New Zealand jewellery company 1791 Diamonds has already exported $7.5 million of design engagement rings to places like Asia, Europe and USA.
However, the Wanaka-born online company has bigger ambitions and wants to delve deeper into the Northern Hemisphere.
It’s using New Zealand based crowdfunding company Snowball Effect to raise $750,000 – in exchange for 14 to 30 percent equity in the company.
Investments over $2500 will receive a piece of jewellery.
Richard Prout, a British-born entrepreneur, is the technical brains behind the company, while another Pom-turned-Kiwi, jewellery designer Alice Herald, is the creative mind.
Prout’s last two tech start ups, Kinesis and Smart-Groups, sold for over $NZ120 million.
His mathematical and programming skills have come in handy on this latest project, as he created 1791 Diamond’s advertising algorithms.
Prout says the company has mastered its digital ad spend, to the point where every dollar they spend in adwords in the UK, the company gets back five dollars in revenue within six weeks.
He says the custom-built advertising system can specify the demographics and geographical suburbs it wants to target, as well as get the specific time of day.
This allows the company to target customers who have a high disposable income and want to get engaged, but can’t get to a bricks and mortar store, like an oil rig worker.
“We get extremely consistent returns over a wide demographic, from people who are remotely located due to work, as well as the CBD workers age ranging from 20 to 35,” Prout says.
Prout says the capital raised through crowdfunding will go towards its digital marketing budget and offshore expansion as they penetrate the US and UK markets further.
“The Northern Hemisphere market is critical in our expansion plans as it allows us to sell through two engagement seasons,” he says.
The company first launched in 2008 amidst the global financial crisis.
He says consumer confidence being at an all-time low forced 1791 Diamonds to up its game.
The company has grown exponentially in revenue since its launch and now typically sells over $120,000 worth of rings a month with a gross profit of 36 percent.
And that’s against a background of worldwide gloom in jewellery retailing.
Forbes reported that the demand for gold jewellery has dropped 30 percent since last year, and diamond company De Beers said in its 2014 Insight Report that “retailers have faced pressures from a weak economic environment and strong competition from branded luxury goods and experiential categories, as well as the low-price models of ecommerce companies.”
However, 1791 Jewellery isn’t a low-priced model.
Its custom-designed range starts at $350, with the odd individual sale reaching $150,000.
Prout says consumers are embracing online shopping in a big way – even with expensive items like an engagement ring.
He says the online jewellery market has grown at 25 percent per annum.
“It has evolved to the point that we can now offer a superior level of service than bricks and mortar retailers,” Prout says.
“We have a range of online tools that allow us to interact with our customers and custom design engagement rings wherever they are in the world.”
Prout says over $1 billion worth of engagement rings were purchased online in the US in 2014, with 85 percent of people buying engagement rings being under 35.
1791’s crowdfunding campaign has raised $183,300 so far, or 24 percent of the company’s target.
The campaign has 25 days left to go.