Blue Nile’s chief govt officer Sean Kell is steering the corporate’s ship at a time when jewellery e-commerce is seeing important progress. With this new wind in its sails, Blue Nile — which claims it’s the greatest on-line retailer of licensed diamonds and positive jewellery on the earth — is now angling for $1 billion in annual income, a objective that Kell is satisfied the corporate can meet inside two to 5 years.
“We really think we are trying to be a billion-dollar fine jewelry destination. The shift is trying to make a company that started as an engagement ring website transition to a billion-dollar fine jewelry brand and that is the big change — that’s the long-term goal,” mentioned the manager, who has additionally held senior administration roles at Expedia and Starbucks.
The Seattle-based firm is on observe to hit $600 million in income for 2021 and is rising within the mid-20 % vary annually — a substantial soar that has solely been helped by the pandemic’s digital buying local weather. Blue Nile was delisted from the inventory market in 2017 with a $500 million buyout from Bain Capital — at which level the corporate was clocking round $500 million in annual revenues.
In order to additional speed up progress, Kell has plotted a holistic twofold overhaul of Blue Nile’s operations, with the goal of drawing in new buyers whereas retaining its core clientele. Scaling at this charge will entail a substantial doubling-down on product design; a redesign of the corporate’s web site; a revision of its branding and advertising plans; a substantial roll out of recent bodily retail areas; a strategic enlargement in world markets, and maintaining with necessary social actions like sustainability and transparency.
To pull all of it off, Kell has introduced on board a brand new group of C-suite executives. Jason Moss has joined as chief working officer from Amazon Web Services, the place he was a director; Ben Abitol is the brand new senior vice chairman of provide chain, having joined from Timex, the place he ran the corporate’s provide chain; Dominique Bourgault is the brand new chief monetary officer, becoming a member of from Expedia, the place she was the CFO of retail enterprise models, and Anita Natarajan is Blue Nile’s new SVP of worldwide enterprise, becoming a member of from Uber, the place she was common supervisor of world airports.
Kell himself had prior expertise on the earth of e-commerce, however not throughout the jewellery sector. “It’s been a lot with a new industry and then throwing the pandemic on top of it. It’s hard to imagine a year when I have learned more or experienced more change. I have never worked in jewelry, but I’ve been a longtime jewelry consumer — a power consumer, if you will. My mom and dad loved jewelry and loved gifting jewelry to my mom so I grew up with jewelry boxes around the house and my wife is an artist and loves creative things and jewelry as well,” he mentioned of the leap into a brand new class.
Blue Nile’s Spring Collection
Courtesy of Blue Nile
“The [jewelry] global supply chain is quite different from other industries for sure. The other big difference for me was the branding and lack of branding at the same time in jewelry. There are amazing brands in jewelry like Tiffany, Cartier but the product itself isn’t generally branded — there is no logo on a diamond. Some brands create iconic designs but the branding has generally been around the retail experience and not the product itself, which is different from many other industries like travel, auto and banking, where the whole experience is branded,” he famous of his observations of the jewellery retail market.
During the pandemic, customers’ well-documented shift towards buying on-line was of explicit assist to firms like Blue Nile. The jewellery class had seen a notably sluggish adoption charge of customers keen to shift their spending on-line — notably with higher-ticket gadgets like positive jewellery and engagement rings. But when world lockdowns hit, Kell mentioned: “Consumers discovered en masse, it had been there a little bit, but that you can buy great jewelry online and find a great assortment and great prices — it’s awfully convenient.”
“At Blue Nile, we generally ship our jewelry overnight. If you shop today, you will have it tomorrow. That’s the number-one massive discovery for our shoppers,” he added.
The govt mentioned engagement ring spending has picked again up from its early pandemic days low. Additionally, the sale of “Zoom jewelry” — resembling earrings and pendants worn to catch on-screen consideration — have additional bolstered the corporate’s numbers throughout this time. “Diamond earrings have been an amazing growth story for us, we’ve seen people buying them for self-gifting and occasion gifting. We have see it in Europe and Asia as well which haven’t traditionally been diamond earring markets,” Kell mentioned.
Blue Nile’s direct-to-consumer mannequin and excessive quantity have allowed the corporate to maintain its diamond costs decrease than many opponents and appeal to value-driven customers. But through the pandemic, Blue Nile noticed buyers buy items of a usually greater worth — with the positioning seeing its common buy worth soar by between 10 and 20 %. This has impressed Kell to push Blue Nile’s assortment “upward.”
“We are definitely seeing consumers buy more expensive items in fine jewelry. So in our diamond jewelry we are adding to our assortment and trying to walk up the quality scale. While we still have great everyday prices and smaller [diamond] sizes, we are adding that quality and assortment at a higher price point. Consumers have really reacted well,” he mentioned.
De Beers’ Ten/ten assortment by unbiased jewellery designers.
Courtesy/De Beers
In January, Blue Nile launched Ten/ten — a line of fashion-forward engagement rings created by unbiased designers in collaboration with De Beers. Pieces by cult indie designers like Wwake and Bea Bongiasca obtained an “amazing reaction,” in accordance with Kell.
This success impressed him to push for extra fashion-forward product in Blue Nile’s assortment that may assist swing the corporate’s profile extra upscale.
In a perfect world, the positioning will function trendier kinds like these within the Ten/ten assortment, balanced with the sort of industrial items it at present options. An enlargement of the corporate’s engagement ring providing will come later this yr, that includes coloured stones and an expanded customized design expertise.
“We have consumers that are relatively affluent jewelry lovers that we can help find some amazing designers that they would not find otherwise. We want to be friendly to these designers. So you’ll see us both with conservative kind of product that’s less fashion-forward and then also see us really pushing into incredibly fun, fashion-forward jewelry as well with external designers. We will have some of our own internal designs as well,” Kell mentioned.
