How you determine the price you are willing to pay for a diamond?

[pricescope]

Industry starts listening, guys! We have a bunch of questions from one of the most respectful trade magazines. Summary of the answers you'll give should be published quite soon. Some of these questions might sound obvious for the Pricescope regulars but keep in mind that for the industry it might be a fresh point of view. Please share your thoughts. (Industry folks, please let consumers speak)

The first question: How you determine the price you are willing to pay for a diamond?

Our guess is that there are different scenarios and answers.

Most people (I think 95%) are still buying from local stores even if they research the subject online. So these type of buyers probably know the prices there will be higher. They might walk into the store with a printout from Pricescope or other websites like Blue Nile. How much above the web prices you're willing to pay for convenience to buy locally?

People who buy online still might prefer to pay extra for the piece of mind and buy from well established companies like Blue Nile or Diamond.com. How much more do you think is fair to pay for the well established internet brand?

There might be options involving specific settings or services unavailable online or locally, etc.

Your thoughts?

 

[Lord Summerisle]

I guess...

I started off looking around local B&Ms seeing what they had.. and their kinda prices... then hit the net in research mode... didnt really think about the search engine on Pricescope at the time... i was going to online guys direct and searching their sites... comparing stats with what i had learned... within the range of size i was after... and determining if what was being offer i was in the market for - ie could i get what i wanted within the budget i had. Once i had decided on the rock i wanted... that was seeminly cheaper than what i could find in this country - and a bonus - far better cut, since i was focusing on cut. but parallel to this i had a local chap searching with his dealers for an equivalent diamond to the specs i had given... ie a print out of the particular rock i was after... he searched, and after a few weeks said... nope cant beat it... tis a good deal you got there... so i went with it. and wa la!

/ramble

to sum up - it was cut rather than price which determinded it for me... and among the cut... i was willing to pay that little more for what i perceived to be ''the best'' cut - that microscopic perfection - that while getting the 3Cs (ex cut) i wanted was well within my deemed budget - i went all out on the last C (and in my opinion the most important)

and going with someone i trusted - having researched back over the net for mention of that company to check their rep... and once satisfied i went with it.

 

[strmrdr]

Im willing to pay extra for great service and a ton of upfront information.

Im willing to pay a little extra for whiteflash level of service.
Im willing to pay a little extra for goodoldgold level of upfront information.

I am not willing to spend extra to support someone that just wants my money and views me as just a consumer to get money from.

 

[valeria101]

Date: 3/30/2005 7:12:36 AM
Author:Pricescope

The first question: How you determine the price they are willing to pay for a diamond?

I would need a bit of clarification about who "you" and "they" are in the question:

Is this #1. "How do you (buyer) determine what are you yourself willing to pay for a diamond"?

or #2. "How do you (seller) determine what are they (the buyers) willing to pay" ?

Otherwise, who are "they" in the question above

I don''t think I am in a good positon to answer #1 and totally not qualified for #2.

It is hard anyway. I wonder how many visitors of this site just ask "is this a good price". There is a number of threads like that adding up to some worthwile reference.

 

[fire&ice]

Date: 3/30/2005 9:10

8 AM
Author: valeria101

Date: 3/30/2005 7:12:36 AM
Author:Pricescope


The first question: How you determine the price they are willing to pay for a diamond?

I would need a bit of clarification about who ''you'' and ''they'' are in the question:

I''m a little confused as well. Is you - me the consumer? Is they - they the diamond vendor/jewelry store?

If so, then my answer is simple though complex. I would pay a fair price to maintain a good balance of service, quality & ease. I would not buy another Vatche setting at the premium keystone price they charge. I would have someone make me something similar for considerably less. The 3 stone w/ baguettes on the side isn''t something unique. That said, I would have one vendor do turn key even if cost was more (stone, setting & set). I saved money going to different sources - but it took longer & added unnecessary stress/work to my life.

 

[pricescope]

Date: 3/30/2005 9:46:52 AM
Author: fire&ice

Date: 3/30/2005 9:10

8 AM
Author: valeria101

Date: 3/30/2005 7:12:36 AM
Author:Pricescope



The first question: How you determine the price they are willing to pay for a diamond?

I would need a bit of clarification about who ''you'' and ''they'' are in the question:

I''m a little confused as well. Is you - me the consumer? Is they - they the diamond vendor/jewelry store?

If so, then my answer is simple though complex. I would pay a fair price to maintain a good balance of service, quality & ease. I would not buy another Vatche setting at the premium keystone price they charge. I would have someone make me something similar for considerably less. The 3 stone w/ baguettes on the side isn''t something unique. That said, I would have one vendor do turn key even if cost was more (stone, setting & set). I saved money going to different sources - but it took longer & added unnecessary stress/work to my life.

