Blue Nile, Inc is an online retailer of certified diamonds and fine jewelry. The company was established in 1999 out of Seattle, Washington by Mark Vadon. Vadon decided to create the company from his own dissatisfying experience of purchasing an engagement ring. Vadon realized the importance of jewelry, and wanted to create a company that allowed customers to shop with confidence.
Blue Nile, Inc has become one of the largest online diamond retailers in the United States. It currently offers products to 40 countries through three different websites. Since the creation of the company, Blue Nile has experienced an increased sales growth over the years. In 2011, Blue Nile experienced a sales growth of 4.5% to a record of 348 million dollars. New customers had increased by 7% with the belief that this would continue to rise in the coming years. However, Blue Nile faces many challenges in the jewelry industry. They have to compete directly with power chains such as Tiffany and Co, which are well established in the jewelry industry. Although Blue Nile offers online features to customize your rings, many consumers enjoy the satisfaction of being able to physically touch and see a diamond ring before buying one. This is the biggest challenge I feel Blue Nile is currently facing. In order for the company to become a leader in the jewelry industry, management needs to better advertise the company along with the unique tools they provide, such as the online customization feature.
When performing a SWOT Analysis of Blue Nile, Inc you find that the company has an enormous opportunity to become not only the biggest online retailer for diamond jewelry, but a global leader in diamond jewelry sales. Blue Nile has many strengths one of which is pricing power, which allows Blue Nile to control the price of their products. Blue Nile is able to achieve a cost advantage over their rivals by having a lower operating cost, and an efficient economical supply chain. Blue Nile also...