ever given by the Mining Journal, the authoritative 170-year-old British publication. The award was adjudicated by an international panel of experts, who cited Gedex for "primary research that is expected to have the most significance for mining and mining equipment in the future."
Gedex's new system, known as a High Density Airborne Gravity Gradiometer (HD-AGG), uses tiny variations in gravity to identify geological structures beneath the ground. Among the structures it can precisely spot are kimberlite pipes -- vertical columns of rock pushed upward into the Earth's crust by volcanic action far below -- that often contain diamonds.
The Gedex system has its roots in the 19th century, when a Hungarian physicist named Roland, Baron von Eotvos, discovered that variations in gravitational force could help in geophysical exploration, a concept known as gravitational gradiometry. The U.S. military used his ideas to build navigation and missile-targeting systems for submarines during the Cold War.
Gedex also developed a way to use superconducting quantum interference devices, or SQUIDs, to measure tiny variations in gravity. These electronic devices work only at extremely low temperatures, so Gedex encased its instrument in a cryostat, a kind of high-tech cousin of the Thermos bottle that keeps it at roughly absolute zero.
In use in the field, an airplane carrying the HD-AGG flies over the area to be explored. A single pass can cover a strip 60 to 100 metres wide for preliminary exploration; for more detailed mapping the plane flies lower, covering less terrain on each pass.
The device measures minute gravity variations that translate into a colour-coded map of what lies beneath the ground.
DeBeers is hot to get their hands on this technology and is already in talks with Gedex.
This technology will revolutionize diamond mining and exploration.
The full story is here: Diamond Eye In The Sky
Here's looking at you, Kid!!
China Consumer Boom On The Way.
Credit Suisse reports today that China is on course to become the world's second-largest consumer market by 2015, but foreign firms looking to tap the retail boom must brace for a bumpy ride and possible price wars.
Overseas firms now produce far more in China than they sell there, but that is likely to change as the economy comes to rely more on consumption than exports and investment to stoke its sizzling growth.
Credit Suisse projects that the value of Chinese consumption will hit $8.8 trillion by 2020, fueled partly by a 5 percent yearly appreciation in the yuan between now and then.
That would take the Chinese currency to 3.9 to the dollar from 7.73 now.
By 2015, only the United States will be a bigger consumer market.
But devising winning strategies could prove tough amid shifting spending patterns, falling prices for some products and the fact that personal incomes are lagging economic growth.
"The potential of the market is huge," said Vincent Chan, the bank's head of China research. "However, the execution in the process could be tricky," Chen, who penned the report, told a news conference.
Foreign companies such as Coca-Cola Co. (NYSE:KO - news), Nestle (NESN.VX), Procter & Gamble (NYSE:PG - news) and, Swatch (UHR.VX) (UHRN.VX) appeared well-placed to ride the unfolding consumer boom, the report said.
Luxury retailers like LVMH (LVMH.PA), whose handbags are coveted by a small but growing group of super-rich, should benefit given their relatively low advertising overheads.
But companies seeking inroads into the mass market needed to adapt their products to local tastes and be prepared to slash prices to cope with fierce competition, Chan said.
Outsiders would probably find it harder to break into the services sector, where Chinese companies have the upper hand because of their cultural know-how, he said.
Credit Suisse's third China Consumer Survey, based on a 2006 survey of 2,700 respondents in 8 cities, sheds light on spending and saving trends in the world's most populous nation.
As in previous years, the survey concludes that households generally save or invest a quarter of their total income and spend almost the same proportion on food.
Consumers between the ages of 20 and 29, who enjoy the most buoyant income growth, tend to splash out more on clothes and entertainment, making them the prime target group for China-bound retailers.
Some of the country's consumer dynamics are shifting, the report finds: the appetite for electronic goods such as digital cameras and mobile phones is waning, while confidence in the quality of local cosmetics is growing.
As many as 75 percent of those surveyed indicated a reluctance to pay more for foreign cosmetics, up from 62 percent in 2005 and 50 percent in 2004.
More Chinese are traveling, with 52 percent of respondents saying they took a flight in 2006 compared with 48 percent in 2005. The survey found that Southeast Asia is losing popularity to Europe and East Asia as a holiday destination.
We recently blogged on China becoming a world economic power and hospitable venue for diamond and jewelry manufacturing.
Stay tuned.
DeBeers To Start Selling Diamonds Online
New York—De Beers Diamond Jewellers CEO Guy Leymarie said the retail venture will be adding e-commerce to its Web site, DeBeers.com, in the near future.
Federated to Spend $100 million on its E-Commerce!
Federated Department Stores has announced it will put an additional capital investment of approximately $100 million into its direct-to-consumer businesses, including Macys.com, Bloomingdales.com, Bloomingdale's By Mail, Macysweddingchannel.com and Bloomingdalesweddingchannel.com.
The $100 million addition for the 2007-2008 year will be incorporated into Federated's total capital spending plans, which include $1.2 billion for 2007, and $1.1 billion for 2008.
"Currently, we anticipate our direct-to-consumer businesses will grow to more than $1 billion in sales by 2008, from about $620 million in 2006," Federated chairman, president and chief executive officer Terry J. Lundgen said in a statement. "Supporting this pace of growth requires additional investment so we can scale up the volume of business while enhancing customer service, delivery efficiency and online site functionality.
If anyone doubted that the Internet is a major driving force in retail sales, this major investment by Federated should dispel it.
Cool Diamond Jewelry Holder
Since Women are always taking off their diamond rings to wash their hands, I always thought it would be cool to have something unique by the sink to hold your diamond jewelry.
Here is a really nice product I found on the internet
It called the Jewelry Branch and it only cost 26 bucks!
Engagement Rings Advertising On-line: Be careful choosing your Key-Words.
Idex On-line reports this morning that a U.S. court has ruled that jewelry retailer Zale violated trademark rules when it purchased the keywords “dating ring” to advertise via paid online searches on Google, Yahoo, and other search engines.
The holder of the trademark for “The Dating Ring” filed suit against Zale alleging the company violated the trademark because jewelry was displayed when visitors to the company website searched for the term “dating ring”.
Zale rejected the charge, maintaining it did not use the term for any of its jewelry, nor did it use the trademarked words on its website.
Eric Goldman, assistant professor at Santa Clara University School of Law and director of the High Tech Law Institute, said the “ruling implicitly validates Google's policy of letting advertisers buy trademarked keywords - which the court says isn't trademark use - but letting trademark owners block ad copy referencing their trademark, which the court says is a trademark use.”
Great decision Judges! You are essentially playing both sides of the fence. Spoken like true lawyers!
In Brooklyn, You'se guys would be definite maybe's.
Engagement Ring Prices Getting Squeezed.
Our colleague Ken Gassman of Idexonline.com has just pointed out in an excellent article what many of us in the Industry have been painfully aware of for some time:
Prices of diamond engagement rings, loose diamonds, Gold and Platinum jewelry are being squeezed to the bone and profit margins for Vendors are shrinking.
Ken cites several reasons for this trend:
1. Rising prices on diamonds, Gold, and Platinum.
2. Increased competition by specialty Vendors, discount stores such as Walmart, luxury retailers, and of course, The Internet.
The full article is here: Read it.
Where have my Diamond Profits Gone? Long Time Passing!
Why Do Retail Jewelry Stores Hate / Fear The Internet?
Why is it that you ask a local jewelry store owner about buying diamonds on the net and he/she will often curse a blue streak and bash the heck out of the Internet?
What is it about buying diamonds and engagement rings Online in 2007, that has become such a threat to traditional "brick and mortar" jewelers across the country?
Why do the traditional jewelry store owners fear the net so much and what is it specifically that bothers them?
Why are the savvy jewelry store owners learning to embrace the Internet and looking to build out a website for their company in cyberspace?
There is one answer to all of these questions and it has everything to do with two variables: Quality and Price.
Let us first examine the facts:
Online jewelry sales since 2005 is up 3.5% in contrast to all other retail categories which are up 2.3%.
Online diamond and jewelry sales have been surging and were up about 3.5 percent of total fine jewelry sales in the U.S. in 2005. Since that time, the number has steadily gone up. Clearly, online jewelry merchants have captured substantial market share and are stealing business from the local jewelry stores.
The obvious question is why?
