Dot Combat: Surviving the Internet Wars

The not-so-old adage that massive jewelry “e-tailers” will replace mom-and-pop jewelry stores is being debunked. Studies show that retailers will not only survive the Internet craze but also reap rewards from it-if they invest in it wisely. (See sidebar next page.) The personal observations of jewelers involved in online initiatives support the research. And it doesn’t matter whether the Internet is used as an e-commerce site or as an informational tool. The key is to have a strong presence.

Among jewelers, Mark Moeller, owner of R.F. Moeller Jewelers, St. Paul, Minn., is an Internet pioneer. When he launched his first Web site nine years ago, he shared the World Wide Web with fewer than 10 other jewelry sites, he says. Key in the word “jewelry” in a search engine today and thousands of possibilities will appear.

Times have changed, but Moeller’s attitude toward the Internet hasn’t. He sees it as a place jewelry retailers need to inhabit. If used correctly, he says, the Internet will help retailers reach more customers while keeping current customers better informed and happy. He laughs off suggestions that the proliferation of large, well-capitalized “pure-play” e-tailers-companies that exist only on the Internet-will threaten retail establishments.

“Those sites are a zero threat to the good retail jeweler,” he says. “People still want to come into a store to buy, touch, and feel jewelry. It’s an experience to come into a jewelry store. The Internet is never going to replace that. I haven’t changed my tune in five years.”

Making better consumers. Consumers want information, and Web sites can deliver it to them, says Jim Sterne, the owner of Target Marketing in Santa Barbara, Calif., which specializes in information technology marketing strategies. “It’s critical that the site is really easy to use and understand,” he says. “You want to explain as quickly as possible what you’re selling. It’s all about the customer.”

Sterne says it’s important not to get caught up in telling customers about the company. A Web site must deliver information quickly, but the information must focus on products and jewelry knowledge, not on the company. “The biggest mistake everyone makes is having a site all about [the company] and not about the consumer,” he says. “Don’t put ‘about us’ on the homepage.”

Moeller uses his Web site to inform customers and to attract them to his two 2,200-square-foot stores, one in St. Paul, Minn., the other in the Minneapolis suburb of Edina. He says that as many as one-third of his new customers were attracted to his stores after visiting the Web site.

His site comprises 70 well-organized pages of information. About 20 pages have store and product information. The rest offer consumer information on diamonds, gemstones, and antique jewelry as well as information from other sources, such as the American Gem Society and De Beers. The site also provides links to some of the product lines the store carries. “For people who come in fresh, there’s some good information,” Moeller says.

Coming back for more. Web sites must not only attract new consumers but also get them to return. “That’s when it gets tricky,” Sterne says. He agrees with Moeller that education is vital. He also agrees that the ability to link to diamond or gem association sites or to cut and paste information from those sites (with permission and credit) and use them on the company site provides customers with the information they need to feel confident when making a jewelry purchase. He warns people not to go overboard with games that have little value to the customer.

“We all need to be taught on how to buy diamonds and pearls,” he says. “A site should explain what the ‘four Cs’ are and what a good emerald is vs. a bad emerald.”

For well-financed sites with e-commerce capabilities, information noted on a sale could be used to sell additional products. “If I come back to the Web site to buy jewelry, it could remind me that the last time I visited the site I bought a pearl necklace, and [it could] inform me that there is a pearl necklace enhancer,” Sterne says. “It allows consumers to choose what they can afford to spend.”

Sterne cautions against overlooking the e-mail that a Web site attracts. “As soon as you post your site, you will start receiving e-mail,” he says. “You must answer e-mail within 24 hours.” Depending on how much e-mail a site elicits, Sterne recommends either answering it yourself, teaching others in the store how to do it, hiring someone for the job, or buying e-mail software that organizes the messages.

Borsheim Jewelry Co. has a 45,000-square-foot store in Omaha, Neb., and a national catalog business. Its Web site is a full-fledged e-commerce site that attracts both local and national consumers, says Adri Geppert, Borsheim’s marketing and advertising director. In addition to providing quality information, the site also allows viewers a glimpse of in-store activities. The rules of the World Wide Web are still being written, and while the site attracts a lot of visitors, Geppert says they try many different methods to keep customers coming back. “We do a lot of in-store events,” Geppert says. “And we try to replicate them online the best we can.”

Borsheim also publishes a weekly story on its Web site. It’s called “Romantic Reflections, Unforgettable Stories of Love and Life,” and it always involves a piece of jewelry.

Is anybody here? Cyberspace is a crowded, confusing world for the average Web user. Letting people know where your Web site is and getting them there are difficult tasks, requiring a great deal of self-promotion and various advertising techniques.

“How to get people to your site depends on the business plan,” says Sterne. “If you want to attract people to your local store, advertise on Web sites about your city. If it’s nationwide, go to Yahoo and place an ad on its jewelry page.” He adds that if the budget allows it, you can buy a “search ad.” When a user keys in the word “jewelry” on a search engine, the ad appears along with the results of the search.

Another tactic is to hold an event that’s connected to the store and the Web site. “Something that’s fun and attention getting,” says Sterne. As an example, he suggests having couples write their love stories on the Web site and giving an engagement ring to the couple with the best story. Another idea is to use direct mail advertising by zip code. You can target both affluent residents as well as people with lower incomes with promotions geared to each audience. For example, attract those of lesser means to the store by holding a drawing for a 50% discount on a jewelry purchase, but have entrants sign up for it on your Web site. Other promotions to attract Web users to the store include exclusive sales and free watch cleaning services.

Moeller puts his Web site URL (universal resource locator) on nearly every piece of advertising he uses. “We tag it at the end of our radios ads, on TV ads, in some print ads, and in our direct mail,” he notes. “We also have the largest jewelry ad in the Minneapolis-St. Paul phone book.”

Since Borsheim’s Web site serves two audiences, it uses a variety of advertising methods to attract people to the site. “We try a lot of different things,” Geppert says. “We’ve tested online advertising purchases with big search engines, and we use traditional print advertising.”

The company also links its Web site to other local businesses. For instance, Geppert says Borsheim’s tied its site to a local bank’s promotion of a new online banking system.

Is the Internet for everyone? Linde Meyer, owner of Linde Meyer Selections in Philadelphia, says she isn’t overly concerned about getting on the Internet. She operates a small retail atrium in the Shops at Liberty Place and sells high-end designer jewelry and gifts for a specific customer. She believes that it’s difficult to translate the design concepts she sells to the Internet medium.

“Diamonds on the Internet are doing quite well. That’s because it’s a commodity,” she says. “I am not a store that sells commodities. A piece that’s design-oriented is more difficult to describe (and sell) over the Internet. People have to be able to translate over the Internet from a maker’s point of view.”

Although Meyer doesn’t have a Web site for her store now, she’s working on developing one. But she’ll create it in the image of the store, she says. It will be purely informational. There will be no e-commerce component. “It will reflect the image of my store and how and what we’re selling to customers.”