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Sales off, Blue Nile looks to build market share
Coming off a brutal fourth quarter that slashed Blue Nile’s revenue by 23% and net income by 53%, CEO Diane Irvine figures it’s an ideal time to take advantage of the jewelry retailer’s still-strong market position to build market share.
When you’re a strong player in your market, tough periods that cause sharp drops in revenue and income can also offer opportunity, says Diane Irvine, CEO of online jewelry retailer Blue Nile Inc. Coming off a brutal fourth quarter that slashed Blue Nile’s revenue by 23% and net income by 53%, Irvine figures it’s an ideal time to build market share.
“Our competitive position is strong, and our value proposition is especially relevant to consumers in this climate,” she says. “We are focused on extending our leadership position and continuing to gain market share in this environment.”
For the fiscal fourth quarter ended Jan. 4, Blue Nile’s sales fell 23.3% year over year to $85.8 million, as net income sank 53.3% to $3.5 million. For the 53 weeks ended Jan. 4, sales dropped 7.9% to $295.3 million.
International sales, until recently a growth channel for Blue Nile, grew in 2008 but declined in the fourth quarter. The retailer, which opened a dedicated European distribution center about three years ago, reported full-year overseas sales of $27.7 million, up 62.9% from the prior year.
Despite the declines, however, Irvine notes that Blue Nile still posted strong financial numbers compared to the rest of the market. And with strong liquidity marked by $54.5 million in cash and cash equivalents, she says, Blue Nile will keep investing in better ways to serve its customers.