Internet retailers operate with much lower gross margins than store-based jewelers. This allows them to sell diamonds and jewelry at much lower prices than the retail stores. In fact, retail stores will often charge several thousand dollars more for similar quality merchandise being sold on the net.
Diamonds sold on the Internet are much less expensive than in the stores.
Furthermore, online jewelers have very high inventory turns as a result of their ability to operate of much lower profit margins. Because of the favorable terms online retailers have negotiated with their suppliers, they have negative working capital needs.
Online jewelry retailers have slashed prices and sales have soared as a result. They are willing and able to make fewer percentage points on every individual sale and to make up for it in volume.
They also cannot afford to charge the same kind of hugely inflated premiums you find in the typical jewelry stores.
Competition on the Internet is fierce and everyone is just "one click away" from the consumer.
Consumers who shop on the Internet are also by definition, extremely savvy and knowledgeable.
They demand accurate and scientific proof and information on every diamond or engagement ring they are contemplating.
Just to have a nice sales person behind the counter say the diamond is "the best thing since sliced bread" (with a smile...;-) will simply not do.
Jewelry stores who operate off a completely different business model of limited diamond information and maximum markups, simply cannot compete.
Statistics show that they are losing significant sales and market share to the Internet.
Indeed, a customer who completes a satisfactory purchase on the internet for any product is highly unlikely to ever buy locally again. The lure of maximum value, quality of merchandise and lowest prices, all without having to leave the comfort of your home or work is certainly formidable.
Those store based diamond and jewelry retailers who have seen the writing on the wall and witnessed the Internet revolution, have sought to embrace and accept the "age of the net" by creating their own web stores where they can compete for some of this market share.
Unfortunately, many of these traditional "bricks and mortar" jewelers remain in denial; completely bitter and upset.
Once you taste the joys of huge profits and have made a literal "killing" on the sale of every loose diamond, it is extremely difficult to accept the idea of embracing the net where diamonds are sold at razor thin profit margins.
It is for this reason (just as an example) that the incredibly expensive Hearts on Fire Diamonds Brand is the flagship diamond of choice for every store based jeweler (astronomical profits on every stone), but could never survive if it were marketed on the Internet.
It is also why those store based jewelers of the old school:
a. Hate the Internet
b. Fear the Internet
c. Mock the internet
d. Lose sales everyday to the Internet.
e. Have nightmares about the Internet.
Blue Nile Engagement Rings Crossing The Atlantic.
The London Financial Times reports today that Blue Nile, the online seller of diamonds and jewelery, is to become one of the first “pure play” US retailers to cross the Atlantic, in a move that reflects the growing interest of such companies in international expansion.
The potential of international sales for US retailers has been demonstrated by Amazon, the world’s largest retailing website. Amazon’s sites in the UK, Japan, Germany, China and France accounted for 46 per cent of the company’s $3bn sales in its first quarter, and rose faster than North American sales.
Scott Silverman, executive director of Shop.org, an association whose membership is made up of US e-commerce retailers, said he had seen evidence of growing interest in international markets as his members became more confident.
“Companies such as Blue Nile that have been around for six or seven years are pretty big. They are seeing some signs that 50 per cent per year growth cannot continue, so international expansions seem to be an increasingly attractive option for them,” he said.
At the same time, UK underwear retailer Figleaves.com and the Italian fashion site Yoox have established US offshoots.
Jim Okamura, partner at JC Williams retail consultancy, noted that online-led international expansion is being explored by US chains that have started to reach the limits of market growth at home.
“It’s not for everyone, but we’ve definitely seen a growing interest in international expansion strategies that use an e-commerce platform as an initial entry point,” he said, citing efforts by JC Penney and Victoria’s Secret to develop online sales in Canada.
Blue Nile says its operation will be in Ireland and involve “only a handful of employees”, with site technology handled from the US. So far, it has sold goods worth about $3.3m to UK customers using a trial site with products priced in dollars.
A report out on Monday says US online sales excluding travel rose an estimated 29 per cent in the past year to $146.5 billion.
Are Women Really Hesitant To Buy Jewelry Online?
JCK recently conducted a survey of womens purchasing habits online.
Here is what they came up with:
A total of 96% of American women who have shopped online in the past 12 months have purchased at least one product over the Web, according to a poll. Most online shoppers (57%) do both their product research and shopping online while a sizeable proportion do their research online and then go to a store to buy (31%).
"But, despite the fact that women seem to be so comfortable with online shopping, ShopSmart's poll results show that there are still a lot of 'gotchas' out there," said Lisa Lee Freeman, editor-in-chief of ShopSmart, a new magazine by the Consumer Reports National Research Center, which conducted the survey.
Among the findings of the The ShopSmart Online Shopping Poll:
* Seventeen percent of women surveyed say they would never consider buying food on the Web followed by clothing (14%), shoes (8%), and jewelry (7%).
The article the goes on to make some additional observations regarding womens shopping habits online.
I have a bit of a problem with this survey.
For one thing, the survey was conducted amongst women who have already tasted the experience of shopping online.
While a percentage of these women polled certainly expressed a reluctance to purchase certain items on the Internet, while being entirely comfortable with the idea of purchasing other products Online; the reality is that one cannot extrapolate from here that women in general are "reluctant to buy jewelry online".
This logic is IMO incredibly flawed since the survey did not address the incredible surge in stats for Online jewelry shopping (both men and women) in general.
Certainly, people who have already shopped Online may be more comfortable buying certain products and hesitant (initially) to buy others.
However, the reality is that the amount of consumers who have turned to the Internet (both men and women) to purchase diamonds and jewelry is growing by leaps and bounds with no signs of slowing down.
In fact, here is a recent survey regarding women who shop online that indicates and supports exactly what I am saying. Namely; the fact that women are a growing force in the world of online shopping.
Remember Ashford.com? It is Being Resurrected.
Luxi group, a private holding company in New York focused on the luxury goods market, has acquired certain assets related to Ashford.com from Odimo for $400,000.
Luxi group said in a statement that it will re-launch Ashford.com with a large selection of designer and brand name watches and other luxury products.
About Ashford.com
Ashford.com was launched in 1998 and in 2001 it led the online luxury market with revenues exceeding $65 million.
Garry Holloway Talks In Vegas
Garry Holloway, who owns the diamond Ideal Scope technology used by many diamond dealers and sells diamond jewelry in Australia, was a featured speaker at this years Vegas show.
His topic; "Harnessing the Latest Technologies to Break Through.”
His discussion focused on the need for jewelers to embrace the Internet diamond revolution, or be sucked under by it.
His speech, although not entirely original and pretty much recycled stuff, was well received nonetheless.
Amongst the things he said is that “Younger consumers are going to visit a Web site before they visit anything else. That’s just the way young people are these days.”
He said retailers who embrace the young generations thirst for knowledge, will turn to the Internet to help supplement their in-store sales.
He encouraged websites to "engage" the consumer in "chat" and to find out exactly what their needs and desires are.
He further advised retailers to participate in Web forums and discussion groups, which let people learn “hip new design and diamond terms” as well as to get a comprehensive diamond education. “You need to know more about diamonds than the best-educated consumer to keep the children of your best clients as customers,” he said.
"Iced out" Jewels For $5.95!
This product brings new meaning to "putting your jewelry on ice".
This is a really cool idea for those summer time BBQ's and get togethers...especially if you are a diamond or jewelry lover (who isn't?)!
Add a splash of flash and sparkle to your drinks with some icy gems. This flexible plastic ice tray makes six gemstone-shaped ice cubes. Add some food coloring and you'll have some faux precious stones to keep your drinks nice and cold.
Product Features
• Gemstone shapes
• Reusable
• Recyclable, flexible TPE plastic
• Dishwasher-safe
Buy it here for $5.95
Is Paris Hilton Asset Or Liability For Online Diamond Retailer?
Online diamond retailer Abazias.com recently introduced millionaire Paris Hilton's designer watch brand on their e-commerce site and indicated:
"Paris Hilton has made a name for herself on the fashion scene with her newly launched watch collections that tie together her exceptional sense of fashion with classic and wearable pieces. Available only at exclusive retailers, Abazias Diamonds is proud to carry exclusive pieces from Paris Hilton's newest watch collection."