Sorry, made a typo. The question is "How you determine the price you are willing to pay for a diamond?"

 

[lizzyd]

My husband and I decided what our ring budget was first, then set out to find the "most" diamond for our buck ("most" meaning whatever combination of cut/size/color/clarity we determine is our sweet spot for quality/cost combination).

I discovered I can get way more for my money on-line.

I am not willing to pay a premium for things I cannot detect with the naked eye. For me, anything above an eye-clean SI1 will cost money I''d rather put into the carat weight. Ditto for anything above a true I color in a round brilliant.

I can select from a huge on-line inventory as compared to most local B&M inventories.

I find, in general, the good PS vendors have WAY more information about the stone one is considering than local B&M stores, and they are WAY more willing to share that information.

I am absolutely willing to pay more for generous return and upgrade policies. But even paying more for those perks with an on-line vendor (like Whiteflash), I''m still saving thousands compared to what a B&M would cost me for the same item.

I don''t find the lack of ability to compare side-by-side too much of a hinderance. The way I figure it, a diamond''s price is really set by what it''s grading certificate says, first and foremost. If that''s what I''m really paying for, then it''s a tremendous advantage to be able to scroll through the stones'' specs on-line, pick out the ones that fall within the parameters I''m willing to pay for, and then have my trusted on-line vendor (that''s the most crucial part), look at one or two or three of them with his or her own eyes and give me an honest opinion on the stones'' appearance. Then, the narrowed down field of one or two stones can be sent to an independent appraiser for me to view and at most, I''m out some postage, insurance and appraisal/consulting fee.

The education I have received from NiceIce''s website and Pricescope has made me a far more saavy diamond consumer. Now, when I walk into B&M stores and start asking intelligent questions, I always feel as though I''m scaring the sales people with my obvious knowledge (and I hardly know anything compared to most on PS). It doesn''t give me the confident feeling that doing business on-line with an experienced Graduate Gemologist does.

 

[Hest88]

For me, I start with a fixed budget of how much I can afford and then see how much diamond I can get for the budget I have. I might be willing to go a little over for the perfect diamond, but I pretty much stick to my allotted price point. If I find there''s no way to get something I''d like for the price I''m asking I''d save up a bit more.

I am willing to pay perhaps 10% or a couple hundred dollars more for good local service and convenience, but not much more than that. However, I''ve found that I can get good or better service with some of my favorite Internet jewelers PLUS they''re usually email savvy enough so I can do the transaction during the workday instead of having to wait until the evening or weekend. There''s a certain convenience to this scenario that can outweight the convenience of a local jeweler if I''m just buying a stone or simple setting.

 

[bar01]

Hmmmm..

Let’s see if I can give what you are looking for- First all sources (whether internet or local B&M) must be well known, reputable, and quality.

Price increase I would be willing to pay a good local B&M over a top quality internet based vendors – 10-15%.

Price I would be willing to pay for a quality internet E-vendor over lesser E-vendor – would not buy from e-vendor who was not top quality, had a name (either store name or person in charge had rep) and had lots of happy customers.

But as many have mentioned, price was not the main reason I headed to the net initially – it was selection, information, and custom process. Most stores wanted to sell me only what they had on hand, or used to selling, and weren’t interested in going out to get what I wanted.

Lastly, it seems as though there is such a blur between e-vendor and B&M. Many are both. In either case, it is important to know the individual people at each place.

 

[valeria101]

It is way easier to count than judge diamonds (especially that crytical first important purchase )...

I find it hard to believe many would start shopping by asking "how much this diamond costs" when it is so hard to tell which is what and a real tour de force to compare merchandise between sellers.

90% of shopping is probably done by the time one gets to ask "how much".

Unles... the question means a different thing: "How did you decide your diamond shopping budget"
When that''s decided, there is probably no diamond at hand - just an idea of how much "effort" is the respective desired thing worth in general. Obviously one must get some general idea what to expect for anything, including diamonds. Chances are, that information doesn''t even come from a jewelry shop. There are lots of stories here...

 

[amytude]

No offense here, but everyone''s answers are a little vague (that''s the teacher in me coming out). The question could have been phrased differently, but maybe they want specifics?? Here''s my process:

