Blue Nile — self-proclaimed “man’s best friend” — has taken it up a notch …
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Business Week: How Four Rookie CEOs Handled the Great Recession – DIAMONDS ARE FOREVER, February 18, 2010
Diane M. Irvine had no time to celebrate getting the chief executive job at online jewelry retailer Blue Nile. Hours after her appointment in February 2008 she had to tell investors that sales from the previous holiday season had been worse than expected—and the credit crunch would probably mean a dreadful next year.
Blue Nile was selling luxury goods in what was probably the worst economy in 75 years, Adding to the challenge of waning consumer demand were diamond prices, which remained at boom-year levels.
Irvine had to come up with a plan, and fast.
She surprised many by using the recession as an excuse to go on the offensive and gain market share.
Blue Nile had an edge on brick-and-mortar jewelry brands like Tiffany’s and Zales in a downturn because it required little overhead and virtually no inventory.
Competitors would struggle and close stores; Blue Nile would invest and expand.
Irvine doubled down on technology that would help bring in new customers. Blue Nile’s site underwent a year-long revamp, adding new tools to help buyers search for diamonds by budget, shape, and quality.
The new CEO also pushed into overseas markets, tweaking the Web site to accept 23 different forms of currency.
Credit was a barrier to many potential sales. So the Seattle company joined up with Bill Me Later (the company eBay would later acquire) to offer customers no-interest financing for six months on large purchases.
Irvine’s offensive is beginning to pay off. Fourth-quarter revenues increased, by 20%.
Meanwhile, three of the top traditional jewelry retailers have filed for bankruptcy, and competitor Zale appears poised for a major restructuring.
Full article:
http://www.businessweek.com/magazine/content/10_09/b4168032766715.htm?campaign_id=magazine_related
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