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

MajorsSep 24, 2021
Brilliant Earth Is Now a Public Company

CEO Beth Gerstein said she believes in the jeweler’s omnichannel approach as its retail rollout continues.

Events & AwardsSep 24, 2021
These 3 Companies Will Receive Business Grants from PGI USA

PGI created the program to accelerate the growth of the platinum jewelry market in the U.S.

CollectionsSep 24, 2021
Zales Introduces Elvis Presley Men’s Jewelry Line

From its curb link chains to statement diamond rings, the new collection takes inspiration from the “King of Rock ‘n’ Roll.”

Brought to you by
Bringing Sexy Back: The Allure of COUTURE, Italian Style

Take a tour of Italian designers at COUTURE 2021.

TrendsSep 24, 2021
Piece of the Week: Mateo’s Initial Pendant

It’s a trendy take on personalization.

Weekly QuizSep 23, 2021
This Week's Quiz
Test your knowledge of jewelry news from the week of Sept. 20-24, 2021.
Take the Quiz
CrimeSep 23, 2021
5 Men Who Fenced Stolen Diamonds Get 15 Years in Prison

They bought and resold jewels from a South America-based gang that targeted traveling salespeople across the United States.

SourcingSep 23, 2021
Joanna Hardy Completes Gemstone Trilogy with ‘Sapphire’ Book

It’s the follow-up to “Emerald” and “Ruby.”

Brought to you by
What is your Health Care Coverage Strategy?

Health care coverage is a big expense for small businesses - find out how to lower costs long-term instead of every 12 months.

GradingSep 23, 2021
Another Diamond With Fake GIA Inscription Surfaces

Graders at HRD Antwerp found this one, a HPHT-treated natural diamond inscribed with the report number of an untreated stone.