De Beers and its diamonds are entering cyberspace.
This month, De Beers Diamond Jewelers, the joint venture between South African mining firm De Beers SA and luxury conglomerate LVMH Moët Hennessy Louis Vuitton, is launching e-commerce on its Web site at debeers.com.
E-commerce will be exclusive to the U.S. market and will offer diamond jewelry ranging from a $500 gold pendant detailed with diamonds to a $30,000 engagement ring with a 1.5-carat center stone flanked by two side stones. Prices will climb higher than $30,000 in the future.
The launch comes at a time when luxury goods, namely designer apparel, fine jewelry and handbags, are selling strongly on the Internet on sites such as neimanmarcus.com, Net-a-porter.com and eBay.
The jewelry Web site Bluenile.com has gotten lots of attention and considers itself the largest online retailer of certified diamonds, while smaller Web sites such as Angara.com specialize in novelty diamond jewelry, such as a bib necklace featuring fancy yellow and white diamonds, that climbs well over the $100,000 mark.
Many such sites say engagement rings are top sellers and that consumers can save up to 40 percent shopping online rather than purchasing in a brick-and-mortar store.
De Beers’ site offers no such discount incentive, but rather access to the firm’s branded jewelry in cities where it doesn’t have stores.
The six-year-old brand opened its first store in the U.S. in 2005, on Fifth Avenue in Manhattan. Stores in Beverly Hills and Las Vegas soon followed. Additional units are on deck, including a 1,353-square-foot shop in Houston set to open in August, and a 4,700-square-foot store in San Francisco and a 2,082-square-foot location in Washington, both planned for November. The firm has 14 stores outside the U.S., including locations in London, Paris and Dubai and expects to have 28 to 30 stores internationally by the year’s end. But it’s the middle of the country that chief executive Guy Leymarie anticipates will drive the site’s sales thanks to the brand’s cachet.
“Today, e-commerce is clearly the new route [for selling], including goods like diamonds,” said Leymarie. “It suits a new concept, a new behavior. [We’re] not only [offering] entry prices, but also the very high end.”
While competitors like Tiffany & Co. and Cartier have extensive Web sites where consumers can view anything from watches to jewelry, diamond engagement rings are only sold in-store. Cartier doesn’t sell online, but Tiffany does.
Leymarie said the firm started its e-commerce effort with the U.S. because the country consumes the most diamonds of any other place on the planet.
De Beers’ designer collections, Talisman and Radiance, will also be sold on the site, in addition to classic styles like tennis bracelets and studs.
“The products that we put on the site are what we consider products that are easy to buy,” he added. “For more complex stones or pieces that require more explanation, we’ll invite [consumers] to the store for a more complete retail experience so they can benefit from the knowledge of our staff.”
All diamonds on the site include De Beers Passport, guaranteeing the provenance of the diamond.
Leymarie declined to give sales projections for the e-commerce business, but said branding is key to the initiative.
“When you think diamonds, you think of De Beers,” he said. “Our heritage is not denied. We have a brand name with a very high level of awareness.”
Some industry watchers said offering its goods online could take brand awareness to an even higher level.
“Obviously, e-commerce has exploded in a variety of different areas. Some had strong fits and starts,” said Andrew Jassin, managing director of Jassin & O’Rourke Group, a New York industry consulting firm. “Being that De Beers is a cornerstone of the diamond business and the luxury business, there’s a possibility that they may be more successful than others. [However], the fact is that most customers accustomed to buying luxury jewelry purchases need to feel [the products] and see them to complete the purchase. To a large degree, De Beers in this country is not so well-known. The Web-based business can improve the knowledge of who De Beers is.”
Arnold Aronson, managing director of retail strategies at Kurt Salmon Associates, said by democratizing diamond engagement rings via selling online, De Beers has the opportunity to grow its business significantly.
The company has been trying to expand so that it is not only known for diamond stud earrings and engagement rings, but as a diamond jewelry house. Hollywood jeweler Neil Lane designs a collection for the firm and British jeweler Stephen Webster, who is known for his sense of rock ‘n’ roll and bedecking Madonna in his Gothic-inspired pieces, has just signed on to do a men’s line.
In October, De Beers is slated to introduce a watch line in conjunction with a Swiss manufacturer. The watches will be within the Talisman collection, which focuses on rough, uncut diamonds.