A business with a rich heritage in the industry dating back six generations doesn’t get rattled easily by emerging competition. New players come. They go. Sometimes they throw a wrench into the mix with lowball pricing.
How do you respond? CO— put the question to Danny Gavin, vice president and director of marketing at Brian Gavin Diamonds, the Houston-based jeweler whose beginnings trace back to the family’s diamond factory in South Africa. Gavin is also founder and chief strategist at digital marketing agency Optidge and serves as adjunct professor at the University of Houston’s Bauer College of Business with a focus on search engine and social media marketing.
When Gavin saw new online players pushing low price, he considered three options for the business, which sells precision-cut diamonds and jewelry via its website and showroom near Houston’s upscale Galleria mall:
- slash prices to maintain market share
- introduce a low-end product to compete on price
- introduce a high-end product to further elevate the brand
Introducing a lower-end product would not only be detrimental to our brand but would also not be the long-term answer.
Danny Gavin, Brian Gavin Diamonds
The third option was a risky move, Gavin said, because it could alienate customers, erode market share and cannibalize other brands at the company.
Still, he recognized that a knee-jerk response to market movements – racing to the bottom on price – was not the way to go. A better move was to build on the company’s strengths and its founder’s stellar reputation as a master diamond cutter. The elder Gavin collaborated with his father to research and develop a grading standards system for a precision diamond cut known as “Hearts and Arrows.”
“We felt that introducing a lower-end product or lowering prices would not only be detrimental to our brand but would also not be the long-term answer,” Danny Gavin told CO—. “So we moved in the opposite direction and introduced our Black by Brian Gavin line, which is based on a proprietary patent pending cutting technique.”
Response to the pricier new line of diamonds was “remarkable,” he said. The high-end collection is never discounted and when the retailer runs special offers, the Black brand is off limits. Demand for the line grows, and the company has grown, too, Gavin said.
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