Online jewelry retailer JamesAllen.com has raised $140 million in private equity funding to fuel expansion.
The funds from Francisco Partners “will allow us to continue to test, innovate and apply new technologies,” says Oded Edelman, CEO and co-founder of wholesaler R2Net LLC, which owns James Allen. “This includes enhanced product visualization technologies, new distribution formats and an expanded product range.”
The jeweler’s virtual showroom “allows consumers to feel like they are holding the diamond in their hands and lets you inspect your exact diamond from every angle,” said Neil Tolaney, head of consumer internet investing at Francisco Partners, in announcing the funding last week. “You get an even better look with the JamesAllen.com imagery than you would in person.”
In the past few years, the retailer has invested in several technologies for its e-commerce site. For example, James Allen developed a 360-degree image technology that uses rapidly moving images to make a ring appear like it is spinning, so a shopper can see it from all angles. The diamonds are also photographed at 15 times or greater magnification so shoppers can see all aspects of each diamond—the shape, color, clarity and cut–as well as any flaws.
On its mobile site and mobile app, JamesAllen.com also has a virtual try-on feature that allows consumers to photograph their hand and place the ring of their choice on their finger to see how it looks.
James Allen is No. 248 in the Internet Retailer 2016 Top 500 Guide. Internet Retailer estimates the merchant generated $288.0 million in online sales last year—up 50% from $192 million in 2015. The retailer sells almost exclusively online with the exception of one showroom in New York City. Web sales have tripled in the past two years, Edelman says.
“JamesAllen.com has experienced a tremendous amount of growth in the last two years,” he says. “We recently helped our 150,000th couple design their dream ring.”
James Allen credits much its recent success with its ability to appeal to the millennial generation (roughly consumers age 35 and younger) in ways its competitors haven’t yet mastered.
The e-retailer also is well-positioned to sustain this growth in the future, says chief marketing officer Johanna Tzur, because a typical James Allen’s customer, after he buys an engagement ring, tends to return for wedding bands and anniversary gifts once he’s had a positive experience on JamesAllen.com.
“We have some confidence that we’ll continue to grow,” Tzur says, “[Our target customer group] is a whole generation of consumers that will not have ever really spent time buying in the traditional ways that other generations have.”