Blue Nile to open 3 to 4 more stores

FinancialsFeb 06, 2016

Blue Nile to open 3 to 4 more stores

CEO Harvey Kanter said the company’s first standalone brick-and-mortar location is “exceeding expectations” and they plan to get additional stores open in the first half of 2016.

Seattle--If all goes as planned, Blue Nile will have as many as four new “webrooms” halfway into 2016, CEO Harvey Kanter revealed Thursday during the company’s third quarter earnings call.

Kanter said the company’s first standalone brick-and-mortar location, which is in the Roosevelt Field Mall in Garden City, N.Y., is “exceeding expectations” and the company is moving quickly to get three to four more stores open in the first half of 2016. The locations are yet to be determined. 

Opened in June, Blue Nile’s Roosevelt Field store, or “webroom,” is a place where customers can try on--but not buy--jewelry from Blue Nile. All purchasing still happens on the website, though Kanter said most of the transactions are executed in the store. The customers sees a piece they like in the showcase and then buys it on right there using a mobile device.

This is the opposite of what Blue Nile witnessed when it had showcases in two Nordstrom stores in 2013 and 2014. Most customers there made their purchase after they left the store, he said.

Despite the reported success of Blue Nile’s first standalone brick-and-mortar location, Harvey noted during Thursday’s call that having a physical presence remains a small part of the e-tailer’s business.

“We are excited about the opportunity but we must also remind everyone it’s one location and, while meaningful as a lead indicator, is not yet a material part of our business,” he said.

Blue Nile’s announcement of a continued brick-and-mortar push comes as the e-tailer reported low single-digit sales growth in a jewelry market that is, as described by Kanter, “not particularly robust.”

Total sales grew 4 percent year-over-year in the third quarter, from $105.8 million to $110.0 million. Gross profit totaled $21.2 million, or 19.3 percent of sales, up from 17.8 percent of sales in the third quarter 2014.

U.S. engagement ring sales grew 7 percent, from $60.8 million to $65 million. The bulk of the sales came in the e-tailer’s core price points while sales in the $25,000-and-up category remained weak.

Non-engagement sales also were up 7 percent year-over-year.

International sales increased 3 percent on a constant-exchange-rate basis.

Fourth quarter sales are forecast at $158 to $168 million, exceeding the $157.4 million recorded in the fourth quarter 2014, which fell short of company expectations. For the year, Blue Nile said it expects sales to total between $488 and

$498 million, up from the $473.5 million achieved in fiscal year 2014.

Kanter said during Thursday’s call that the company is experimenting with new forms of marketing to generate awareness of its brand.

It’s launched a blog, “Cut & Polish,” and is producing man-on-the-street-type advertorials targeted at millennials as well as using more infographics, video and survey content.

Michelle Graffis the editor-in-chief at National Jeweler, directing the publication’s coverage both online and in print.

The Latest

GradingApr 19, 2021
Here’s What SSEF Found When It Studied High-Quality Afghan Emeralds

The Swiss lab reveals how stones from the Panjshir Valley are both different from and similar to emeralds from other places.

CrimeApr 19, 2021
JSA Issues Refresher on What To Do During a Robbery

The reminder follows a frightening incident at a store in California.

SurveysApr 19, 2021
New Nielsen Study Shows Consumer Optimism Toward Jewelry

The survey showed Americans are becoming more optimistic about their financial futures and view precious jewelry as an important category.

Brought to you by
A New Golden Age

Gold has had its share of ups and downs over the last 5 decades. Here’s why the metal is having another big comeback.

Lab-GrownApr 19, 2021
Lab-Grown Diamond Co. Green Rocks Hires Brand Manager

Ahna Shmuel returns to the company to head brand management as well as oversee the jewelry division.

Weekly QuizApr 16, 2021
This Week's Quiz
Test your knowledge of jewelry news from the week of April 12-16, 2021.
Take the Quiz
WatchesApr 19, 2021
Watchfinder & Co. Names New CEO

Former Rakuten executive Arjen van de Vall will take the reins at the pre-owned watch retailer.

AuctionsApr 16, 2021
Try On This Diamond and Pearl Tiara Before It Heads to Auction

Sotheby’s created an Instagram filter for the crown, estimated to sell for up to $1.5 million.

Brought to you by
4 Reasons You Need This Program for Mother’s Day

Learn how to increase customer loyalty and revenue by making JM™ Care Plan a cornerstone of your business plan.

SurveysApr 16, 2021
March Retail Sales Surge

Another round of stimulus checks helped to bolster last month’s retail sales.