Blue Nile is collaborating with Royal Asscher to offer diamonds curated by the Dutch house as part of the Signet Jewelers-owned e-tailer’s repositioning as a high-end brand.
The deal sees Blue Nile become Royal Asscher’s exclusive licensed retailer in North America, Signet said Tuesday. It will be the only retailer to offer an assortment of diamonds that the Asscher family curated. The products are already available on Blue Nile’s website. Consumers visiting the page see a toggle enabling them to browse these specific stones.
In addition, Blue Nile will be the exclusive retailer of Royal Asscher’s SIX collection of jewelry built around the Amsterdam-based company’s six patented diamond cuts. It will also be the exclusive North American retailer of Royal Asscher’s six patented diamond cuts: the Royal Asscher cut as well as its own versions of oval, brilliant, cushion, pear and emerald.
The move comes in the context of Blue Nile’s efforts to become a higher-end diamond house itself. The business has shifted its focus to natural diamonds, has acquired The Clear Cut to gain a white-glove concierge service for customers, and is turning its physical showrooms into retail stores with inventory and point-of-sale capabilities.
Signet chief operating and financial officer Joan Hilson and Blue Nile president Pam Cloud spoke with Rapaport News on Tuesday to outline the importance of these developments and present their outlook for Blue Nile. They also explained how they see the diamond market right now.
This interview has been edited for length and clarity.
Please give me your perspective on the Royal Asscher update.
Joan Hilson: It’s part of Signet’s “Grow Brand Love” strategy. We’re elevating the positioning of Blue Nile, and we’re investing in it as a luxury brand within our portfolio and [making it] more aspirational within the jewelry retail space. We’re creating a differentiated luxury experience around exceptional diamonds and thoughtful curation. And that’s where the exclusive partnership with Royal Asscher is very important to us. We also acquired The Clear Cut a few months back, which is a white-glove concierge service. We’ve recruited Pam Cloud to lead the Blue Nile brand, who has a deep, broad experience in the luxury jewelry retail space…. We have this wonderful partnership with Royal Asscher, with the exceptional diamonds as well as the SIX collection, which is the Royal Asscher patented cuts, and they’re our exclusive partner in North America. We’re very excited about the growth potential. We have product, we have great leadership, and we have a concierge service to drive the Blue Nile business.
Have Signet or Blue Nile had an association with Royal Asscher until now? Have you worked with the brand before?
Hilson: We have in the past on a limited basis. As we came together over the last several months and worked through the new positioning of Blue Nile and elevating it and focusing it on the enduring value of natural diamonds, we felt that this was the exact right time to enter into this partnership and bring the six patented cuts to our customers as well as the curated collection of exceptional diamonds curated by the Asscher family. [This] was the right time for us to come together with the brand positioning and the credibility, the trust and the legacy that Royal Asscher brings.
How are you bringing Blue Nile more upmarket, other than this particular example?
Hilson: We’ve focused on three pillars. One is a focus on natural – not exclusive[ly], but [led by] natural diamond[s]. Underneath that we are delivering new product assortments and Royal Asscher is a piece of that strategy. We believe that will help us with their heritage, legacy, and the patented cuts that will elevate the overall brand, as well as with the Asscher-curated diamonds. Secondly, we are introducing a white-glove service with the acquisition of The Clear Cut, and we’re in the process of integration there. And [the third pillar], our store experience, is another focus for us. We’ll be offering fine jewelry and diamonds in-store and ready for purchase for the customer, rather than just a showroom. So, you’ll see us converting from showroom to store over the next year or so. And for the first time, we’ll have product in-store for the customers to purchase.
Is the number of showrooms going to increase from the current level of 23?
Hilson: Over time, we would expect that. We also think there’s a potential international expansion because of the strength of the Blue Nile name. We have international business over the last several years that now with the refocus and the enhancements to the website, we…believe we should be able to grow in that way as well.
