Building a brand can be easy if you're BMW or Mercedes. But what if you're selling a commodity with subtle qualities that ordinary consumers can't easily recognize?
That's a problem Glenn Rothmann faced in 1996 when he created Di-Star Ltd. Last year, the Boston-based company became Hearts on Fire. It cuts and distributes "branded" diamonds to some 350 jewelers nationwide.
Last year's sales: $30 million. For 2000, Mr. Rothmann says he's on track for $50 million. His diamond cuts have won the American Gem Society's highest rating.
The Monitor's Eric C. Evarts chatted with him about the need for brands and how he created one.
Information is good for consumers, because consumers ultimately squeeze the best price out of a commodity. But ... now consumers need to go out and educate themselves.
"In buying something like a diamond, which most consumers feel is a pretty blind item, there [also] has to be some empathy or trust.
"That's where branding comes in. Branding will guarantee a specific quality.
"In our case, we guarantee the most sparkle. It gets independently verified and it hasn't been challenged by anybody in our industry.
"The product has to be easily differentiable to the end buyer.
"Consumers are very smart, and they will not overpay for just flat-out name. They pay for differentiation, for something that is real, for value.
"Now we felt without the differentiation all you would be doing is slapping a name on a commodity -[which] will fail every time.
"So you start with the product. Then you develop a program around it.
"Every Hearts on Fire diamond comes with special packaging, a suede portfolio, and a certificate from an independent laboratory. And the diamond gets inscribed with a [microscopic] serial number.
"We've 'decommoditized' diamonds by empowering the consumer to see the difference. Using a special jewelers' tool, called the proportion scope, they see the symmetry with their own eyes. We've taken the fear out of the purchase.
"The key element to a successful brand is creating passion - it's a very powerful motivating force."
(c) Copyright 2000. The Christian Science Publishing Society