Ahead of his In Conversation With… talk at IJL 2017, 77 Diamonds managing director, Tobias Kormind, shares his insights on the state of online diamond sales and his top advice for excelling in the digital sphere.
Q. A decade ago 77 Diamonds was a jeweller on the London start-up scene. Today, you are Europe’s largest online diamond jeweller. What are your top challenges?
The main practical threat that the online diamond jewellery sector faces today comes from two enormous players. Using all their financial might along with aggressive tactics, they are fighting it out for a monopoly, mainly in the US. In the next few years, I predict an epic battle between them for market dominance which could have several potential outcomes, all of which may eventually spill over into Europe. They can afford to innovate at a faster pace than any other UK players and as the millennial customers migrate online, their market share in the UK and Europe could grow.
I am slightly worried about the growing debt-fuelled consumer spending coming to an ugly head. Currently the UK consumer is still spending, albeit at a slower rate, but ruptures from Brexit could cause this to unravel. The only good thing about Brexit so far, has been the devaluation of the pound, which has made UK jewellery manufacturing more price competitive and brings with it more opportunity for the UK jewellery industry.
I also believe that there is a big question London should be asking itself and it is this: Why is it that despite being home to world-class art and jewellery schools and home of many luxury brands does the UK only attracts 3% of diamond jewellery purchases globally? Surely there exists an opportunity for London to become a jewellery leader and the pre-eminent destination for jewellery, in the way Geneva is for watches.
Q. Some say profit margins are being squeezed at every angle, would you agree?
The diamond and jewellery landscape has changed dramatically over the last 10 years, most of it in a negative way for almost everyone in the industry. The internet has empowered the consumer through greater transparency and created a new reality. The challenge is to accept, then embrace this change and recognise it as an opportunity instead of sticking one’s head in the sand. But in business, and especially the luxury goods business like ours, pricing isn’t everything. In my talk at IJL where I’ll be in conversation with Claire Adler, we’ll explore topics including the customer experience and digital communications.
How are the best companies forging ahead in a competitive environment?
There is a huge amount of work that goes into brand building, creating trust, forging relationships with customers so that we understand their needs at an early stage of their search. I’m a huge fan of the way Apple, John Lewis, Farfetch and Net a Porter go about their businesses. Some people say the high street is dead but the fact is the future of retail can incorporate the high street, in combination with other channels.
How important is imagery and social media with an online business?
Imagery and social media are hugely important in encouraging an understanding of what a company can deliver. At 77 Diamonds we’ve also taken a long term view about media relations, keeping our name out there and sharing our diamond jewellery expertise with as wide an audience as possible.
What are your top tips for emerging jewellery e-commerce sites?
Like any consumer facing business, put the customer first and try to think about the whole experience from their point of view. Then make improvements accordingly. Secondly, remember value is more than just price. Offer impeccable products and a great customer experience at every touch point.
Don’t miss our fantastic series of In Conversation With… talks at IJL 2017!