Online brands are now going back and actually selling product in-store. Why do you think that’s happening?
Hilson: Within the overall Signet portfolio, 80% of the business is done in-store, because the customer wants to have the experience to touch and feel. Remember that overall Signet is a 50% bridal business, so it’s a moment that’s very important and emotional to the customer. So when you think about a digital-first business that Blue Nile launched as, [showrooms were] used as an educational aspect. We see that the customer likes to engage with an expert in-store as well as virtually. We have also heard from our customers that having product available in-store is very important to them. We’ve seen that the digital-first customer…is very comfortable closing and doing their own search and maybe talking to a virtual jewelry consultant online, but [we’re] hearing more so a preference to be able to talk to a jewelry consultant live in person and have the jewelry available to them. We see that as a trend. There’s a significant portion of the business that’s generated out of those 23 showrooms. And so continuing to evolve the showroom into a store and potentially expanding the store footprint is a growth opportunity for us.
You said that people like the physical experience of seeing a diamond in person. Would you say that’s more the case for natural than for lab-grown?
Hilson: I don’t have data on that. What I will say is that for the higher price points above $5,000 in the engagement business, 90% of those transactions are natural.
And for a higher price point, consumers are more likely to want to see the diamond in person?
Hilson: Yes.
Can you give me an update on how the integration of The Clear Cut is working?
Hilson: It’s a technology integration that we’ve been working [on] with the teams. We would expect that the full integration would occur next year, and Pam is working very closely with Olivia Landau, who is a natural-diamond expert and has a social-media presence, to really convey the sentiment and the enduring value of natural diamonds. So that’s well underway and [we’re] working towards that.
Pam Cloud: We know so many customers want that bespoke high-touch experience, and so as customers come into our stores or interact with us online, then we have The Clear Cut as a resource to actually use them to help with that sale.
If I go into a Blue Nile showroom or onto the Blue Nile website, how do I get access to this white-glove service? How would I know about it?
Cloud: We just had a training in New York with all of our showroom heads and our customer-service diamond team and set that in motion, so that when a sales professional was reaching a “no” at the case, meaning it was a customer request that was highly bespoke, they wanted true custom design, they wanted to talk to a gemologist, they wanted to talk to an expert like Olivia – up until this acquisition, there wasn’t an easy way to do that. And so we had everyone in from the showrooms to train them on the handoff, so that to the customer, it’s rather seamless. The sales professional then retains the relationship with the client, but is working with Olivia and her team of gemologists to actually procure the stone, complete the design, and together we’re able to meet the customer’s needs.
How many gemologists did you bring over from The Clear Cut in addition to Olivia?
Hilson: They had anywhere from five to eight gemologists, so it was a smaller team that work [together] very closely…to serve the customer.
So it will be them plus existing Signet or Blue Nile people?
Hilson: The intention is that Olivia and Kyle Simon will train the Blue Nile consultants to work with the customers, leveraging their technology.
Can you estimate what percentage of your current sales and inventory of Blue Nile are lab-grown diamonds?
Hilson: We haven’t shared that. But the focus is to continue to drive the natural-diamond business. Particularly at higher price points – [and] overall there’s a trend to higher price points – we see the customer purchasing natural. So that’s the focus of the Royal Asscher partnership as well as the acquisition of The Clear Cut.
Cloud: And we have two new collections on the site, Modern Pavé and Ellipse, and those are also natural diamonds. So it’s a focus across the brand.
Hilson: Engagement and fine jewelry is a focus for natural.
How are you seeing the natural-diamond market at the moment? Are you seeing an improvement in sales?
Hilson: We see the market as stable. It’s been a little bit up and down over the past years. And so we see the natural-diamond market as stable and we see higher price points trending, higher carat weights trending up. That’s consistent with what we’re seeing happen in our business in terms of higher-price-point sales. So we feel very good about the natural-diamond market.
Image: Blue Nile jewelry with Royal Asscher diamonds. (Blue Nile)
