In the two years since Blue Nile sold to Bain Capital Private Equity and Bow Street LLC for $500 million — removing it from the stock market — the Seattle-based online jewelry retailer has remade its leadership team, streamlined its supply chain and jumpstarted its revenue growth. These moves all set the stage for the company to eventually go public once again.
“Our expectation is that we will tap back into the public markets, probably not in 2019, but if we continue to execute on our journey, I think you could see it happening some time after that,” said Bill Koefoed, Blue Nile’s CFO, in an interview with GeekWire.
Koefoed is one of those new executives, joining the company in March. He ran investor relations for seven years at Microsoft, so he’s familiar with public companies. He also spent time as CFO of Skype inside Microsoft and CFO of Puppet, the Portland-based software automation and infrastructure management company.
Blue Nile brought in former Target e-commerce chief Jason Goldberger to be its CEO in the summer of 2017. Chief Product Officer Dave Fleischman came over from Expedia last October, where he was vice president of global product. In March, Blue Nile brought in Katie Zimmerman from Zales to be its chief merchandising officer.
Blue Nile, co-founded by entrepreneur and investor Mark Vadon in 1999, was an e-commerce pioneer. It went public in 2004 and weathered the recession. But in the years prior to its acquisition, sales began to decline.
With a new executive team in place, Koefoed says Blue Nile has boosted its revenue growth and profitability. Prior to the acquisition, Blue Nile was bringing in about $400 million in revenue per year. In the last year it cleared $500 million in revenue.
Koefoed said Blue Nile overhauled its supply chain, cutting off multiple layers of middlemen, and building tighter relationships with manufacturers. This helped reduce supply costs and boost the company’s bottom line.
“We’ve gone directly to the vendors who produce the goods, and that’s certainly helped our profitability,” Koefoed said.
Today, Blue Nile has about 500 people in total, most of them based in Seattle. That figure is up by about 100 over two years ago.
Though e-commerce has taken over many types of shopping, jewelry remains a brick-and-mortar business, Koefoed says. Blue Nile is trying to change that, and a big part of the plan relies on technology.
Today, customers can visualize diamonds on Blue Nile’s site, zoom in and out and rotate 360 degrees. Koefoed imagines using images of the customer’s hand and projecting a diamond on to them.
Though Blue Nile is primarily focused on e-commerce, it has six brick-and-mortar locations in malls in Bellevue, Wash.; Portland; Tyson’s Corner, Va.; Salem N.H.; and White Plains and Garden City, N.Y. These are not typical stores, as you can’t actually buy jewelry there. They are showrooms for the products Blue Nile sells online, giving customers a chance to try them out before purchasing digitally.
Koefoed said the company doesn’t plan to open any new stores in the coming year. However, it is looking at its current locations, as malls aren’t exactly the hotspots they used to be.
“We’re not entirely sure that our existing locations are all in the right location, and we are continuing to look to explore what a future omni-channel presence will look like going into the future,” Koefoed said. “I don’t expect that we are going to be opening any new stores in 2019, but I do expect that we’re going to double down on our efforts to determine and test what the best experience is going to be for our customers.”