Blue Nile braces for a late holiday rush

December 10, 2015 03:59 PM

Love is in the air this holiday season.

“More people get engaged on Christmas than any other time of the year,” says Harvey Kanter, CEO of online jewelry retailer Blue Nile Inc. But when it comes to making a decision on an engagement ring, that token of happily ever after that turns a girlfriend or a boyfriend into a fiance, many consumers  wait until the last possible minute.

“What we see is an inordinate amount of guys waiting till Dec. 20 coming to the site and deciding they’re ready to get engaged on Christmas Eve and Christmas Day,” he says. “We push out one ring per minute on the last day of shipping.” That compares to 300-400 rings per day during most of the year and a daily average of 800-1,000 during the fourth quarter.

Kanter says the company annually adds bench jewelers—he would not say how many—to complement the company’s year-round staff of 50 jewelers to keep up with the increase in demand during the holiday season. The e-retailer also doubles the number of people working in its call center and fulfillment center.

With an average sale of $2,000 on orders overall and $7,000 on engagement rings, Kanter says the retailer has to be meticulous when it comes to creating and fulfilling orders.

“We separate manufacturing and the artisanal element of producing from the (quality assurance),” he says. “Our [quality assurance] team are gemologists inspecting everything about the ring. It’s had multiple inspections by the artisans who are creating these rings. When the ring is actually made and ready to roll, it goes into our QA program. Their purpose is to ensure that the ring going out is the highest quality it can be and it validates our own expectations.”

And it’s not just the rings that have to meet certain standards. Jewelry, particularly engagement rings, are emotional purchases, Kanter says, so it’s important that employees have every detail just right before an order goes out the door.

“We’re not a Wal-Mart, Amazon high-unit-count ship business,” he says. “We concentrate a great deal on the customer experience. Our pick-pack-and-ship business is based on quality. Was the box sealed correctly, are the markings correct?”

Kanter says Blue Nile, No. 85 in the Internet Retailer 2015 Top 500 Guide, says the holiday shopping season is off to a “solid start,” with traffic up year over year. He declined to provide more detail.

In June, the company opened its first physical storefront, a “web room” in a mall on Long Island measuring about 325 square feet. The location allows shoppers to see and feel more than 400 of the company’s products before going online to find the exact style they’re looking for and complete the purchase.

Kanter says the conversion rate of shoppers who visit the web room compared to those who buy directly through Blue Nile’s website without going to the web room is “compelling,” though he wouldn’t specify how much higher that conversion rate is. Blue Nile plans to open three or four web rooms next year.




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