1. We were replacing our lost/stolen ring. DH & I decided on a budget.
2. Went immediately to net, not local B & M stores. Search and found tons of info about diamonds. Surfed many of the most popular sites (blue nile, mondera, union diamond). Discovered I would be buying a loose diamond.
3. Visited local B & M stores to see different shapes, clarity, color & cut. Quickly was disappointed with what B & M stores had in stock or could get compared to the net.
4. Decided on the shape of the diamond (EC for me) which approximately DOUBLED my budget. DH did not pass out and agreed to the price hike.
5. Decided I preferred to buy locally and spent 2 months looking at EC''s in B & M stores. Became frustrated b/c I was unable to find a stone meeting my qualifications in a B & M store. Finding a suitable cut was the biggest hurdle. I also preferred a 1.4-1.5 or greater length to width ratio. Many of the B & M stores could get in asschers or square EC''s but not the more rectangular ones.
6. Began looking at vendors here on priceline. Did a search and that same day found the stone I eventually ended up buying (DCD).
7. Decided I preferred to use credit card and paid the extra percentage for that service. It was worth it for my peace of mind.
8. Got the stone in and had it looked at from an independent appraiser.
9. Went back to one of the B & M stores I had visited when shopping for a loose diamond and I''m having them make my custom setting. Unless I had something simple, I still don''t think I''d do an online custom setting.

Does this info help? I preferred to buy locally to support the community, however, I wasn''t able to find a stone. Would I have paid 10% more? I guess that depends on the price. If the stone I was looking at was $2000 on the web and $2200 in the store, sure. It the stone was $10K on the web and $11K in the store, then no. Price IS a big factor for shopping online (for me). Anything over $500 is a significant savings to me. I would have only bought from PS vendors or other well established sites (like the ones mentioned above).

When we tried to figure out how much to spend, we didn''t use the 2 months salary rule or anything like that. I came up with a number that sounded good to both of us--One that we could easily afford. Then, after shopping (as mentioned above), we decided to spend more. I justified that b/c I don''t wear a lot of jewelry and this would be sort of a "purchase of a lifetime". Again, I hope this information is helpful.

 

[amytude]

I forgot to mention that back when I got engaged (1993), financing was REALLY important. Could this be a reason that folks shop at B & M stores vs. online? Even if you have a credit card to put it on, many stores will offer 12 mos same as cash. Although that doesn''t matter to us anymore, it sure as heck did when we were back in college and broke!

 

[Regular Guy]

It was Lisa''s fault.

Before proposing I did a pre-shop for an engagement ring, whetting the lips, and got something like 1/3 carat for my wife as a sort of a promise ring. Somehow, though, I got to talking to the German waitress who lived in my apartment complex. She said I''d be looking for 1 carat, right? That opened up my eyes.

Everything flowed from there. For my original e-ring, I sought out both good qualities in both the ring & jeweler, and paid then in excess of $3 K to get what I wanted. Fifteen years later, with the diamond gone missing, in the market mix again, I''d somewhere understood a savings could be had by hitting just below a carat, but the qualities of G & VS were still in mind. At that point, I sought both good cut...trying to nail it this time....and a market to provide it, where I could go forward. I started by a call to Lazare, and to the mall jeweler who could get it. With the number approaching $10 K, I sought again. Charles and Sons was much more encouraging, and earlier shopping brought them to my attention, and they thought they could find me a well cut diamond to with only over $5k. Another search on Google, on "ideal cut diamonds Washington DC" brought me to Pricescope, to a list of local vendors, and the rest is history...where I found that I could get what I wanted for just over $3K, going to DCD to get it. And...I felt I could go forward based on cash on hand.

 

[Mara]

Our original purchase was offline, but every subsequent purchase has been online since then. I prefer the level of information that is found online with certain vendors, that an offline jeweler can most often times not supply. Sure I can see the local stone with my eyes, but when you have a trustworthy online vendor who has proven themselves, they can be your eyes and you can use the numbers, reports, images etc to make the decision for yourself.

I determine pricing by using the online PS charts and using the PS search tool for pricing of similar stones...and figuring out what is the range to look within. Some offline jewelers will price match, but it is not just about price matching for me..the online stones I am interested in have a wealth of additional information AND better price than offline. Win win for me.

So for me, there is no real reason I would pay more offline for a diamond--well unless it was a brand only purchaseable locally and/or one with very consistent cutting standards (aka 8*). Jewelry may be different, but I would prefer to shop online for more information and better pricing. Diamonds are luxury purchases so for me, I need to get the most bang for my buck in order to justify the spend.

 

[aljdewey]

The first question: How you determine the price you are willing to pay for a diamond?

I assume this doesn't intend to ask "how did you set your budget", but more "how do you determine what a fair price is for any given stone?" My answer to that direct question is: I've determined what we would pay for my diamonds in two parts: 1) in a general sense by learning enough online to understand what factors affect price, and 2) when it came to making specific purchases, using Pricescope to find and price comparable stones from various *comparable* online vendors.....meaning those with inhouse inventory. (I considered it pointless to compare pricing on stones from drop-ship or virtual inventory because it's harder to secure cut information. To me, it's worth paying a bit more to get that information.)

How much above the web prices you're willing to pay for convenience to buy locally?
I'm unwilling to spend *any* more because I don't perceive local stores to truly be "more convenient".

