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diamondsFor most cross-channel retailers 2008 was a financial disaster, and surviving to discuss 2009 is an achievement. No different at Zales Jewelers. The mall and outlet center-based retailer closed more than 100 stores and took an 18 percent hit in 2008. But one of the bright spots has been its ecommerce operation. As SVP Steve Larkin says we "do a lot of stuff" online that doesn't get as much publicity as the collapse of the high-end jewelry market. We talked to Larkin after the company announced that its revenues for January and February had stabilized for 2009.

We've heard a lot lately about the saving power of ecommerce as offline retail struggles and the economy starts to crawl back. Zales has certainly had its offline problems, and I'm interested to know your macro view of retailing right now.

Ecommerce is better than traditional retailing. And that comes from advances in just about everything that has to do with online retail. We're constantly improving the customer experience and constantly improving customer service. I also think we provide a lot of value online for the customer. They can comparison shop, they can research products, and they can get best price. We will continue to invest in ecommerce and continue to cross-promote our online store through our offline stores.

How do you see Zales as online brand?

We know we're not Tiffany's. We're a value-oriented, mid-market retailer and we try to appeal to a mass audience. But we carry high-value, fine jewelry for customers who want that.

It seems like jewelry would seem to be a tough sell online, yet Zales, Blue Nile, Ice.com and other retailers are doing well. Why would people buy diamonds online?

You know we like to think we invented everything, but the guys who really proved that jewelry could sell were the Sears and Speigel catalog guys. They sold fine jewelry sight unseen for years. Then the guys with TV shopping took it to another level. They built their business on jewelry because it was an emotional, impulse purchase. It's easy to shop and easy to ship. I think we're building on that foundation.

Your company was on the case with social media early on. You've had an area on your site called "love stories" where customers share their engagement or special event. Has that been successful from a business perspective?

I have been absolutely astounded at how many stories we have received over the past year. Astounded. And it does a few different things for us. It shows us that our customers will take the time and effort to publish something and it also acts as a testimonial for our marketing. Now we've also recently added BazaarVoice, which gives customers a place to rate and review products. That's feedback for us. It has helped us adjust product selection, and provide some content for the site.

What about Facebook and Twitter?

We have a Facebook page. I tread very carefully around the social media networks because so far it has been very hard to generate ROI. We're not going to be the kind of company that adapts the biggest and most expensive  marketing approach.

How will you market the website?

A lot of cross-promotions in the store. In fact we still do a lot of offline marketing. We do a lot of TV, lot of print, lot of direct mail and a lot of outdoor. In some cases we go head to head with the pure plays (Ice and Blue Nile) and we do spend money online for those customers.

How have your customers changed in their expectations of Zales?

They want to be part of a community. We've been doing that for 85 years.

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Published 30 March, 2009 by John Gaffney

John Gaffney is US Editor at Econsultancy. Follow him on Twitter

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Comments (5)

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Janice

I see that Zales is still running e-commerce seperate their brick and mortar stores (ie, you can't buy online, pick up in store). Isn't there a way to link the two to drive sales in the brick and mortar? Macy's says that jewelry is one of their biggest online-to-store products, Sears lets you buy online and pick up in a store, and Fred Meyer Jewelers has a Find Local button on their site now.

I still hesitate to buy jewelry online, but I like to look at it online. Seems like there is a natural way to boost store sales here.

over 7 years ago

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Matthew Greene

In fact, the way for Zales to really embrace the web with dramatic results is to invert the model shown in this article.  WIth our trademarked Click2Mortar Media platform, we've been helping major retailers and brands find their best prospects on the Web, and driving them to retail counters, accountably. And btw, lifting sales vs. last years sales - even in this awful retail environment.

over 7 years ago

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cell

Macy's says that jewelry is one of their biggest online-to-store products,

over 6 years ago

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Amia

Does anyone know what companies does ZALE's purchase their jewelery from? Caountry and manufacturer? Thanks!

over 6 years ago

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hadi zafa, CEO at Blog

Shopping in zales.com is fun ... besides the cost is competitive, the goods also nice nice. http://www.engagementringforwomen.net/

almost 2 years ago

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