Blue Nile is able to successfully offer diamonds for higher prices by emphasizing the large variety of certified high quality stones available and a markup that is significantly lowers than its competitors. The main scource of Blue Niles competiive advantage over any traditional jewelry store is that it has lower facilities cost and inventory expenses.
Only one central warehouse needed to stock its entire inventory but transportation costs are high because it provides customers free shipping. Moreover the firm is allowed to display for selling its inverntory of some largest diamond manufacturers.
Selling diamonds at higher prices online works for Blue Nile because its strategy is based on its target market customers who want high quality diamonds but have strong emphasis on receiving good value for the money.
However, Tiffany uses its retail stores which are 180 in total worlwide and through online channel aswell. Alomost 48% of the sales contain the products which contain diamonds and the other half of the sales come from high end jewelry with an avarage sale price of 00.
Tiffany offers wide variety of low demand items through its online sales.