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Expecting slower overall growth in sales, Blue Nile is bullish on a dozen foreign markets
Rapid growth in overall sales may be slowing but Blue Nile, the largest web-only jewelry retailer, is forging ahead overseas to build on surging international sales.
When the shine begins to wear off, it’s time to polish a new strategy. At Blue Nile Inc., rapid growth in overall sales may be slowing but the largest web-only jewelry retailer is forging ahead overseas to build on surging international sales.
Blue Nile doubled international sales last year to $17.2 million to customers in Canada, Ireland and the U.K. This year, it will extend its reach to hundreds of millions of foreign consumers in 12 additional markets in Europe and Asia.
The expanded global reach coincides with slower overall growth that Blue Nile expects this year. Although Blue Nile’s net sales climbed to $319.3 million last year, up 27% from $251.6 million in 2006, the retailer is projecting a more conservative overall growth rate of 10% this year.
But by laying the groundwork for a wider impact from international sales, it expects to be in a stronger growth position than it would have otherwise, executive chairman Mark Vadon says. “This launch allows us to build off of the success we have seen in the U.S., Canada and the U.K. and, most of all, provides us with the opportunity to offer unmatched quality, selection, service and value to the more than 400 million residents in these new markets,” Vadon says.
Blue Nile launched new web sites in Canada and the U.K. last year to support increases in foreign sales with features such as the ability to buy online in local currencies. It also opened an office in Dublin, Ireland, with customer service and fulfillment operations to better serve its growing customer base in Europe.
The extra attention to foreign markets paid off last year as fourth-quarter international sales grew more than 150% year-over-year and full-year 2007 international sales more than doubled the sales of 2006. International sales were strong across multiple product categories including engagement rings, diamonds, pearls and gemstones, the retailer says.
Now, from its U.K. web site at BlueNile.co.uk, Blue Nile will offer free shipping to Belgium, France, Germany, Netherlands and Spain through the FedEx International Priority service. All shipments will be sent from the retailer’s Ireland facility and be available for purchase in British pounds.
Blue Nile also will use the FedEx International Priority service to offer free shipping from its U.S.-based BlueNile.com to Australia, Hong Kong, Japan, New Zealand, Singapore, Switzerland and Taiwan. All shipments will be sent from Blue Nile’s U.S. facility and be available for purchase in U.S. dollars. Blue Nile will offer free shipping throughout the 12 new markets, Vadon says.
“International growth will remain a priority for Blue Nile going forward,” Vadon says. “We are excited about introducing the Blue Nile brand into these 12 new markets and will look to this expansion as a basis for pursuing future opportunities as we build out our business overseas.”