Diamond e-tailer finds success with hybrid retail model

Posted July 19, 2011 | By Lorna Goodyer

Things may be tough on the high street, but online diamond jewellery retailer Diamond Coco says business is “bursting at the seams” and sales have soared year on year.

Diamond Coco founder Anthony Hansen believes he has found a winning formula in a hybrid model that comprises an online operation and showroom offices, where those who prefer to touch and feel the jewellery can visit the e-tailer in person.

Hansen set up the showroom last October, after rapid growth forced him to seek larger business premises. To keep costs to a minimum, Diamond Coco stocks its showroom with low-cost prototypes. “We’ve got rings made out of sterling silver or that are rhodium-plated. They look like the real thing but they’re not. The cost for us to hold it is, say, $50 rather than hundreds or thousands of dollars,” he explained.

Although online sales are increasing at a steady pace, Hansen revealed that his business’s biggest growth is coming from the showroom – something he attributes largely to local advertising. “The conversion of the sell once someone has been into see us is extremely high. It’s not 100 per cent, but it’s getting pretty close,” he told Jeweller, adding, “In the past 12 months the referrals have been so strong that we are now writing more offline sales than we are online.”

The showroom concept has worked so well that Diamond Coco is now considering expanding its presence to a retail store, although Hansen believes the key to success would be a non-traditional format, carrying through some of the principals of his existing hybrid business.

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