Paris Hilton with Oscar Rodriguez, CEO of Abazias.com
The "Paris Hilton Watch"
Typically, a company selling a luxury product will associate themselves with a high profile, celebrity "ambassador," to help promote a stable, consistent, refined, upscale, classy, etc. brand image...
For obvious and well known/well documented reasons, Paris Hilton's name doesn't exactly conjure up any of the aforementioned attributes and characteristics......
In my linked article above, brand expert Ramesh Thomas, mentions the following guidelines for companies looking for a celebrity to help endorse their own brand image:
a. "Articulate with clarity on the brand promise (What am I?) and the brand personality (Who am I?).
b. Create consensus among the brand team on what the communication objectives for the campaign are.
c. Focus on the characteristics the chosen celebrity should possess, in order to provide synergy with the brand to be advertised.
d. Overtly establish what the celebrity is going to communicate.
Once these criteria are met, endorsements can work as a force multiplier. On the flip side, the greatest danger is that because celebrities already carry a strong brand character, a mismatch could be counterproductive to the brand. It is very tempting to be carried away by the short-term exposure and interest that an endorsement could generate. "
If you subscribe to the aforementioned approach, then showcasing Paris Hilton as a quasi "Ambassador" of sorts and in tandem with the sale of any luxury item; be it watches, diamonds, engagement rings, etc... might not be such a great idea.
Indeed, Paris Hilton has just been released from her 45 day stint serving time in prison for yet another infraction. It seems even by her standards, she has hit a new low in her imploding life and is the fodder for every tabloid this side of the continent.
To be sure, she is getting some amazing press...none of it good.
However, the flip side of this equation is the age old expression "no publicity is bad publicity".
The fact of the matter is, Paris Hilton is a fashionista and celebrity with huge appeal and a significant fan club to rival her many detractors.
An endorsement by Paris, or a market driven focus or initiative, using her as a springboard might have an even greater impact given her newfound...err....social status as an ex con.
So while Abazias continues to feature Paris Hilton prominently on its website, I am left wondering again, is it really true, the expression; "there is no such thing as bad publicity"????
Hmm....food for thought.....I guess.
How The Internet Has Changed The Diamond Industry
With the recent passing of Rockdoc, who was a pioneer of consumer advocacy for diamond and jewelry buying on the Internet, I found myself thinking today how the Internet has totally and dramatically changed the face of the diamond industry.
In this recent blog entry on Excel Diamonds, I focused on the tremendous difference in pricing between the same diamonds and jewelry sold in the stores vs. on the Internet.
However, that is certainly not the only way the Internet has changed the face of the industry.
Here are a few more:
Transparency
Full disclosure of all products and policies.
Everyone selling diamonds on the Internet lives in the proverbial "glass house". They will either earn your business with full customer support, service and actual information; or they will lose the sale to the next guy.
As a result, no longer can a store sell a diamond to a savvy consumer who found the net, by showing a diamond without proper information and attribution related to the diamonds certification, cut precision and light performance. To be sure, many consumers will still opt to purchase their diamonds and jewelry from a local jewelry store, but often only after an exhaustive on-line research and education. This has forced jewelry stores to reevaluate and adapt to the changing market, by actually selling a diamond with real info. in addition to the romance and fluff (which are important too..)
Quality
Internet websites will typically have the ability to showcase far better quality diamonds than you will find in the typical jewelery stores. These are often loose diamonds with ideal cut diamond parameters and quality grading reports (GIA and AGS Diamond Certification). This is because most Internet savvy shoppers would never touch some of the frozen spit being passed off as "diamonds" in some of the mall (a.k.a. maul..;-)) stores. Stores make more money selling inferior merchandise to the unsuspecting and uneducated consumers who care primarily about diamond size and still make up the market share of mall/jewelry store clientele.
Selection
Diamond & jewelry websites typically work off listings of wholesale diamond databases of many thousands of diamonds they do not own. This method, although not without its own problems, also gives them the ability to offer a much greater selection of loose diamonds in all shapes, sizes, colors, clarities and cut qualities.
Build Your Own Ring
Most jewelry stores will sell pre-fab or pre-set diamond engagement rings, where the customer must be satisfied with the combination of all of the important diamond variables and even the selection of the actual ring setting.
Not so with internet diamond websites, who will typically offer their clients the ability to literally build their own diamond engagement ring from scratch. The customer will first pick the loose diamond and then the perfect engagement ring setting to go along with it. The completed engagement ring is then shipped to the customer in a beautiful presentation case.
The truth of the matter, is that many traditional "brick & mortar" jewelers who have seen the "writing on the wall", so to speak; have actually embraced the age of the Internet.
They have built their own websites for their clients and will offer many of the same services and opportunities as the Internet diamond websites.
Certainly, this creates a win-win situation for the traditional jewelery stores and provides customers with a great and way to shop for diamonds and jewelry within the traditional jewelry store framework.
The Flip Side.
Not everything is always "peaches and cream" with websites selling diamonds and jewelery.
1. Not all Internet websites selling diamonds are reputable.
2. Many Internet websites never actually see the diamonds they sell. This is a BIG problem.
The bottom line, just like with anything else is that proper research should be done before buying diamonds and jewelery.
In the final analysis however, there is little doubt that the Internet has had a tremendous and positive impact upon the diamond industry and will continue to do so for many decades.
Ebay Makes Changes to Help Engagement Ring Shoppers.
Buying a diamond engagement ring on ebay can be hazardous to your wallet and we have blogged on this in the past: Ebay diamond listings: Caveat Emptor
Recognizing this, eBay last week announced a change in its listing rules for diamonds, synthetic and natural, and imitation diamonds. To be listed as a real diamond, stones must be natural mineral “consisting essentially of pure carbon, crystallized in the isometric system with a hardness of 10, a specific gravity of approximately 3.52 and a refractive index of 2.42.”
Synthetically-produced stones must be preceded by one of the following words, spelled out in full: created, lab-created, man-made, synthetic, manufactured, laboratory-grown, laboratory-created, or [manufacturer name]-created.
When listing a product in the “Diamond” category, the seller must also specify a sub-category. Only naturally mined diamonds that have not been enhanced may be listed as “Natural”.
Naturally mined diamonds that have been enhanced to reduce flaws may only be listed in the “Natural Enhanced” sub-category. Laboratory-grown stones with the same mineral composition as a naturally mined diamond may only be listed in the “Synthetic” sub-category.
Imitation stones, including Cubic Zirconia, Moissanite, quartz, etc. may be listed as diamonds only if the word “diamond” is immediately preceded or followed by the words “simulated” or “imitation”, spelled out in full. Sellers must also include the real name of the material (such as ‘Cubic Zirconia’) in the item description and in equal visibility to other terms.
In our opinion this move by eBay should have been instituted a long time ago but is better late than never and no doubt the result of numerous consumer complaints as well as negative publicity on several Diamond Internet Chat Forums.
No question that this move will help consumers from getting ripped off.
In our opinion if you are seriously considering buying a diamond engagement ring from an eBay Vendor make sure it comes with either a GIA (Gemological Institute of America) or AGS (American Gem Society) lab grading report. These diamond grading labs are the best in the world for their accuracy, strictness, and consistency in diamond grading. Accept no substitutes.
Buying Diamond Engagement Rings Online: How's it Looking?
A few short years ago the a suggestion to buy a diamond engagement ring on-line to the tune of thousands of dollars would have been met with an icy incredulous stare and a reach for the Digitalis.
Fast forward to today where increasing numbers of consumers are very comfortable buying their diamonds and jewelry from an Internet website.
Our colleague, Edahn Golan reports in Idex that ten U.S. Jewelers are among the top 500 on-line retailers.
According to the table compiled by Internet Retailer you will find a venerable name such as Tiffany as well as some names you may not be familiar with.
Top Ten Internet Jewelry Retailers.
Times, they are a'changin.
Tax & Spend Rangel Wants Your Diamond Engagement Ring Money!
U.S. Congressman Charles B. Rangel received enthusiastic applause as he opened the Jewelers Association New York Summer Show on Sunday with a message of support for the Brick & Mortar Jewelers on the issue of taxing online diamond retailers.
House Ways & Means Chairman Charles Rangel at the Podium.
