Majors
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De Beers expands reach in top U.S. markets,
July 01, 2007
De Beers expands reach in top U.S. markets, online
By Susan Thea Posnock
New York—If the future of jewelry retail lies in bricks and clicks, then De Beers Diamond Jewellers is covered, with stakes claimed in both.
The luxury diamond jeweler expects to open three more U.S. stores this year—which would bring the total to six boutiques here by year's end—and it launched e-commerce on its Web site, De Beers.com, in early June.
The retailer, a joint venture of De Beers and luxury company LVMH Moët Hennessy Louis Vuitton, opened flagship stores in New York and Los Angeles in 2005, then opened a third outlet in Las Vegas earlier this year. A Houston store is set to open the middle of August, with stores in San Francisco and Washington, D.C., slated for November.
Given the retailer's early success, Chief Executive Officer Guy Leymarie says De Beers is eyeing opportunities in other top U.S. markets.
"What we're looking at is clearly to have over the coming years a De Beers store in the prime markets in the major cities in the U.S.," he says.
Other possible locations—if the retailer can secure the right retail space—include Atlanta, Boston, Chicago, Dallas and Philadelphia. While none are set in stone, Leymarie notes that the company will not hesitate to jump on a prime location in a major city.
"This market is obviously highly competitive, and we'll try to challenge this competition and to be a player," he says.
He points out that the establishment of a De Beers retail outlet in the United States was special because of its brand recognition. However, he believes some jewelers misinterpreted what De Beers Diamond Jewellers (which launched initially as De Beers LV) was, with some in the industry feeling threatened by its presence. But Leymarie says the company is a retailer buying diamonds on the open market like any other.
David Walker, who recently purchased and relaunched Shreve Crump & Low in Boston, and who is the company's owner and CEO, said he doesn't see De Beers as a threat either online or in its brick-and-mortar stores.
"I think it's great. It's good for the diamond business, it's good for everybody who is passionate about their business," he says. "I think that's an inevitable evolution in our business, to compete online."
Leymarie says De Beers will offer a wide range of diamond jewelry online, including the "Talisman" and "Bridal" collections, retailing at $500 and up. Personalized service will be available through De Beers' private client services, online, via phone or in the store. And De Beers.com will also launch a new "Forever" engagement ring collection with De Beers-selected diamonds. Prices for the collection, offered in platinum with stones ranging from 0.5 to 1.5 carats, will start at $2,000.
In terms of store-only items, Leymarie says "unique" pieces that require further explanation to customers will not be sold on the site. For the most part, he says, the site will sell items up to $10,000.
"We have an interesting offer available online to buy, but obviously we'll try to leverage the Web to welcome the customer in the stores," he says. "We want to be able to maximize [our] reach, and the Web is clearly a very good tool for that."
While the Internet is often viewed as a vehicle for discounting, Leymarie stresses that items on the site will cost the same if bought in-store.
"We want to be truly transparent in terms of pricing and in terms of offering. The Web is a strong vehicle to show the consumer who we are and what we're doing," Leymarie says.
Meanwhile, the company is also searching for a new North American CEO to replace Alyce Alston, who resigned in March. Retail Director Hamida Belkadi is currently the acting CEO.
"The business is doing very well and we already have a very strong team in the U.S., so I have absolutely no concern on the short-term for the demands of the business," Leymarie says. "But we're clearly looking. We have huge ambitions for this market and want to have the strongest team."
Citing no time frame for the CEO search, he says the focus is now on new initiatives and collections, including designer Stephen Webster's men's collection, due out as early as this summer, and a Talisman watch collection. Leymarie admits the company—which will have about 30 stores worldwide by year's end—was nervous about its U.S. debut, but it's paid off so far.
"The first results we have are quite reassuring for us and confirm our strategy to try to really be on the map in major markets," he says. nj
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