“Stuck in the middle” of the diamond engagement ring market
Vision and Mission “Blue Nile’s vision is to educate its customer base so that customers can make an informed, confident decision no matter what event they are celebrating. It wants to make the entire diamond-buying process easy and hassle-free. In addition, an important part of Blue Nile’s vision as CEO Diane Irvine said in a recent webinar with Kaihan Krippendorf, is for the company to be seen as the “smart” way to buy diamonds, while saving 20%-40% more than one would in the typical jewelry store.” (Hoffman, 2010, p.1).
The objective of the case study of Blue Nile is to evaluate and study their current business strategy. Internal and external analysis are used to identify the weak points or aspects of their current strategy. Other courses of action will be identified to improve the implementation of Blue Nile’s strategy. Alternatives will be recommended to increase the brand name for Blue Nile.
External and Internal Analysis
Porter’s Five Forces Model
Rivalry among Competing Sellers. Rivalry among competing sellers is the strongest among the five sources of Porter’s Model. There are many competitors in today’s diamond market. This makes the rivalry between Blue Nile and its competitor’s high. There are small mom and pop shops, the larger retain stores like Tiffany and Co. and DeBeers. Blue Nile is faced with other online competitors like themselves as well as websites such as EBay and Amazon. The competition is extremely intense to gain customer base. With all the competition each company must be able to offer their customer something they cannot find with any of the others.
Bargaining Power of Buyers. The Bargaining power of the buyer is high in the diamond purchasing world. The bargaining power for the buyer with Blue Nile is medium because customers are able to see the price of their desired purchase and shop around to find a better
References: Wheelen, T., Hunger, J., Hoffman, A., & Bamford, C. (2014). Blue Nile, Inc. Case Study 10. In Strategic Management and Business Policy (14th ed., pp. 10.1-10.16). Boston: Pearson.