Rangel, the chairman of the House of Representatives' Ways and Means Committee, indicated his support for brick-and-mortar jewelers. In particular, he touched on legislation in the current session of Congress that would allow individual states to collect sales tax from Internet retailers.
"Whether it's the Ways and Means Committee or whether it's national policy, we have to concentrate on small retailers, making it possible for them to be able to play with a level playing field," he said, referring to the legislation that would help achieve this goal.
From our vantage point, taxing Internet diamond and jewelry sales will not by itself level the playing field for B&M Jewelers as Internet prices will still be lower.
Gotta love those Polticians
Internet Jewelry and Watch Sales Continue Surging in 2Q.
Online jewelry and watch sales increased 32 percent in the second quarter of 2007, compared with the same period last year, according to a recent report on U.S. e-commerce spending from ComScore.
The top-gaining e-commerce category in the second quarter versus a year ago was video games, consoles and accessories, which jumped 159 percent on the strength of Nintendo Wii and PlayStation 3 sales. Sports and fitness also saw substantial gains (up 58 percent), followed by consumer electronics (up 51 percent) and event tickets (up 44 percent).
Based on these growth rates, total U.S. online consumer spending is on track to reach $200 billion in 2007, compared with 170.8 billion in 2006.
WOW!!
The Case Of The Missing Diamond & The Problem With Buying Diamonds From A "Drop Shipper".
We have blogged here and elswhere many times in the past, regarding the perils of purchasing a loose diamond from an internet store who does not physically own or view the diamond in person before you receive it.
Diamond "drop-shipping", is where an internet website selling diamonds, showcases many thousands of diamonds they do not own or have in their physical possession.
The diamonds are comprised from lists of wholesale diamond databases supplied to these vendors by the respective manufacturers who do not deal directly with the public.
When a diamond is sold via the website, the stone is shipped out directly from the manufacturer to the customer, without passing through the hands of the middleman (drop-shipper) first.
I have previously pointed out why buying diamonds this way (to the tune of thousands of dollars) is a recipe for absolute disaster, since the diamond vendor is clueless about the quality of the diamond he has never seen and cannot possibly vouch for the stone in confidence, based upon the limited info. (diamond grading report) provided to him by the manufacturer.
Certainly, if you wish to know actual details regarding the look, brilliancy, inclusions, etc. of the diamond, you are literally on your own.
Indeed, there are only a handful of companies selling diamonds on the internet, who actually have the ability and inclination to personally inspect every single diamond they sell, even when it is one outside of their own manufacture.
Well, here is another reason to be careful when purchasing a loose diamond from a website that acts as a middleman to sell a diamond they have never seen.
The case of the missing diamond.
A very upset customer posted today on the popular diamond discussion forum, Pricescope, regarding her experience with a diamond "drop shipper" who was supposed to ship two diamonds (which she paid for) but only sent one!
She writes: " remember my thread about me buying my 2 stones from BlueNile from my Blue Amex. Anyway got the package today and it only contain one stone but 2 cert. from GIA. I call their customer service and hopefully they will call me back soon . Okay , i'm freaking out and piss at the service don't they check before shipping it out? We talking about diamonds for god sake. "
Well, unfortunately, the answer is no, they do not "check" before they ship out, simply because they do not do the shipping. In fact, they never saw the diamonds which were not of their own manufacture and were never in their physical possession in the first place.
Sure enough, she posts a bit later with the following update:
"Got a call from Mike at Blue Nile after i call them to follow up, he told me to look everywhere in the box, vendor said it might be pack in a little plastic bag or sometime wrap up in a piece of paper or bubble wraps. I told him my package have no bubbles wrap no little plastic bag or piece of paper, i also told him that i only get one plastic pouch that the GIA cert. supposed to come with. So he ask me to wait and will get back in 1 hr or so.
Bingo!
Blue Nile proceeded to call the wholesaler (who actually shipped the diamond (s) to the customer) in order to find out what happened to the missing stone. Wholesaler responds by saying they are pretty sure the second diamond was included in the package and asks Blue Nile to request that the customer "look a bit harder".
Customer is confident that only one diamond was shipped and no other.
Major Problem!
Now the reality is that mistakes do happen and Blue Nile is a reputable company. Hopefully, they will get to the bottom of this and make sure the customer gets the second diamond she paid for.
However, the bigger problem (and one that the customer was clearly unaware of, by the way she posted..) is that Blue Nile never actually inspected the two diamonds they sold this woman.
They therefore had no way of discussing the quality or beauty of the diamond with any authority.
Obviously, they also have no idea how many diamonds were actually shipped with the package.
Sure, they offer return polices and are backed by an honest reputation. However, it is still important for customers to be informed and aware of the way they are purchasing diamonds over the Internet.
To be clear, many loose diamonds are sold over the Internet every single day by honest and reputable companies who never get to see the stone. These companies offer return polices and customer service guarantees which are designed to foster trust and quality assurance. Additionally, there is nothing inherently wrong with acting as a middleman to sell wholesale diamonds at a profit. This is called capitalism; everyone does it and many of these companies are completely honest and reputable.
Still, it is important to realize that Diamonds are not all created equal.
It is important and crucial to inspect a diamond for its structural integrity, cut precision, quality and beauty/light performance, before making a purchase of this magnitude.
Tax -Free Diamond Engagement Rings Makes Big Sense (Cents)!
Two weeks ago we noted here "Tax and Spend" Charlie Rangels' oration at the New York Summer Jewelers Association Show held at New York's Javits Center advocating to the assembled Brick and Mortar Jewelers the taxing of Internet Diamond Websites so as to "level the playing field" and help the B&M jewelers compete against Internet Diamond and Engagement Rings websites.
Charlie (Democrat, New York) is Chairman of the House Ways and Means Committee and in the spirit of Politicians everywhere has never met a Tax he didn't like. He'll find a "Ways" and "Means" to implement it into Law.
The fact is that cutting taxes, not raising them, is the "Ways and Means" to spur sales and economic growth. In every instance where taxes have been reduced, sales and economic growth have dramatically increased as have collection of tax revenues with the concomitant growth of a solid middle-class that is the foundation of political and economic stability.
The most recent example of this tax-cutting benefit for Merchants and Consumers alike is this morning's report by the Boston Herald Tax Free Makes Great Business Sense.
Cutting taxes, not raising them is the "Ways and Means" to go. Are you listening Charlie? Brick and Mortar Jewelers?
Jewelry Store Or Internet Diamond Store? The Perfect Formula!
With much being written regarding buying diamonds & jewelry in the stores versus on the net, it is important to understand that there is always going to be a market for the "bricks and mortar" jewelry stores as well as for internet diamond and jewelry stores.
It is certainly true that the age of the Internet offers the educated consumer the ability to purchase high quality diamonds and jewelry at fabulously low and competitive prices, previously unheard of in the local jewelry stores. We blogged on this some time ago. In fact, I actually created a video to specifically discuss the most notable "price discrepancy" between traditional jewelry stores and Internet jewelry stores.
In another blog entry from some time ago, we discussed in general how the Internet has revolutionized the diamond industry.
In reality, the most meaningful "value" factor which the Internet has spawned and cultivated, is that of competition.
The mechanics of competition, is ultimately a boon for both the trade and consumers, since it forces everyone to be at the "top of their game" in terms of the quality of merchandise and value and services provided.
Still, the reality is that many diamond and jewelry shoppers are reluctant to give up the safety and relative security of the local jewelry store experience.....at any "cost".
The Perfect Formula For Success.
Reputable Internet diamond stores who offer actual data and valuable information on every loose diamond they sell in addition to their lowest prices, are absolutely at the top of the pack in terms of the quintissential online consumer shopping experience.
A few Internet diamond dealers make a commitment to personally evaluate each and every loose diamond prior to the sale and to never engage in blind "drop-shipping" of the merchandise they sell.
Similarly, jewelry stores who wish to stay ahead of the curve and compete with the Internet, have done an admirable job of keeping clients and cultivating new ones from amongst the Internet savvy and educated masses.
Some traditional jewelry stores have created an online presence or "catalog", where consumers can browse diamonds and jewelry, as well as sign up for specials and sale promotions.
A few, have even lowered their previously inflated profit margins to better compete with the Internet diamond websites.
They have embraced the Internet and have turned the Internet business model to their advantage by offering the same services, comprehensive information content and price structure, with the added value of the retail "in-store" shopping experience.
