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The growing influence of the millennial generation on diamond jewelry sales has forced retailers to find new strategies and technologies to adapt to the changing way people are shopping. For the most part, retail diamond jewelry sales are still largely conducted face-to-face, with a relationship established between a salesperson and a customer. However, this is changing quickly, and change has necessitated some new tools for both buyer and seller to influence the interaction. In my final series of articles exploring how technology has come to influence our changing industry, let’s take a look at some of the breakthroughs being used in diamond jewelry retailing.
One of the most challenging tasks of any retail store is getting customers into the store. The most brilliant salespeople or breathtaking display cases won’t generate sales without customer traffic into the store. In jewelry, customers tend to be fairly loyal to a particular brand or store, and often buy repeatedly from the same place. Finding new ways to get your existing customers into the store is great strategy for increasing sales without finding new customers, which is one of the biggest challenges for any company.
Customer relationship management (CRM) software has made huge strides in this area, and is helping to automate a time-consuming manual process. Stores can maintain databases on their customers, and software can be tailored to send out reminders of upcoming birthdays or anniversaries, and even suggest different product offerings based on previous purchases. Promotional materials can be sent out around holiday shopping seasons, such as Valentine’s Day in the US, or the massive ‘Singles’ day in China. Although far more labor intensive, text messaging can achieve the same goal with a slightly more personalized touch. Some stores regularly keep in touch with their customers by sending text messages directly to them, and usually this approach has a very high success rate.
Online sales of diamond jewelry have been growing exponentially in recent years. While online jewelry sales are far from eclipsing bricks and mortar, they are becoming an instrumental part of every retailer’s product offering, and tremendous investment is being made to grow this area of retail selling. The two major advantages of online jewelry sales are increased selection and increased customization. Online retailers can offer a virtually limitless choice of styles and diamonds to suit any taste and budget.
One of the principal drawbacks of selling diamonds online has always been that customers for high-ticket items usually want to see and feel the piece, and experience what it will look like on their bodies. Online retailer Blue Nile has tried to solve this problem with a major upgrade to its ‘Dream Box’ app. A user can now take a picture of their own hand, and upload it from a smartphone. They can then see how a ring will actually look on their hand, without having to leave their home. Apple has created a similar app for consumers to see how the Apple watch will look on their own wrists, and many similar applications are available on different platforms. Also, many online jewelry retailers offer high definition, 3D images of their pieces. This allows consumers to see the piece from every possible angle, giving them a better understanding of what they’re buying. It is not uncommon today to see tablets within diamond jewelry stores, which allow the consumer and the salesperson to explore different options for settings or diamonds at the point of sale.
Most of us have been on different websites where we are told the site uses ‘cookies,’ but not everyone understands what these are. A cookie is a small file that is stored on a user’s computer, and that collects a modest amount of data about the user’s viewing history and buying patterns. They are used principally in something called remarketing. Remarketing is why we often continue to see advertisements for a particular product or retailer that we have visited in the past, even when we are looking at completely unrelated websites. These advertisements often follow us around online, and have been shown to significantly effect buying decisions, just by reinforcing a brand or product placement to a consumer, often without them being conscious of it at all. Seeing an advertisement again and again can give someone the impression that the store is perhaps much larger than it actually is, or that many people are buying a particular product. Remarketing is something that retailers pay for based on the number of clicks through the advertisement. This allows them to increase their spending around important shopping periods to drive even more store traffic.
Everyone in retail knows that how you light your store can be extremely important, and can even be a part of a company’s branding efforts. In diamonds, advances in LED lighting have helped retailers to redefine the look and feel of their stores and display cases. LED bulbs, including GE’s Immersion bulb, specifically designed for use in jewelry display cases, increase the visual reflectivity of the diamonds, while reducing electricity costs. The bulbs help by directing peak light to the center of the display case, and radiating light out across the case to eliminate the shadows and hot spots often found with fluorescent and halogen bulbs.
Retail jewelry sales have historically suffered from asymmetric information around diamond pricing. Consumers had little or no knowledge about what the ‘correct’ price of a diamond should be, which is exacerbated by the different standards among grading labs. Although this is still a concern in the industry, and something that still exists, times are changing, and consumers now have more access to diamond pricing information than ever before. I have argued for a very long time that transparency in diamond pricing is critically important for consumers to develop trust in our product. This is one of the driving forces behind my Mercury Diamond Price List™, and why I have made this available for free to anyone in the world. Consumers now have a much better understanding of diamond pricing, which protects their investment and helps them establish a budget before making an informed buying decision.
It’s anyone’s guess what the next technological quantum leap will be in our industry. Today, new machines and software have transformed every facet of the diamond pipeline. With the increasing importance of the millennial generation, technology must continue to advance, in order to capture and enhance this new generation’s love for diamonds. It will certainly be interesting to watch.
The views expressed here are solely those of the author in his private capacity. No one should act upon any opinion or information in this website without consulting a professional qualified adviser.