Blue Nile Case Study

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Blue Nile Case Analysis

Founded in 1999, Blue Nile has grown to become the largest online retailer of certified diamonds and fine jewelry. At Blue Nile you'll find high-quality diamonds certified by the most respected independent diamond grading labs. You can create your own jewelry were you choose the diamond and they will set it in your favorite earring, pendant, or ring design. Every order is shipped free, guaranteed and returnable within 30 days, so you can be sure you made the right decision. With sales of $251.6 million in 2006 compared to $169.2 million in 2004, Blue Nile is larger than the next three largest online jewelers combined. Blue Nile was the only jeweler to have ever received the Circle of Excellence Platinum Award which recognized them the best in customer service ranked by actual customers.

With such a large and competitive industry Blue Nile is able to limit costs while offering high quality stones along with providing detailed product information. Some issues with Blue Nile that could use some improvement is with their marketing efforts, stock options and there expenditures into international markets. Strategic Issues and Problems

Blue Nile’s strategy to attract customers had two core elements. The first was offering high-quality diamonds and fine jewelry at competitively attractive prices. The second entailed providing jewelry shoppers with a host of useful information and trusted guidance throughout their purchasing process. Blue Nile’s merchandise consist mainly on offering high quality stones in terms of shape, cut, color, clarity, and carat weight. Besides finished products Blue Nile offers a build your own feature that allows customers to customize diamond rings, pendants, and earrings. Customers could select a diamond and then choose from a variety of ring, earring and pendant setting that were designed to match the characteristics of each individual diamond.

Another strategy of Blue Nile was their...
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