These jewelers are no longer "scared" by the net and are very comfortable around the "Internet savvy" diamond and jewelry shoppers.
I just saw a great posting from Stan at Gerson & Horowitz Diamonds entitled "How to BEAT The Internet".
Surf The Web and Spend More In The Store!
I just noticed this interesting article on Jewelers Circular Keystone.
A $10 Naturally Pink Sapphire on E-bay; Fact or Fiction?
Heads Up! Fellas!!
A woman I have been corresponding with regarding an engagement ring, is looking for a natural 1.00 carat pink sapphire to set in the center.
Anyway, we are corresponding back and forth and she sends me a link to a 1 carat plus- pink sapphire on e-bay, currently listed at $18 with no reserve. She further indicates that there are "$10 pink sapphires" selling on e-bay. She wants to know what I think.
So, I take a look at the listing..and lo and behold, there is a strategically placed and extremely vague indication that the stone has been treated and is "heated".
Right here is the dead giveaway that this stone is not the rare and expensive NATURALLY pink sapphire, she thought it was.
I am still and always amazed that consumers are so eager to believe that sellers are literally giving away valuable, expensive diamonds and jewelry on e-bay for absolutely nothing!!
Here was my response to this woman's request for my thoughts:
---------------------------------------
XXXXXXXX,
DON'T!!!!
It is not a naturally pink sapphire (rare and very valuable).
It has been heated in a special process that gives it its color...
Please re-read the (cleverly) presented information very carefully.
Purchasing these kind of items on e-bay is dangerous and should be done at your own peril...and yes, there are many horror stories.
Indeed, many of the "success stories" are also from unsuspecting and uneducated consumers, who have been lured by the $ tag and simply don't know any better.
They either don't wish to learn and educate themselves, or they simply do not care at those prices.
Either way, nobody is altruistically inclined to give away something for nothing.
You gotta tell yourself this:
You know approx. how much a real, natural pink sapphire has to cost right?
Right?
Now, if somebody is selling something that looks like it might be a sapphire...for ten bucks!! and he is making a profit on that amount!!...then what exactly could you be getting already???
No, I cannot source you a true and beautiful, natural pink sapphire in a 1.00 carat for ten dollars.
I might also add, if you purchase a "sapphire" on e-bay for $10 that is certainly your right and I respect that.
However, our company will not set this stone in one of our rings, due to liability issues.
I have no doubt that in the severe heating process of setting and polishing this stone in a ring, the coloration might come out, the stone might break, or any one of a number of other possibilities related to the structural integrity of a $10 "gem".
We cannot and will not assume that responsibility.
Your call.
Regards,
BlueNile Engagement Rings: Should You Buy or Sell This Stock?
Interesting article appearing today in the Motley Fool on whether Bluenile stock is a Buy or Sell candidate. Buy BlueNile?
Read both points of view and see what you think.
Being Addicted To The Internet. Is It Good Or Bad?
There is no question that the Internet has changed the face of the world. Just ask Al Gore, he'll tell you....;-)
Seriously, this revolution is not simply relegated to the world of commerce. Rather, it is just as prevalent in the world of entertainment, communication, information etc.
Simply put, the Internet is a monster and is quite addictive.
Think of how many people spend their entire days staring at a computer screen for one reason or another and you will understand the enormity of this network.
For better or for worse, people are addicted to the Internet.
Personally, I use the Internet for business. However, I am just as wont to "surf the net" looking for items of interest, especially for the purposes of this blog.
I sell diamonds on the Internet
In this respect, the Internet is actually a positive thing for me.
However, I also understand the gravitational pull of the Net for all kinds of things, whereby the Internet can potentially become a huge time waster and a source of angst for many people.
It is for this reason that (believe it or not) I do not use a computer at home. When I am home I like to spend time with my family. I stare at a computer all day. When I am home, my family deserves my attention and I deserve the pleasure of their unimpeded company and companionship.
This is not simply a luxury which I allow myself, it is truly a necessity. I simply need "down time".
Here is an article I wrote some time ago detailing my desire not to mix "Business & Pleasure".
However, for some people the Internet is a nightmare and a bad addiction. These are people who do not require the Internet in order to conduct their business and make a living. Instead, the Internet draws them in with its addictive powers related to all sorts of pursuits.
Many of these people wind up wasting untold hours and days on the Net, often at the expense of their jobs, families, quality of life and personal happiness.
The Internet can be a powerful and bad addiction.
Indeed, it is often difficult to balance the positive aspects of the Internet with some of its potential pitfalls.
So where do you fit in?
Is the Internet a good thing or bad thing for you?
Do you use it to your own advantage, or does it end up "using you"??
Feel free to chime in.
Tiffany's Takes eBay to Court.
The Associated Press reports today that Tiffany's is accusing eBay of allowing the sale of tens of thousands of pieces of counterfeit Tiffany jewelry on its website.
Lawyers for the San Jose-based eBay responded by saying Tiffany's not doing its share to protect customers.
The arguments in the Manhattan federal court came at the start of a trial to decide whether eBay can be blamed for the sales of silver Tiffany knockoffs on its Internet site since 2003.
Tiffany officials randomly bought 325 items being sold as genuine Tiffany jewelry on eBay's website. They say 75 percent turned out to be fake.
The jewelry company says there was no evidence that eBay did anything to stop the false sales after it reported its findings.
But the Internet auction site says it's suspended hundreds of thousands of sellers who broke its rules.
Internet Diamond & Jewelry Sales Keep Rising!
According to comScore, Jewelry and watches sales by U.S. e-commerce sites rose 19 percent in October compared to the year before, remaining one of the hottest online retail categories. This growth outpaced total online retail sales, which grew 14 percent to $16.476 billion.
The video games, consoles & accessories category posted the strongest gains, jumping 264 percent, driven by strong sales of Nintendo Wii and Sony PlayStation consoles and accessories. Furniture, appliances & equipment also experienced a strong month, growing 105 percent, followed by computer software (up 76 percent) and event tickets (up 43 percent).
Blue Nile Engagement Rings
Interesting discussion on the diamond.info Forum about Blue Nile and how they sell diamonds on the Internet Here
Excel Diamonds Introduces New Diamond Search Tools In Time For Holidays!
We just got finished completing our new diamond sliders and search tools in time for the Holiday Season!
These new tools use the latest AJAX Technology to effectively and quickly sift through many thousands of diamonds to find the loose diamond that best matches your criterion.
These tools will immeasurably increase the usability, functionality and intuitiveness of a loose diamond search on our website.
The user is able to filter based on shape, size, color, clarity, price and even table and depth percentages.
All searches are saved and the user can search in increments of .001.
In addition, we have also introduced a new side by side diamond comparison which will allow the user to compare any 1-2-3-4 diamonds side by side with all relevant information on the screen in front of them.
We are excited about this new feature and implementation and look forward to your positive feedback.
It's Cyber Monday For Online Diamond Websites!
NEW YORK — Retailers are hoping last week's strong start to the holiday shopping season at malls and stores translates into a busy buying season online, which officially begins Monday (today).
The Monday after Thanksgiving, tagged "Cyber Monday" by the National Retail Federation, marks the first big online shopping surge for many merchants as consumers return to their work computers.
A number of retailers are hosting one-day sales or special offers for the occasion. Internet research firm ComScore Inc. estimated online sales may exceed $700 million online on Monday.
Traditionally, Cyber Monday has been viewed as the Kickoff to the holiday selling season for online merchants of diamonds, engagement rings and fine jewelry.
Many diamond websites and vendors are offering steep discounts on loose diamonds, diamond jewelry and engagement rings purchased online during the next few days and weeks.
Here are a few "heads-up" links to various online e-tailers offering special Holiday diamond deals.
1. Blue Nile is offering a 20% discount for jewelry purchased today via PayPal.
2. Ice.com offers Free Shipping on all orders.
3. Special deals on Diamond Safe.
4. Free Shipping Diamonds On Web
5. Free Shipping Excel Diamonds
6. Free Shipping and up to 70% on Zales
7. $100 gift certificate for every $300 spent at Kay Jewelers
8. $50 off on many items and free 3 day shipping at Helzberg
9. 20% with Ross-Simmons
10. Up to 10% with Whiteflash
11. Up to 78% with Prime Style
12. Free Shipping (today only) with Tiffany
13. Many discounts on diamond jewelry at Amazon.
Outrageous Marriage Video Proposal
Online diamond merchant James Allen just launched a new video contest featuring this outrageous marriage proposal video created by www.Viral-Campaigns.com and which they are hosting on their website.
