Blue Nile and Diamond Retailing ISCOM370 Introduction Company sales incorporate quite a number of aspects of consideration including logic Setting the selling price and bargaining effectively with the customer is essential in settling at the final price ID: 771346
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Blue Nile and Diamond Retailing ISCOM/370
Introduction Company sales incorporate quite a number of aspects of consideration, including logic Setting the selling price and bargaining effectively with the customer, is essential in settling at the final price. The current presentation, examines Blue Nile and diamond retailing. A discussion is driven on the selling of high-end jewelry and the basis for failures and growth experienced in the companies. The paper determines, the best of the 3 companies best suited to deal with in weak economic times, based on structure. The presentation ends with recommendations to the companies in respect to structures and strategies.
Key success factors in diamond retailing for Blue Nile Offer high-quality diamonds and fine jewellery at outstanding prices Useful guidance, and easy-to-understand jewellery education Explain the four Cs—cut, color , clarity, and carat to the customer Allow customers to build their own ring Low inventory allowing blue Nile to keep lower prices O ffered a 30-day money back guarantee to let the customer’s try the jewellery and trust their purchase
Key success factors in diamond retailing for Zales Offer a credit plan of “a penny down and a dollar a week” Zero delays in bringing in new merchandise Sell the discontinued inventory from failed upscale strategy
Key success factors in diamond retailing for Tiffany The company enjoyed tremendous success with its silver designs Introduced the “Tiffany setting” for solitaire engagement rings Tiffany brand’s association with quality, luxury, and exclusivity
Products categories is better suited to the strengths of the online channel For Tiffany's, more than half the retail sales came from high-end products such as diamond rings and gemstone jewellery with an average sale price in 2007 higher than $ 3,000. 58% of the internet sales came from products worth $200. Hence, it can be concluded that people prefer to buy high value items from brick and mortar stores due to the trust factor. They would want to feel an expensive piece of jewellery before purchasing it. Since Blue Nile was not sure about customers willing to spend thousands of dollars online, it has launched the 30 day money back guarantee scheme. These factors suggest that low prices are suitable for online jewellery sales.
Causes for failure Poor pricing, is a major cause for failure evidenced in the company. Poor supply schedules, such that there were no match between the supply and demand. Poor policies that regulated the market, since the market was operated by cartels who had large market influence. The weak economic conditions in 2008 attributed to the failures, since this resulted to low prices for diamond. The increased competition did outface some of the companies, leading to lower market shareholding.
Company Structure Suitable for weak Economy Blue Nile is the most suitable to operate during weak economic times, given its flexibility. The company is able to offer competitive prices for high quality diamonds. The production arrangement, focuses on manufacturing customized diamond products unlike the rest of the companies. The 30-day money back guarantee business policy, favors the customers, by winning their loyalty and confidence. Aggressive marketing strategies, is suitable for hard economic times, since this will keep the company ahead of the others when the economy weakens
Recommendations The companies should w ork on creating positive image to the customers, so as to win their confidence and loyalty. Price stabilization on all jewelry products for each company, will help improve customer’s trust on quality and quantity. Use of cartels to control the market, will greatly contribute to market stability, while suppliers should be made to well coordinate with the companies on the ground, so as to strike a balance between demand and supply. Companies should greatly participate in corporate social responsibilities so as to improve the welfare of the economy from which they earn from.
Conclusion The use of better pricing strategies is critical for better organization performance. Aggressive marketing strategies, are essential in maintaining a positive public image about the company. Poor pricing greatly contribute to lower performance of the organization. Flexibility in organizations, is essential factor in operations during weak economic times. Customer loyalty is easily won with stable market prices and positive publicity about the company.
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