Most local stores in my area don't carry more than a few AGS0 stones (if they even carry that!), so I'd have to wait anyway for them to bring in just one or two stones. Because I will only work with online vendors who have product inhouse, I can select stones today, get them set/shipped tomorrow, and have them in hand in less than 48 hours. It's taken the local guys more time than that just to bring in stones for me to consider. That's not more convenient to me.

As I see it, a CD or a pair of shoes is more likely to be an *impulse* purchase; the price point of diamonds tend to make them purchases I anticipate at least a little in advance. As such, it's hard to imagine many situations where I'd need a diamond more immediately than 48 hours, so again, convenience doesn't come into play at all.

Even if the local vendor brings in two stones, my choices are "vanilla or chocolate"....one or the other, not the several choices that a vendor like WF, DI, GOG, etc. possess.

I'm unwilling sacrifice a wider selection just to shop locally. Honestly, as it stands today, I'd be more willing to pay the higher price to the online vendor than the local guy because I can get *everything* I want from the online vendor.....selection, documentation, service, and better turn-around time.

What if a local vendor *could* provide me with all these things? Then, I'd possibly pay a bit more, but not in the name of convenience. It would be to support a local business, which in turn helps defray my tax burden in my community.

I'm going to say that I don't think price is the primary factory when people shop for diamonds. I think the primary concern is "value for the money", Leonid. People don't usually come here asking "is $3000 a reasonable price for *a* diamond?"....it's usually "is THIS diamond I bought worth the $3k I paid?" The question really is, did I get value for my dollars?

It's the thing that drives the research freaks like Mara and myself to the internet to learn enough about diamonds to get a sense for value....what is a reasonable price to pay for Diamond X given this color, this make, this clarity, etc.

People who buy online still might prefer to pay extra for the piece of mind and buy from well established companies like Blue Nile or Diamond.com. How much more do you think is fair to pay for the well established internet brand?

I'd say 5-10% easily. For the non-research freaks, I think well established does mean Blue Nile, Diamond.com, etc. To those of us research freaks, I think our definition of "well established internet brand" is a bit broader and includes the oft-recommended vendors here.

Most people (I think 95%) are still buying from local stores even if they research the subject online.

That's true today, but I think it will less and less true as time goes by. I believe the biggest reasons more people don't buy online are 1) fear of getting duped on such a major purchase, and 2) not wanting to appear imprudent to family/friends by making such a major purchase with an "unknown" entity.

When my (now) hubby and I first talked about diamonds, we were ADAMANT that we wouldn't buy online, because how could you know who was above board and who wasn't? How could you separate the risky transaction from the low-risk transaction on such a major purchase? The answer, for us, was education.....learning about the product and, in turn, vendors we COULD trust. I think a lot of it was a year of exposure to these folks on PS, slowly gaining our confidence through stories of many others' successful purchases.

Now I've made five successful purchases from online vendors, and my sharing those experiences with people I know has led to two other purchases made online.....friends who would NEVER have bought online if it weren't for my stories. As it becomes more common and more folks who know someone who did it, the comfort level with the idea of online purchasing will increase, and I really believe you'll see that 95% decrease.

 

[Dancing Fire]

1. i''m not willing to pay my local store a penny more for what i can buy over the internet,for the same quality stone. it''s B.S. to me about supporting the local guy,i rather support my own kids then his. is this local guy gonna pay for my daughter''s jean,sneakers,school books,etc...when my bill is due ? "hell no"


2. as for what i''m willing to pay.....i always ask the vendor,what is RAP on the stone and decide from there.i know,i know, don''t fall into the rap trap.dealers tell you don''t buy diamond base on rap ,in some case that''s true there are stones on E-bay selling for 30-40% back of rap that i wouldn''t even touch because of poor cut quality.on teh other hand i wouldn''t pay 20% over rap for any stone.

 

[coda72]

Date: 3/30/2005 7:12:36 AM
Author:Pricescope


People who buy online still might prefer to pay extra for the piece of mind and buy from well established companies like Blue Nile or Diamond.com. How much more do you think is fair to pay for the well established internet brand?

I would like to answer one part of this question since I did buy my diamond from Diamond.com. I went on price and specs of the diamond for my purchase and quite simply they had the cheapest price on the diamond I wanted. I know some people around here criticize Blue Nile and Diamond.com because they think the prices are higher, but in this case that just wasn''t true. I got an extremely good deal on a great diamond, and for once they had it in house. It wasn''t a diamond that every other website also had. Another thing I liked about my purchase is that I didn''t have to pay extra for my ring size being a size 4. At least one other well known web vendor that''s constantly praised on here charges extra for sizes 4 and smaller. It''s not fair to penalize people with small fingers. So, in actuality I think you can get a good price no matter which web vendor you are using. You just have to do the research.