The video is obviously funny and I got a good laugh from it. I'm sure it was created in the spirit of good cheer and humor. However, I'm not entirely certain of the marketing strategy vis a vis the use of this video as a marketing tool for an online diamond merchant given that they cater equally to many women who might find this video offensive.
I guess if the purpose is to engender some laughs and good cheer then it works.... though you may notice most of the posted responses coming from the male gender.....
It would be interesting to know how women might react to this video?
Will they derive the same laugh and recognize some good natured humor in this video?
Or, will they take offense to the possibly sexist overtones of this video and wonder why it is being hosted by a website looking to appeal equally to the female gender?
From a standpoint of generating immediate and considerable social and viral traffic to the James Allen diamonds website, this video is great. Already, the video has close to 25,000 views and that number is sure to grow quickly as the video gets "seeded' all over the net.
To this end, JamesAllen would not be the first online diamond merchant to create a video of this nature for immediate and considerable viral traffic. Of course, the more provocative and explicit the video is, the more attention it gets.
"There is no such thing as bad publicity" and these videos are designed to bring considerable traffic to the hosting companies website which hopefully translates into increased sales and conversions. There are several online diamond merchants who have already hosted and published videos for this purpose.
The question I have is whether the specific nature of the video is something which will ultimately appeal to and influence the "pocketbooks" of the many consumers (certainly women) who are the ultimate target audience for this video's creation in the first place?
Food for thought and I guess time will tell.
Either way, the video is pretty funny!
Consumers Want That Warm Fuzzy Feeling Shopping on The Internet.
Allurent Inc. in its third annual Holiday Shopping Survey of Online Customer Experiences, reports that 67 percent of consumers said they expect greater quality of their online shopping experience.
The top reason for the increased expectations was constantly improving technology (66 percent).
Other reasons cited were:
1. Consistent advertising of Web sites by retailers, which makes shoppers think they should be investing more in improving the sites (46 percent).
2. Consumers having high-speed bandwidth and wanting sites to present products in a way that takes advantage of this (41 percent); and expecting sites to be innovative, like Google Maps and Facebook (29 percent).
3. Forty percent of consumers surveyed said a frustrating online experience would make them less likely to shop at a retailer's physical store, while 60 percent reported a negative online experience affects their opinion of a retailer's brand and 80 percent won't return to a site after having a bad experience.
Online features that ranked high among survey participants included a perpetual shopping cart (rated as an important feature by 74 percent of respondents) and a one-page checkout system (70 percent).
A total of 721 consumers took the 2007 holiday shopping online survey.
The survey was conducted in January by Zoomerang and sponsored by Allurent, a Cambridge, Mass.-based e-commerce company.
Happy Shopping for your Valentine!
BlueNile Goes Global
While Fortunoff went Chap 11 today, online retail giant Blue Nile Inc. announced a global expansion into a dozen international markets.
In addition to the United States, the United Kingdom, Canada and Ireland, Blue Nile now will ship to Australia, Belgium, France, Germany, Hong Kong, Japan, the Netherlands, New Zealand, Singapore, Spain, Switzerland and Taiwan.
The expansion comes as the Seattle-based company experiences rapid growth, even as its brick-and-mortar counterparts struggle to make sales in tough economic times.
In 2007, Blue Nile's international sales increased more than 100 percent, to about $17.2 million.
A Tale Of Two Cities.
Blue Nile Sues Yehuda Diamond.
On-line Diamond Retailer Blue Nile has sued Yehuda Diamond.
The Yehuda Diamond Company sells Clarity Enhancement diamonds. Clarity Enhancement is a process that fills inclusions with special material that results in the inclusion(s) blending in with the facet structure of the stone thereby making it less visible to the eye and rendering the stone eye-clean in the face up position.
Yehuda Diamond in its advertisements compares the price and appearance of its clarity-enhanced diamonds to those natural non-enhanced stones sold by Blue Nile Inc. and maintains that consumers are getting a better deal buying their diamonds rather than non-clarity-enhanced diamonds sold by Blue Nile. Furthermore, Yehuda says that consumers have an absolute right to know how much they stand to save by shopping with them.
In its complaint, Blue Nile acknowledges that “clarity enhancement can improve a diamond’s apparent clarity by one or two grades.” But Blue Nile contends in its complaint that Yehuda Diamonds’ comparisons to its prices are “misleading.”
Not everyone in the Diamond Industry sees clarity enhancement of diamonds in a positive light.
The process does have its critics. Prestigious Diamond Internet Forum, Diamond Review points out the dangers and shortcomings of Clarity Enhancement to consumers here:
Why You Should Stay Away From Clarity Enhanced Diamonds!
We agree and in our opinion Consumers are best served by purchasing diamonds that have not been clarity enhanced and that have been graded by reputable diamond grading labs such as the Gemological Institute of America(GIA) and the American Gemological Society (AGS).
Shopping By Price Online Can Be Frustrating
One of the wonderful things about buying diamonds online is the comfort of being able to price shop and compare one vendor against another with just the click of a mouse. Many vendors offer diamonds at comparable prices. Some are a bit more expensive and some are a bit cheaper.
Shopping by price is of course a major consideration when buying diamonds online. However, it should not be the sole factor in determining where to spend your dollars. Indeed, many vendors will offer price match policies etc. in the event that you find a similar diamond offered elsewhere at a lower price.
More important (or equally important) are the considerations of a vendors published reputation on the Internet, their commitment to customer service, their industry affiliations, their return policies and customer service policies and the level of information provided.
When these variables are considered, there is often a huge disconnect between those vendors who provide real added value to their customers and those who do nothing but blindly drop-ship the diamonds they sell.
Of course, if you can find a vendor who offers the lowest prices together with the most comprehensive level of information and customer service, "you can have your cake and eat it too"!
Frustrated with your price search?
Albert Einstein used to say that "Insanity" is defined as the act of doing the same thing over and over again and expecting different results....
Blue Nile Stock Price Takes A Hit As Sales Decline.
Blue Nile reported a fourth-quarter profit that beat Wall Street's expectations, but a sharp decline in its outlook for the first quarter and full year was described by one analyst as a "real shocker."
Blue Nile, the Internet's largest diamond retailer, says 2008 is off to a disappointing start as consumers pull back on buying top-of-the-line jewelry.
Shares of Blue Nile plunged more than $10 in after-hours trading Tuesday to $43 as the Seattle company warned of "tremendous uncertainty in the luxury retail sector."
"Consumers are holding back," Blue Nile founder Mark Vadon told analysts during a conference call after the close of regular trading. "We're in a very, very transitional time right now, and the market is relatively weak."
Mark Vadon, Blue Nile Chairman
Dan Geiman, who follows Blue Nile as an analyst at McAdams Wright Ragen in Seattle, said the company's outlook surprised him.
"Their last couple of quarters have been perhaps their strongest quarters as a public company, and that was in the midst of a consumer environment that was weakening," Geiman said.
"Now, it appears that they're feeling the pinch. Maybe they're not as immune as some of us thought," Geiman said.
No doubt the Diamond and Jewelry Manufacturers and Wholesalers that are locked in by Blue Nile to exclusive contracts that limit their ability to sell their merchandise in other venues are probably reaching for the Maalox right about now.
Stay tuned.
Pushy $alespeople On The Internet? Say It Ain't So! NO! NO!
One of the things we all loathe when shopping in Department Stores is the pushy salesperson that descends on us within seconds of entering the store and clings to us like a second skin, not letting us browse and breathe and check out the merchandise in a comfortable fashion.
We've all experienced this and I, for one, avoid making eye contact with a salesperson who is in the area of the merchandise I'm looking at, hoping and praying that they DON'T come over.
Radioactive, Stay Away!
One of the pleasures in shopping on the Internet is the peace of mind we enjoy and the absence of being hassled by pushy in-your-face salespeople. This, in spite of the fact that websites do employ sophisticated tracking software to monitor and analyze their traffic, patterns, shopping preferences, and the level of popularity of their website pages and content.
