The jewelry industry is notorious for its insane markups on products and confusing array of terminology related to the metals used or gemstone grades – as with the “four C’s” of diamonds, for example. Now, a new startup – that’s managed to snag the old domain name Ice.com – is trying to change that. With its online jewelry marketplace, the company aims to not only offer great deals on rings, necklaces, bracelets, earrings, and more, but also wants to educate consumers so they know what price they should be paying for a given item.
Ice.com, the domain, has actually been around for a while. In its previous incarnation, it was also an online jewelry store. But the older company didn’t make it through the recession, allowing the new owners to buy the domain name for $3 million in 2014 in order to set up their own shop.
Now, the new Austin-based Ice.com is led by Justin Yoshimura (Chairman), who earlier sold his social loyalty platform 500friends to Merkle, along with Brandon Proctor (CEO), previously CMO at Build.com, where he helped grow the business from $70 million in online retail to over $500 million over the course of five years.
Ice.com also raised $2 million in seed funding, in an oversubscribed round which included investment from Maveron, Rivet, Quest, Uj Ventures, and angels Chris Friedland (Build.com founder), Kevin Chou (founder/CEO of Kabam), and Niraj Shah (founder/CEO of Wayfair).
(The funding actually closed in July 2015, but the company hadn’t announced this until now, because it wanted to bring its platform out of beta first.)
Explains Proctor, the founders decided to enter the online jewelry market because of the opportunity they both saw.
“The online part of jewelry is still in its infancy,” he says. While the U.S. jewelry market today is over $80 billion (for fine jewelry and watches combined), the e-commerce portion is still very small.
“It’s between 5 and 7 percent of the total jewelry market that’s actually online,” Proctor notes.
“It’s one of those laggard categories – it’s still stuck in the dark ages. And the growth you can experience in an underdeveloped category is huge,” he adds.
Ice.com’s website today operates as a marketplace, and specifically one that targets the middle of the market – meaning rings that are more likely around the $100 price point, not $5,000-plus, as on high-end sites.
Since Ice.com’s goal is to offer affordable, but quality, jewelry, its on-staff gemologists vet the sellers before they go live by ordering samples, and then they continue to randomly test the products after the sellers are live.
Today, there are currently over 100,000 SKUs online, but by the end of this year, the plan is to increase that to 350,000 or possibly even 500,000. That would make Ice.com bigger than any other jewelry site on the web.
In addition, Ice.com negotiates with vendors on pricing – it even requires they offer their items at a certain – but undisclosed – percentage off from competitive market pricing. (Ice.com actually crawls other retailers and marketplaces on the web to determine the current market price for an item.)
Proctor explains that Ice.com’s advantage over other marketplaces is that it’s a jewelry-specific site. Ebay may be large, but its reputation is still that it’s a “secondhand” marketplace. Amazon, meanwhile, isn’t specifically designed for selling jewelry and doesn’t always have all the attributes an online jewelry store would have.
“Because we have a specific jewelry-based site that caters just to this audience, it gives us the ability to acquire product today at a much lower rate,” says Proctor. “And we actually require that of our vendors.”
It also just rolled out a VIP program that lets buyers pay a monthly subscription (currently $12.99/mo, though that could change) in order to buy jewelry at close to cost, as well as enjoy other benefits like free birthday gifts, recommendations from a personal stylist, extended warranties and more.
However, one of the key features Ice.com will offer won’t go live for about three more months: the education component.
The company has been developing a database of information that will be dynamically linked to products on the site that will help consumers understand what different terms mean, and most importantly, what a fair price for that item may be. In the future, the goal is to help consumers find the best price – even if that’s not on Ice.com.
As someone who’s the ideal demographic for Ice.com – female and 30’s-ish – I’d say the site has a good shot. When checking it out ahead of our interview, I found myself favoriting items and even buying something for myself – yes, at full price, out of my own pocket, in case you’re wondering.