One product that didn’t carry out as anticipated this yr is Blue Nile’s tie-up with Lightbox, the lab-grown diamond subsidiary owned by De Beers. “We honestly thought it would sell much more with the combination of a lower price point and some messaging around what lab stones are, that it would resonate. I was surprised — they sold well, but I thought they would sell really well,” Kell mentioned.
He chalked it as much as how Blue Nile’s client base is dedicated to the romantic notion of pure stones. “Our consumers just haven’t really embraced that product. You can come to our site and look at the difference between a one carat lab-grown stone and a natural diamond and consumers are favoring to pay extra for the natural stones. They are not giving up on it. But I think the lab-grown stones are a good proposition and a great product — so we are not giving up on it,” he mentioned.
In the subsequent 5 years, Kell has plans to open at the very least 50 Blue Nile bodily retail areas throughout the U.S. The shops are just like different d-to-c retail ideas, by which places perform extra like showrooms — purchasers can strive on product samples, however the retailer doesn’t maintain stock. Rather than package deal product within the retailer, gross sales associates assist buyers make an informed choice after which full a purchase order by the corporate’s web site — which is overnighted to buyers’ houses.
Kell has employed Jennifer Licata, previously of Louis Vuitton, Marc Jacobs and Moncler, to guide the cost in Blue Nile’s new retail rollout as the corporate’s vice chairman of shops. Currently Blue Nile operates 12 models in cities together with Philadelphia, Portland, Newport Beach and Austin with plans to function 18 by the tip of this yr. Licata’s work may also lay the blueprint for Blue Nile shops in key worldwide markets, together with China.
Blue Nile’s Century City showroom boutique
Courtesy of Blue Nile
Sustainability can be excessive on the corporate’s agenda. Kell has spearheaded the design of recent sustainable Blue Nile packaging that may roll out by the vacations this yr. He can be seeking to take a web page from Tiffany & Co.’s ebook and implement larger traceability to the uncooked supplies that Blue Nile makes use of for its jewellery.
“We only source 100 percent conflict-free stones that are supported by the Kimberly process. As we work with suppliers and miners we understand that we are really there to support the most environmentally sustainable practices in the procurement of diamonds, gemstones and metal,” he mentioned of the corporate’s present requirements.
With a worldwide nudge for jewellery to have larger sustainability and traceability, Kell mentioned Blue Nile has to work on “a traceability effort. It’s a tough one — it’s conceptually not that hard but tracing a piece of jewelry and diamond from the earth to a setting can be very complicated. We are working on it and watching what Tiffany & Co. does. De Beers has projects under way that we are dabbling in trying to understand what they are.”
But with a purpose to stake a bigger declare within the world jewellery market, Kell realizes that Blue Nile’s predominant interface — its web site — is in want of an overhaul. The firm’s e-commerce web site, visuals and emblem are set for a zippy replace to extend public curiosity. “The site is seeing a bit of an evolution — not a revolution — and we have been looking hard at the brand as well. We will not be changing the name of the company but we have been taking a hard look at the iconography. If you see the photography and imagery on the site now versus a year ago it’s pretty dramatic — more luxurious and aspirational,” he mentioned.
This overhaul will likely be utilized to Blue Nile’s enterprise within the U.S. in addition to overseas, with worldwide enterprise at present representing about 20 % of firm gross sales — half of which come from China. Blue Nile at present ships to 45 international locations.
The Chinese market is a key focus for Blue Nile underneath Kell’s administration. Currently, he mentioned Blue Nile is the second greatest U.S.-based diamond distributor in China behind Tiffany. There, Blue Nile is marketed as a Western jeweler with a give attention to engagement rings, that are a quickly rising custom for younger {couples} throughout the area.
“It’s really fun, the Chinese consumer base is very exciting and incredibly energetic and just I think there’s this kind of effervescent bubbling within consumers there. They love jewelry, the social platforms there are so big and so incredible — there’s new ones it seems everyday and our team does a great job to provide great service to consumers,” Kell mentioned of the corporate’s response in China.
Now he’s in search of the corporate to refine its place out there there with a localized “customer assortment and messaging and advertising. We have been investing in WeChat and JD.com and RED in China — Tmall, of course. And we are further investing in our relationships with key opinion leaders across social platforms there,” he mentioned.
Most of Blue Nile’s engagement rings are set close to the corporate’s headquarters in Seattle. Other merchandise meant for U.S. customers are held there as properly, whereas product for Europe is shipped out of Ireland and product destined for Asian markets is drop shipped out of Shanghai. The firm manufactures its product throughout a community of suppliers in nations together with the U.S., India, Thailand and China.
As Blue Nile continues on its progress trajectory, Kell mentioned these distribution facilities “will need to expand. We’ve already expanded our operations in Seattle a few times as we have grown. We will be expanding into a new, bigger office in Shanghai. And we are looking at growth in Ireland as our European business comes back after lockdown. We think those are the right three locations for us now but as we grow we will be looking at new options as well,” he mentioned.
But for Kell, the largest payoff is buying and selling in a retail class that brings folks — particularly his buddies — a little bit of sparkle and happiness. “A good friend texted me late last night and said, ‘Sean, my 15th wedding anniversary is tomorrow — can you help me?’ I said, ‘Hey, you’re cutting it a little close but of course.’ It’s really fun to be in a company, an industry that makes beautiful things that consumers love. We get to be part of helping people celebrate moments and occasions. It’s busy for sure, but it doesn’t feel too busy — it feels fun busy,” he mentioned.
