Choosing to whether to extend your brand is a complex decision and one which must be considered extensively and executed strategically. One company that decided to take the leap is family jewellery business Definitive Diamonds. Maxwell Richards began the company formation process in 1980 and in today’s post we talk to his son, business owner John Richards, and ask him why they decided to do it, how they extended and if it was successful.
Originally, Definitive Diamonds was a diamond wholesaler business which imported diamonds and sold them to jewellers up and down the UK. However, as the market changed many of the jewellers they sold to recognised that they could minimise cost by going direct. As a consequence, while the company retained a loyal customer base, if it was to grow it would need to use its established brand as platform to extend into other areas. CEO and founder John Richards, decided to take action. It was decided that while they would retain their core diamond wholesale business, Definitive Diamonds would open a chain of retail jewellery stores across the south of England where customers could select their own diamond and create a bespoke design.
“We could use our existing contacts and industry experience to a create a new offering in the sector. And the equity of our current brand meant that the risks of entering the notoriously difficult retail sector, were dramatically reduced” comments Richards.
As Definitive Diamonds was entering the established sector of retail, it was important that they conducted some comprehensive market and customer research.
Richards states “Before we established what our new proposition would be, we knew it was important to understand how we would be positioned against our competitors in the retail sector and establish what elements of our core brand would work and which would not.”
“We conducted some qualitative research and found a gap in the market for people looking to design their own diamond rings. At first we launched on a small scale, using our reputation and relationship with existing retail outlets to sell the proposition, once we established the popularity and commercial potential, we opened a small chain of high street outlets.”
Was it a success?
For Definitive Diamonds, and its brand extension Designer Diamonds, it has been a resounding success. They have opened three more stores and are launching an e-commerce site where users will be able to choose their diamond and design online, next year.
“Extending our brand allowed us to retain our brand value and equity and opened us up to a different and larger market ensuring that a company formed over thirty years ago remains relevant and commercially viable in the contemporary industry.”