Diamond disrupter: How this digital-focused jewellery retailer is shaking up the marketplace
Every day, thousands of shoppers in the Oxford Street area unknowingly pass by the workshop of 77 Diamonds.
Behind a nondescript door, workers craft wedding rings with diamonds worth tens, if not hundreds, of thousands of pounds.
A short walk from the dingy workshop – decorated inside with a topless Zoo calendar and a Euro 2016 wallchart – is 77 Diamonds’ Mayfair showroom.
The company sells diamonds, mainly in wedding ring form, ranging between £500 and £500,000 in price, attracting visitors from China, Russia, Malaysia, Indonesia and Hong Kong.
Tobias Kormind, a former Morgan Stanley investment banker who co-founded 77 Diamonds in November 2005, portrays the online-focused jewellery retailer as a diamond industry disrupter.
Read more: Giant 1,109-carat diamond fails to sell at Sotheby's auction
“We’re not very liked in the marketplace,” Kormind says. “That’s because a lot of people are resting on their laurels about the ways things have always been done.
“And actually we’ve challenged the status quo and shook up the market. And, of course, when you ruffle feathers, there are consequences of that.”
Kormind positions 77 Diamonds between Tiffany and Co and Boodles at the top end, and Ernest Jones and H Samuel at the bottom. Naturally, he says his offering is the best.
“Technology and the internet has definitely allowed a brand like us to emerge as quickly as we have,” says Kormind. “I think it’s changed the product range and what people are doing at the large jewellery brands as well.
“Because I think engagement rings, for Tiffany, used to be their core. And actually they’ve had to diversify out as well. People understand it’s not just about the Tiffany box, but actually a diamond is a diamond – whether it comes from Tiffany or it comes from another company, it’s not more special.”
He adds: “So I think the traditional brands have definitely had a big challenge from online players like us.”
Read more: People are buying fewer diamonds now it's summer
Kormind says the company achieved a revenue of £18m in 2015, with a net profit of £500,000. Its staff headcount is 44, and growing.
Despite being an online-focused company, Kormind says the business does not save on costs compared with rivals, pointing to the Mayfair showroom he’s in, marketing costs and running the website.
“It’s not a cheaper way of doing things,” he says.
“It’s just the new way, and it’s a better way of doing things. It’s about being where our customers are as opposed to sticking a store on a high street, hoping for foot traffic and trying to push on what products you have in store. That model is under threat.”
