Professional Jeweler Archive: What's Up in the B-to-B Online Marketplace?

October 2004

Trend Spotting


What's Up in the B-to-B Online Marketplace?

The two biggest players are IDEX and Polygon


With diamond shortages and consumer Web sites changing the way diamonds are sold at the retail and wholesale levels, many retailers are looking with interest at Web sites where diamond trading is conducted.

They hope these sites might give them new access to supply, plus a Web-based means to impress their customers with an extensive virtual diamond inventory.

Here’s some news about two major online resources that neither buy nor sell diamonds themselves, but instead provide a neutral platform you can use as a network or exchange to buy and sell with others.

IDEX

IDEX CEO Ehud Cohen’s idea was to create one vast real-time, virtual bourse where diamond dealers and clients from trading centers around the world could buy and sell. A second generation diamond dealer based in Israel, Cohen believed such an exchange could facilitate global diamond sales while it stayed out of the business of buying and selling itself.

Today, Cohen says more than 75% of the total global diamond trade is on IDEX. Any member of a diamond bourse can join, as can a jeweler with a listing in the Jewelers Board of Trade’s Red Book and references. At the JCK Show in June, IDEX introduced an upgraded platform that offers diamond market monitors reflecting demand and supply trends in real time. The information is derived from IDEX’s database.


The home page of the IDEX Web site.

Members can use the IDEX Diamond Trading Floor, which displays the inventories of major companies from the global market worth $500 million. Buyers can search for singles, parcels, pairs or sets. In addition, the trading floor features thousands of real-time demands for diamonds at any given moment. Or diamantaires can create a company site on IDEX and restrict access to their diamonds or jewelry, allowing only known customers to have logins to the information.

Members also have access to its newsroom and special features written by diamond expert Chaim Even-Zohar, whose print magazine IDEX bought and now publishes. There also are new jewelry showrooms where members can create private jewelry catalogs that link customers to their own Web sites. Forums and other means to facilitate talk between buyers and sellers are included.

A new graphic design this year allows members to link to an online directory of all IDEX members, an ever-changing newsfeed, links to industry-related Web sites and an animated guided tour for new visitors to get acquainted with the site.

  • www.idexonline.com.

– by Peggy Jo Donahue


Polygon

In early September, Mediagrif Interactive Technologies, an Internet commerce company in Montreal, Quebec, Canada, acquired PolyGroup Ltd., the jewelry industry’s oldest Internet business network. Polygroup is the parent of the Polygon interactive jewelry talk, sales and information site in Golden CO. The total acquisition price is about $8.4 million in cash. This fiscal year, PolyGroup earned about $3.5 million and is profitable.

“We are excited PolyGroup has become part of the Mediagrif team,” says PolyGroup CEO and founder Jacques Voorhees. He and his staff are well-known figures in the jewelry industry, often appearing at trade shows and as sources for jewelers working with e-commerce issues. Many consider Voorhees the pioneer Internet guru for the jewelry industry.

The Polygon home page (top) and another page explain how users can benefit from Web-based communication.

Voorhees told Professional Jeweler the purchase will allow Polygon to deliver enhancements much more quickly.

“Polygon had four Java developers. Mediagrif has 65,” he says. “Twenty of those are at work rewriting the Polygon software so it operates on their platforms. The New Polygon will be released in late January. And once it’s part of the Mediagrif platform, it will be vastly more content-rich, stable and easy to use.”

Voorhees and Krista Olsen, Polygon marketing director, will retain their positions in the company, which will move its headquarters to Montreal during a four-month transition. The largely outsourced technical team and its accounting division in Colorado will be laid off.

“Think of it as a car manufacturer who was building cars out of his garage suddenly being acquired by General Motors. That’s what has just happened to us,” says Voorhees. He adds that his customers will benefit from the sale because of the enhanced site and by 24-hour customer service.

About 3,000 subscribers use Polygon to buy and sell diamonds, watches, colored gemstones and finished jewelry. Polygon also offers over $1.6 billion of diamond inventory from about 500 diamond wholesalers.

In operation since 1984, Polygon estimates trading activity to be millions of dollars per day. The wholesale diamond database is know as CertNet, with over 100,000 diamonds listed. Retailers can use the database at the counter with their customers as a selling tool.

In addition, Polygon has buy/sell channels where members post requests for items they need. Other members vie for their business by responding to the requests. Suppliers can use the sell channels to move specialty goods and overstocks. Because of the open-market formats, members say they can buy at submarket prices.

Polygon is also known for its discussion channels, where members can speak out on the topics of the day in the jewelry industry. They also exchange tips on business practices, promotions, personnel, digital photography, bench techniques, insurance and computer systems.

  • www.polygon.net

– by Michael Thompson

Copyright © 2004 by Bond Communications