So I was a bit taken aback and surprised when I came across this Consumer's account of his recent Internet shopping experience.
"One major concern that nearly turned me off completely to ...... was the unsolicited phone calls and e-mails. After having previously added an item to my shopping cart, and having entered my contact information without completing the order, I actually began receiving phone calls and e-mails asking me about what ....... could do to help me complete the purchase. My major gripe is that I should be allowed to browse and add items to my cart ANONYMOUSLY and PRIVATELY without concern that I'm going to be chased down just for expressing an interest in an item. I understand the desire to make me a customer, but this is distasteful. Secondly. this was a phone number and e-mail address that I SHARED WITH MY FIANCEE-TO-BE and would have been extremely disappointed to have my surprise proposal spoiled by ....... telling her that I had recently been looking to purchase a ring. I had luckily been able to intercept them, but again, I had to ask customer service to stop these contacts."
What do you Consumers think? Was this Consumer's criticism/anger justified? Or was he fair game for the Internet vendor to contact him since he had already placed products into his Shopping Cart and Checkout Page and the Vendor was just trying to be helpful?
Give us your opinion by choosing one of the options in the Poll, below.
The Future of Buying Your Diamond Engagement Ring On-Line.
The purchase of diamond engagement rings, wedding rings, wedding bands, and jewelery on the Internet has steadily and dramatically increased over the past five years. More and more shoppers are feeling comfortable spending thousands of dollars on-line for an item that is not only expensive but also carries with it considerable emotional and psychological significance.
Our colleague, Ken Gassman over at idexonline.com in an excellent article analyzes the future of on-line diamond rings and jewelery retailing and puts forth some very interesting, thought-provoking, and provocative arguments.
A must read at this link:
Brick & Mortar Stores VS. On-line Shopping
Ebay Sellers ANGRY! at Ebay.
Ebay this week announced two policy changes that has so angered its Sellers that many have staged a boycott.
The policy changes are higher listing fees and most significantly the removal of Seller Feedback comments against Consumers that have placed negative feedback against them.
Ebay sellers believe that their inability to now counter undeserved negative Consumer feedback will put them at the mercy of spiteful consumers who post inaccurate and hurtful comments that will negatively impact their business and reduce their sales. Ebay, on the other hand, believes that Vendor feedback which is negative on an Ebay Customer will chase away consumers and reduce their business.
More here: Angry Ebay Sellers
Diamond Engagement Rings On The Internet: Blue Nile & Tiffany.
CNBC reports that Merrill Lynch analyst Lorraine Maikis has cut her stock ratings for Tiffany and Co. and Blue Nile from "neutral" to "sell."
This revised rating comes amidst an unstable economic environment, where rising food and gas prices, the credit crunch and a weak housing market, and high Platinum and Gold prices are forcing consumers to cut back on big-ticket luxury items such as jewelry.
In addition to Maikis, Oppenheimer analyst Roxanne Meyer downgraded Tiffany from "outperform" to "perform," despite the fact that the company reported strong fourth-quarter financials and raised its 2008 earnings guidance.
Tiffany reported a 7 percent increase in same-store U.S. sales for fiscal year 2007, yet remains "cautious" on the U.S. market, according to the company's latest earnings report. Overall, the company's U.S. retail sales rose 4 percent in 2007, and Tiffany opened three new stores while closing one in Maui, Hawaii, in the fourth quarter.
Blue Nile Sees Diamond Handwriting On The Wall
Forbes yesterday reported that Diane Irvine, CEO of online jeweler Blue Nile (nasdaq: NILE), said at a conference in Chicago on Wednesday that the company is focusing on expansion into the international market, particularly Europe and the Asia-Pacific region. International sales for Blue Nile were up 112.5% to $17.0 million in 2007 over the year prior. "Over the long-term, we believe international will be half or more of our total business," Irvine said.
Shares of Blue Nile were off 0.6%, or 29 cents to close at $43.43 on Wednesday.
Of significant interest and concern is that consumer traffic on Blue Nile's U.S. Web site decreased by 29% in May from the year prior period, according to figures compiled by online traffic research firm comScore.
Blue Nile anticipates that international sales which accounted for 5.0% of 2007 revenue will rise to 9.0% for 2008.
No doubt contributing factors to these significant decreases in USA sales is the current weakness in the U.S. economy and increased competition from other online diamond engagement rings internet websites.
Tough Economy Yielding Blue Profits At Bluenile?
Bluenile is the #1 diamond and jewelery website on the Internet. The stock traded at $80/share last year and the company reported record profits. Today Bluenile's stock price stands at $40/share and they are being impacted by the current difficult economy.
Guys are still getting engaged and buying diamond engagement rings but the the diamonds are smaller and the price tags significantly lower. What effect this will have on Bluenile's bottom line remains to be seen.
More details here: "Blue" Blue Nile
Buying A Diamond Engagement Ring Over A Cell Phone!!
Would you buy this 3 stone emerald cut diamond engagement ring over your cell phone??
Several recent purchases of diamond engagement rings were actually completed over a cellular telephone!
This brings an entirely new meaning to the online diamond shopping experience! Honestly, I cannot imagine that the initial research by these customers was conducted over a 3-4 inch cell phone screen. Probably, they did their homework on a regular computer screen and only consummated the actual purchase over a cell phone (Iphone..I wasn't sure which...).
Either way, I find this to be an incredible indication of where we are going with the Internet revolution!
Broken Engagement? What To Do With That Engagement Ring?
That's assuming she gives it back to you.
We have previously blogged on this topic, providing the names of e-commerce sites that will sell your engagement ring at significantly higher prices than you can get from a retail jeweler.
Bloomberg News this morning reports on this topic and again provides the names of several websites that will broker your engagement ring and obtain higher prices than you can get on your own.
The story is here: Take My Engagement Ring, PLEA$E!!
Diamond E-Tailer Abazias.com Announces Results
Abazias.com reported that its sales fell 17 percent to $1.498 million during the third quarter and a loss of $68,162, an improvement from the company's loss of $309,176 one year ago.
For the first nine months of fiscal 2008, the online diamond jewelry retailer's revenue held flat at $5.139 million, and it reduced its loss by 82 percent to $297,533.
As of September 30, 2008, Abazias had current assets of $661,628 and liabilities of $850,775.
Economic Crunch Pushing Consumers To Pay With Cash, Not Credit.
Are you going to pay with cash or credit?
The Associated Press reports that for more and more consumers in the U.S., who have already maxed out their credit cards or are just trying to manage their spending better in this tough economy, the answer is CASH!
Wal-Mart Stores Inc., Target Corp. and J.C. Penney Co. are noticing a marked shift away from credit cards in favor of cash and debit cards. A big factor is less available credit, as major card issuers cut spending limits and raise fees even for customers who pay their bills on time.
The shift ends the typical consumer's long love affair with credit cards. It is one of the changes in consumer behavior that has emerged since the financial meltdown that will depress consumer spending this holiday season and affect shoppers' habits long afterward.
Particularly during holiday seasons past, shoppers could count on a pile of plastic to give them the extra financing needed to splurge on presents before they had to face the bills in January or later.
But even when the economy recovers and credit loosens up, analysts say Americans -- shaped by what could be a deep and long-lasting recession -- are likely to stick with buying only what they can afford, just as their parents or grandparents did after the Great Depression.
"I think this is a new way of life," said Robert Smith, of Loves Park, Illinois, who along with his wife has been using cash and debit cards to finance their spending, including vacations, since they paid off their credit card debts in July. "I like to be able to know that we paid for something. I hate monthly payments when you use a credit card."
Smith, who has four children ages seven to 13 and owns a motivational training company called Drive and Grow Rich, says his business is down 20 percent this year, and since he is saddled with a mortgage, he doesn't want to get back into debt.
While the credit crunch is teaching consumers to be more "financially prudent," it's creating a lot of pain for both consumers and stores, said Curtis Arnold, founder of CreditRatings.com.
One sign of how strapped consumers are for credit -- and that they are buying only what they have the cash for -- is that for the first time in 17 years, Penney's has seen swings in spending around payday cycles over the past three months.
