Focus on

THE DIAMOND INDUSTRY

AS ONLINE SALES PLATFORMS GAIN IN POPULARITY,
RETAIL
REMAINS THE HARDEST NUT TO CRACK

 

Winston Churchill was once famously quoted as declaring that one should never waste a good crisis. It is a pearl of wisdom that has been repeated countless times during the current COVID-19 epidemic, as it becomes clear that the many of adaptative measures that individuals and companies are taking to cope with the quarantines and lockdowns are sometimes showing themselves to be more effective that the methods used way back before the current situation started, about four months ago.

With many members of staff, suppliers and customers operating from home, essentially three types of technological solutions have been sought out by members of the jewelry and gemstones trades. The first includes remote systems of management, by which administrators can handle finance, commercial transactions, personnel and logistics from their computers or cell phones. The second is communications systems, replacing the previously considered essential face-to-face meetings and public gatherings with video conferencing and webinars. The third involves digital platforms on which goods can be displayed and transactions finalized.

Many of these systems were already in place before the crisis hit, and had been incorporated to one degree or another by a growing number of companies. But they clearly are more easily used by firms operating at specific stages of the chain of supply rather than at others.

The diamond industry’s midstream, for example, is relative well catered to as far as sales platforms are concerned. Stones can be displayed online, their gemological characteristics verified by laboratories and optically examined close up, allowing a professional buyer to make a reasoned decision and complete the transaction.

But at the retail end, the situation is more complicated. While there are B2C websites selling successfully, diamond jewelry buying is generally an emotional experience that is often associated with an important life event, where the actual act of selecting, trying on and buying the product is part of the total experience. The current inability of retailers to fully duplicate this process online is possibly the greatest obstacle being faced by the business during periods of lockdown.

WHERE THE EXPERIENCE OF SHOPPING IS KEY

In many respects, retail has shifted to an experiential model, whereby store functionality –which refers to the basic act of locating, selecting and buying the product –  takes second place to the experience that the customer goes through from the moment he or she has engaged with the business, which is then reinforced by the experience of owning the product. This is a successful model that has been long developed in the non-jewelry environment, by companies like Nike. It requires a great deal of creativity and imagination, but with the growing influence of e-commerce considerably less of an investment in expensive real estate.

Simply stated, e-commerce operations do not require exclusive street frontage or shopping mall locations. Consequently, the demand for warehouse space has for years being growing at double the rate that of store space. Furthermore, online reviewing and free shipping/returns has considerably reduced the need for product testing in brick and mortar stores.

Simply stated, e-commerce operations do not require exclusive street frontage or shopping mall locations. Consequently, the demand for warehouse space has for years being growing at double the rate that of store space. Furthermore, online reviewing and free shipping/returns has considerably reduced the need for product testing in brick and mortar stores.

Retail is shifting to an experiential model, whereby store functionality takes second place to the experience that the customer goes through from the moment he or she has engaged with the business.

But for high-ticket items, like diamond jewelry, it’s not simply enough to display the product and provide the means of buying it. More often than not the customer goes on a journey with the sales representative, who helps build up confidence before making a choice. A good salesperson will his or her approach to the specifics of the customer they are dealing with. The question is, is it possible to create this type of dynamic in an e-commerce setting?

E-COMMERCE WITH A PERSONAL TOUCH

In a now classic digital environment, the customer’s experience is created by content, visual, audial and textual. But a newer system employing artificial intelligence and big data to personalize the experience for the user, showing the types of products that they are more likely to prefer and tailoring the messaging so that it speaks to the specific individual.

System that are able to analyze the user, based on data that has been collected, and then catalog the jewelry items they are more likely to appeal, making the task of sifting through online inventories less tedious and more exciting. Providing information about each in an attractive, easily comprehendible and engaging manner is also important.

With the rapid strides being made in video-conferencing, it is likely possible that the online clients be provided the opportunity of building a relationship with a non-virtual sale-representative.

With the rapid strides being made in video-conferencing, it is likely possible that the online clients be provided the opportunity of building a relationship with a non-virtual sale-representative. There are already a number of live-chat modules available, with the e-commerce website EcommercePlatforms recently reporting that live chat APP solutions have the highest satisfaction level for any customer service channel, with a 73 percent approval rating.

As it is, for many jewelry consumers, the standard experience of buying jewelry deserves an upgrade. Buyers have long complained about being treated like potential thieves, noting that, while security concerns are understandable, the attitude is not always conducive to turning the act of buying jewelry into a happy memory. Well designed, intuitive and reactive e-commerce platforms may be able to do better.