What do you think of the fact that Blue Nile carries more than 30,000 stones priced at

$2,500 or higher while almost 60 percent of the products sold from the Tiffany Web site are

priced at around $200? Which of the two product categories is better suited to the

strengths of the online channel?

When it comes to Blue Nile they carry 30,000 stones priced at $2,500 or higher. They have

competitive edge as compared other retail outlets as they offer a large variety of high-quality

diamonds at one place giving their customers choice. They are able to provide their products at

lower profit margins because of low warehouse and inventory cost. Also, their target market is

the one who desires customized jewelry with high value and they are willing to wait for their

order. Plus, to maintain loyalty of their customers, they offer 30-day money back guarantee.

When it comes to their supply chain, it’s very efficient supplying products only in 3 days from

supplier to retailer.

Whereas when it comes to Tiffany, they only sell non-gemstone, sterling silver jewelry online

whereas they tend to keep their exclusive and diamond jewelry limited to their retail outlets only

which is the reason why the price of Tiffany’s products are priced lowered online. Their online

sales contribute to 58% of total sales.

The brand strategy of both these companies is totally different, Blue Nile focuses more on

availability, variety and accessibility whereas Tiffany is an exclusive brand limiting the sales of

their diamonds only to their retail outlets whereas selling only category D jewelry online.

Tiffany’s strategy is more suited to strengthen online sales as the economic condition is

uncertain. Customer at time demands cheaper jewelry. So when there might be economic
recession, people still might opt for Tiffany. Whereas Blue Nile has more competition with

wholesalers.