Blue Nile Creating Physical Presence

(IDEX Online) – Online diamond and jewelry company Blue Nile has linked up with two Nordstrom stores to give potential buyers the opportunity to look at goods before placing an order online.

Diamond rings on show at Nordstrom's Seattle store cannot be bought, but shoppers can try them on and inspect them up close. Shoppers must go to Blue Nile's website to carry out the purchase.

The experiment with enabling visitors to see the goods at bricks-and-mortar stores is an ironic departure for online jeweler which has been selling online for the past 15 years.

The experiment, which only extends to Nordstrom's Seattle and a New York City store, aims to to attract new customers to the e-tailer's site, with analysts saying it comes in response to the establishment of websites by most U.S. national jewelry chains. The chains therefore have both a physical and an online presence leaving Internet retailers such as Blue Nile without the ability to physically present goods.

"Now everyone [else] is online," said Morningstar analyst Paul Swinand, "what they do is less unique."

Analysts believe the company needs to more to build its brand in the United States and more effectively compete with big national jewelry chains and competitors such as Amazon.com.

Blue Nile enables shoppers to research diamonds and customize jewelry online, and due to its low overheads can offer prices that are 20-40 percent below store-sold diamond prices.

The e-tailer's net income last year was $10.9 million, far less than that of Signet's $368 million.