Innovative Retailer: Diamond Design’s Pat Thompson

Designing a letter-perfect approach to customer relations

Long before CRM (customer relationship management) became the buzzword it is today, Pat Thompson was using the basic tenets of this approach to create his own brand of jewelry retailing. On some innate level, he understood that to build relationships with customers, he needed to rely on a no-pressure marketing style that valued the personal interaction over the sale. Using these principles as his cornerstone, in 1990, Thompson, a third-generation ­jeweler trained as a goldsmith, left the family business after working with his father for 15 years to open a 300-square-foot office/showroom. With little startup capital and barely enough inventory to fill his briefcase, Thompson had an idea: He’d write letters—or “communications”—to customers letting them know he could be their personal jeweler. Numerous jewelry design and manufacturing contacts allowed him to source fine-quality jewelry in unique designs. He created a loyal following and, with that, repeat customers who brought in referrals. As customer details were updated and modified, his letters became more tailored and customized. Eventually—with the help of a graphic artist—Thompson developed an artful approach to his letters. The scheme worked. Thompson outgrew his showroom and, in 2003, opened his current 1,800-square-foot location.

When did CRM help your business take off?

The idea of having a relationship with my customers had always been the basis for opening my own jewelry store. In the early 1990s, I realized that more needed to be done to take this practice to the next level. I began working with a business-marketing professor from the local university who took an interest in helping my small business. After several meetings, this instructor told me that CRM can’t work on its own. While managing customer relationships, I also needed to build a brand personality in my market.  

For you, what’s the most important element of CRM?

Communication. Every morsel of communication a store owner has with their customer must reflect their brand personality. And the customer relationship needs to reflect that brand personality.

How did CRM evolve for you over time?

The challenge was finding new ways of communicating with my customers. That’s when I came up with the idea of non-selling events. My first was a Fabergé exhibition. At first I was going to make this a small store event. But when I told my contacts at the local museum about bringing the Fabergé people here, they thought it would make for an interesting event for the public as well. I worked with them to organize the event on a much grander scale. It was a great success.

What did you learn from this experience that changed the way you host customer events?

One word: special. You need to have an unusual feature to the event to make it interesting and to make people really want to attend. I’ve learned that it’s not what you do. What’s more important is how you do it. Execution is everything. The Fabergé event was very upscale with fine hors d’oeuvres and a jazz quartet. Also, I didn’t want the event to be about selling, but I wanted to incorporate a jewelry element. I had models walking around wearing jewelry. Wish lists for me are very obvious and overt. I’d rather have women identify the types of jewelry they like and would want to own—it’s a far more subtle approach to letting their husbands or boyfriends know what to buy so he can be the hero.

You tried e-newsletters, but went back to doing it the old-fashioned way. Why?

The e-mail blasts seemed very commercial and uninteresting. I was guilty of the same promotional sins as other jewelers—content that wasn’t engaging or interesting, such as “July is ruby month…” This doesn’t get people’s attention, nor does it have value. With 10,000 clients in my database, letters to key clients cost me roughly $50,000 a year. I try to make each letter a “visual experience” with fine paper stock, stationery and matching envelopes, a tailored letter to the customer, as well as high-resolution prints of ­jewelry done in an artful format. The postage stamps are even special-edition. I pay attention to every detail. A special communication makes my jewelry seem that much more special to the recipient.

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