From JCK Magazine: Retail Jewelers Discover Diamond Dashes



This article originally ran in the November issue of JCK Magazine.

Diamond Dashes have become the promotional event du jour for jewelry retailers, with many benefiting from increased Web and store traffic, new bridal customers, and a significant boost to their databases including much-coveted e-mail addresses and cell phone numbers of Gen X and Y members.

The company behind these events is SCVNGR, a mobile marketing and gaming business that took on its first private-sector client in 2008 and now works exclusively with retail jewelers.

The SCVNGR story begins at Princeton University, where company CEO Seth Priebatsch studied. As part of an assignment, he created an algorithm that could move people from point to point. A software application came next, and, with some fine tuning, Priebatsch developed a mobile marketing model. His first clients were mainly other Ivy League colleges that were organizing scavenger hunts as part of freshman orientation. Students received hints and clues for the events on their cell phones.

Seed money from Dreamit, a business incubation firm, helped Priebatsch find a business partner, Michael J. Hagan, to take the college campus model to a significantly larger scale with a citywide application. They founded SCVNGR in 2008 and later brought on Nick Pirie to head the promotions department (called SCVNGR Pro) and pitch their services to businesses around the country.

SCVNGR Pro promotions executive Nick Pirie fires up the crowd.

Although the company relies on high technology, they called on customers the old-fashioned way, by knocking on doors in Philadelphia’s Jewelers’ Row. One of the doors Hagan knocked on was Robbins Diamonds on Walnut Street.

"When Michael came to us we were already thinking of doing a scavenger hunt event after learning about a store in Boston that did one," says Gordon Robbins. "When the technology behind the mobile marketing event was explained, we jumped on it."

Robbins was not only the first SCVNGR customer but also the first client to hold a Second Annual Diamond Dash, which landed on Halloween this year. "If all goes well with the second event, we are planning on doing a third," Robbins said at press time.

Building on that first client, SCVNGR Pro soon was working exclusively with retail jewelers. "To date we’ve worked with 37 jewelers," says Pirie. "By year’s end we should be around 50. With advanced bookings out till July and August of next year, we’re looking to do 100 events in 2010."

Whether it’s Billings, Mont., or a large city like Detroit, SCVNGR’s approach is the same: It exhaustively researches the town or city to develop clues and hints for a scavenger hunt. Local landmarks, historical sites, parks, natural features like rivers and creeks, and even buildings and retail outlets are fair game.

The unique feature of SCVNGR’s technology is the ability to send a large number of people to the same destinations, but using different routes driven by varying clues unique to each participant. Whoever answers the most clues correctly in a two-and-a-half- to three-hour scavenger hunt wins the grand prize, which is often a diamond engagement ring of significant value.

Only couples may enter the contest, and they submit letters telling their love story. Not all letters are serious. "We get some people who are brutally honest and say, ‘I want to find the ring so I can sell it and make money," says Pirie. "Obviously those entries are not accepted."

There have been some special exceptions. Jim Kruse, co-owner of J. F. Kruse Jewelers in St. Cloud, Minn., held a scavenger hunt in July. "We had a local woman whose brother served in Iraq and donated a kidney to a fellow soldier," says Kruse. "The surgery took him out of work for some time, and his sister wanted to be a participant because her brother couldn’t afford an engagement ring."

SCVNGR provides a turn-key promotional package that includes negotiating airtime with local radio and TV stations, live spots the day of the event, distributing press releases, and organizing interviews. The company emphasizes radio. "The key is to get the word out so people can learn about the event from news and entertainment outlets they listen to and trust," Pirie says. "That’s why we work closely with morning-drive radio programs."

Organizing cosponsors for mutually beneficial partnerships is also part of the package. Wedding gown boutiques, reception venues, convention centers, florists, wedding planners, and limo services are part of the cross-promotional mix, as are popular restaurants and bars where after-event parties are held.

Jewelers often leverage name brands that they carry. Hearts On Fire, Lazare Kaplan, and Biro88 are among the ideal- and special-cut diamond manufacturers that have cosponsored Diamond Dashes.

Lazare Kaplan cosponsored Marci Jewelry’s Diamond Dash. The event, in Bellevue, Wash., a suburb of Seattle, was one of SCVNGR’s largest scavenger hunts. "Lazare Kaplan was a terrific partner for this event," says store owner Rex Mudd. "They gave us a significant discount on a platinum Buttercup ring, set with two carats’ worth of ideal-cut diamonds. Like all the participants, the Lazare people who came to the event had a great time."

A smaller-scale event with J.F. Kruse Jewelers in St. Cloud, Minn., had just as big an impact for Eugene Biro, creator of the Biro88-cut diamond. Biro flew from New York to the small Minnesota city to provide staff training and to see the scavenger hunt for himself. "Based on what I saw, this was a huge success," he says. "I will definitely be a part of a second annual event."

In naming the event, Kruse took a different approach. In a SCVNGR creative team meeting, Kruse’n for Diamonds was pitched to the client for added brand equity.

SCVNGR also came up with pre-clues that helped Penn Fix, owner of Dodson’s Jewelers in Spokane, Wash., in the run-up to a recent Diamond Dash. "In a three-day period we had over 225 couples in the store," says Fix. "Many couples asked to see the ring we were giving away to the winning couple, but what surprised me was many couples said that even if they lose, they’ll most likely come to Dodson’s for their ring. That’s powerful."

Penn Fix, owner of Dodson's Jewelers in Spokane, Wash., had special Diamond Dash sweatshirts made for the staff.

To help brand his store’s design services, Fix’s grand prize was the store’s own custom engagement ring, which accounted for $15,000 of Fix’s $35,000 outlay for the Diamond Dash.

Although scavenger hunts involve hundreds of couples, they’re run from a single laptop. The SCVNGR mobile marketing program allows the event operator to track the movements of participants as they travel around the city in colorful event T-shirts featuring the store’s logo and tagline and a list of cosponsors.

Events typically start at or near the store and end at a venue that can accommodate a large after-event party. Sites have varied from public parks, bars and restaurants that co-sponsor the event, to large convention centers. When the winning couple receive their notice-by, you guessed it, a text message-usually an impromptu proposal follows on stage. "This happens about 60 to 70 percent of the time," says Pirie.

In addition to copious amounts of free media coverage, the biggest benefit comes at the end of the Diamond Dash: a spreadsheet containing the names, e-mail addresses, and phone numbers of participants. "This is like gold to a jeweler," says Pirie. "But what they do with this information can mean the difference between a great promotion and a phenomenal promotion."

The increase in online traffic prompted Fix to revamp his Web site, while other jewelers are improving the quality, delivery, and frequency of e-newsletters.

Post-event customer contact is also imperative. Many jewelers send thank-you notes to participants, followed by invitations to the store for gift-giving occasions, namely Christmas and Valentine’s Day. Asking participants six months early to join in the second annual summer Diamond Dash keeps customers engaged for an entire year.

For SCVNGR, whose executives are in the 18-35 demographic that retail jewelers are trying to reach with Diamond Dashes, the real success is breaking through preconceived notions about jewelry and jewelers held by Gen X and Y. Says Pirie: "When people in a jeweler’s market see the store owner in a pair of jeans and wearing a colorful event T-shirt having a good time at a party and being interviewed by a radio personality participants know well, it helps make the jeweler, his store, and the products sold that much more approachable."