Blue Niles

Amazon.com makes only a 15 percent margin on the jewelry products it sells. This enables Amazon.com to sell diamond earrings for $1,000 (traditional jewelers charge $1,700 for the same). Do you think that Amazon.com will succeed in selling this type of jewelry as Blue Nile did in selling expensive engagement rings?Competition between Blue Nile and Amazon.com will continue to increase. In your opinion, which one will win (visit their Web sites and see how they sell jewelry)?

To compare Blue Nile and Amazon, we have to look at the volume and access of these companies in the customer department. Amazon is a worldwide e-commerce company with millions of customers in not just a single niche but hundreds. In comparison, Blue Nile does not have this much customer base and a very strict niche. Amazon is a leader in the world e-commerce while Blue Niles is much less in experience in the e-commerce. Amazon has a waste network of affiliates and already develop a huge supply chain system which Blue Niles has yet to do. Another factor that Amazon outclasses Blue Nile is the price of the product. Amazon is offering the same thing for much less, 1000 dollars compared to Blue Nile price of 1700 dollars. All of these are factors that compel me to come to a conclusion that Amazon will do much better than Blue Niles in the jewelry business. Amazon is indeed a tough competitor for Blue Nile.