At Wal-Mart, the volatility in spending around payday -- a drop in spending in the days before, followed by spending bursts right afterward -- has become even more pronounced since September. Chief financial officer (CFO) Tom Schoewe told The Associated Press that
Eduardo Castro-Wright, president and chief executive of Wal-Mart's U.S. division, told investors last month that credit card payments as a percentage of total payments fell 7.4 percent so far in the current fiscal year, which ends in January. That's a big reversal from the robust double-digit growth rates in credit cards over the past three years, he said.
At JCPenney's, Hicks said that use of the company's store credit card was flat during the third quarter. The use of credit cards issued by other parties declined by a couple of percentage points as a percentage of overall payment, he noted, while cash was up by the same amount. Hicks said he hasn't seen a decline in credit card use in five or six years.
But many consumers are using cash or debit cards because they are being forced to. Laura Nishikawa, an analyst at Innovest Strategic Value Advisors Inc., a New York investment research firm, said that based on data from Visa, Master Card and American Express, the number of credit cards that consumers have fell 5 percent in the second quarter from the first quarter. That was mainly because consumers received fewer credit card offers, she said.
For years, consumers tapped into inflated home equity and used credit cards to finance their spending. Now those spigots are being shut off, and job losses are mounting.
"Consumers are really struggling to find sources of cash to make purchases," Hoyt said. "The rapid job losses are taking a big bite out of labor incomes. Obviously, it's making it much more difficult to borrow."
Online jewelry seller Blue Nile, which reported a 23 percent drop in third-quarter profits earlier this month, noted that deteriorating credit has hurt sales of jewelry priced from $5,000 to $25,000.
On-Line Retailers Expect Slow Holiday Sales.
Online retailers are seeing a slow-down in Holiday sales due to the poor economy.
Internet-tracking firm comScore Inc. released results showing that Online spending for the first three weeks of November dropped 4% from the same period last year. comScore predicts that spending for the overall holiday period (November through December) will be flat compared to last year. 2007 saw a 19% sales increase over 2006.
E-tailers such as BlueNile are hoping that "Green" Monday which falls this year on December 15th, that past years has been the biggest on-line shopping day of the season will was again bring out shoppers in droves despite the uncertainty of the current economic situation.
Cyber Monday is Dark Day for Blue Nile, Amazon.com
Cyber Monday, the first shopping Monday after Thanksgiving is typically a bell weather sales day for e-commerce websites. Not so on today's Monday.
Blue Nile shares dropped today almost 13% to $20.82 per share on consumer fears and tightening credit and is down over 65% in price in the past year . In an effort to jump start sales, Blue Nile is discounting many of their listed jewelery items by up to 35% through the end of December.
Amazon.com was down over 5% and tech stocks were slammed down over 9% today.
Retailers are hunkering down for a grim Holiday shopping season.
Luxury Holiday Sales Way Down This Christmas Season.
MasterCard's SpendingPulsereports that luxury retail sales in the U.S. dropped 34.5 percent this holiday season. Total retail sales, excluding automobiles, fell by 8 percent in December through Christmas Eve, compared to last year.
Excluding gasoline sales, the fall in retail sales was 2.5 percent in November and 4 percent in December.
Blue Nile revenues declined by 2.9 percent while Tiffany revenues dropped by with same-store sales declining by 14 percent.
Blue Nile Profits Sink Like A Rock -53%
Blue Nile Inc (NILE) today reported a lower quarterly profit that missed expectations as sales fell, and said the economic downturn prevented it from giving a financial outlook, sending its shares down 10.8 percent in after hours trading.
Blue Nile's net profit fell to $3.5 million, or 24 cents a share, in the fourth quarter ended
Jan. 4, from $7.5 million, or 45 cents a share, a year earlier. Analysts, on average, expected it to earn 34 cents a share, according to Reuters Estimates. Sales at the Seattle-based company fell to $85.8 million from $111.9 million a year earlier.
Other jewelry retailers such as Zale's, Finlay Enterprises, and Tiffany & Co
also took a big hit to holiday revenue, as consumers cut spending on anything that was discretionary.
There is speculation that diamond manufacturers that are currently contractually tied exclusively to Blue Nile thus preventing them from selling their Inventory through other Internet retailers will now look to eventually opt out so that they can diversify and add outlets for their merchandise in order to max sales.
Blue Nile Stock: Buy It Or Sell It?
Is the question that Stock Analyst Zachary Scheidt asks and answers here:
Will Buying Blue Nile Stock Make You Feel Blue?
Diamond E-Tailer Blue Nile 1Q Sales Down.
Diamond E-tailer today announced lower First quarter sales.
Jewelry has been one of the hardest hit segments in the retail landscape as consumers cut out spending on purchases deemed unnecessary or expensive.
First-quarter net profit came to $1.9 million, or 13 cents per share, compared with $2.6 million, or 16 cents per share, a year earlier. Sales slid more than 11 percent to $62.4 million. Earlier this year, Blue Nile said the uncertainty in the economy prevented it from giving a financial outlook.
"Discount" Customers!
Our good friend Barry S. brought this humorous video to our attention.
Anyone running their own business no doubt has encountered this type of customer.
Blue Nile Diamond Pros Going Baby Gear, Maternity.
Darrell Cravens and Mark Vadon, formerly of Blue Nile are shifting their gaze and e-commerce interests to the other end of the age spectrum.
Babies.
They have launched the website Zulily ( pronounced Zoo-lily) a private sale shopping site focused on children’s apparel, baby gear (car seats, strollers, toys), and maternity furnishings.
Private sale just means you have to sign up as a member of the site, and then you get access to special deals, like big discounts on a limited number of brand-name and designer items. The site will have its beta launch sometime in the first quarter of 2010. "We’re really excited to launch a new brand and new company around products for kids,” says Cavens, who most recently worked at Microsoft after spending nearly nine years at Blue Nile.
Zulily has received a $4.6 million Series A funding round led by Maveron, the Seattle venture capital firm founded by Howard Schultz and Dan Levitan. Maveron is known for its investments in consumer and tech businesses like eBay, Drugstore.com, Pinkberry, Shutterfly, and Cranium.
Zulily plans to start out doing one to two sales per day of five to 30 items each. Its revenue model is straightforward retail.
Interesting e-commerce concept; from Diamonds To Diapers...or is it the other way around?
Stay tuned.
Holiday Online Spending Tops 24 Billion
Online sales for the holiday season calculated up to December 18th have increased 4 percent to $24.8 billion, compared with the corresponding days last year, according to the latest report from ComScore.
Most notably, Tuesday, Dec. 15, set an individual-day spending record with $913 million, the first such day to surpass the $900 million threshold.
Blue Nile Stock: Buy, Hold, Or Sell?
Is the question posed this morning by The Wall Street Journal as Blue Nile is scheduled to release their earnings report in the beginning of February. Short selling has significantly increased and Blue Nile management have sold $18 million worth of stock since May 2009.
The full report is here:
Wall Streets Evaluation Of Blue Nile
Touch and Feel Diamond Engagement RingsThrough Your Computer!
What did you say?
Yes, I said it and believe it. This is not a Rod Serling Twilight Zone imagination run amuck, but truly there will come a time in the not too distant future when we will be able to touch and feel diamonds and jewelry from our computer.
Indeed,The Sun this week reported that Hong Kong scientists have developed a robotic hand that allows people talking over the web to experience the sensation of touching each other — even feeling the strength of a handshake.
The cyber hand can grip and shake as well as make the signs for OK and 'V' for victory.
Professor Liu Yunhui, who led researchers from the Chinese University of Hong Kong, said: "At this moment the function is not perfect and it can't copy exactly, partly because the robot hand is different from the human hand in terms of the degree of freedom of movement it has.
"There are also a few errors such as delays in processing and mechanical problems. But in the future it will be possible to produce more sophisticated and more dextrous movements."
Users wear a wrist band which picks up electrical impulses generated by muscles as they contract.
It was originally designed to help the elderly keep in contact with their loved ones in a more personal way.
Prof Liu added: "Although they can show their care through phone calls, physical touch is still a better way to express love.
"The main obstacle we have at the moment is the cost. Our project target was to produce a toy.
It was intended to be low cost and so there were constraints because of the money we could spend. If you want high dexterity it is possible, but you need more motors and you have to spend more money."
The team intends to make progress with future models looking like the human hand — and one day hope to make an entire person which could copy every one of your movements.
