Blue Nile Reviews

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★★★☆☆
3 stars out of 5

Bottom Line

Blue Nile is the largest and most well known internet diamond seller, but their business model has drawbacks. The inability to see their diamonds forces you to pay more for unnecessary upgrades in color and clarity to insure you don’t get stuck with an ugly stone.

Depending on what you are looking for, you can get more for your money on a site like James Allen or Brian Gavin Diamonds that has high quality images of their diamonds that allow you to cherry-pick the best diamonds with SI1 and SI2 clarity grades that will be “eye-clean,” thereby saving you money.

It’s best to contact us so we can evaluate your individual case and advise you as to which vendor offers you the best value.

The History

Bluenile.com was founded in 1999 by Mark Vadon.  The story goes that around that time Mr. Vadon was shopping for an engagement ring and was fed up with his options.

He felt that diamonds were essentially a commodity, and that all he needed to do was learn about this commodity and then shop for the best price.

He discovered a site online called internetdiamonds.com and was intrigued.  He contacted the owner, formed a partnership, and shopped around his idea to the venture capital circuit.  The rest, as they say, is history.

The Facts

Blue Nile’s business model (speaking now only of their engagement ring business which is overwhelmingly their primary source of revenue) is a fairly simple one.

Blue Nile signs exclusivity agreements with diamond wholesalers all over the world that stipulate that these wholesalers can only list their diamonds on Blue Nile and no other online retail site.

The reasons for the exclusivity are simple – Blue Nile doesn’t want their customers comparing prices for the same stone that they’ll find on 3 other sites, and they also want to maintain an edge over their competition in terms of how many diamonds they list as their own at any given time.

Worldwide Inventory

Figure 1 – The Invoice – Click to Enlarge

Blue Nile takes lists of diamonds from their vendors and uploads them into their database and lists them for sale on the website.

Since these diamonds are located all over the world, mounting & shipping times can vary depending where the stone is being sourced from.

Outsourcing Opinions

Based on my personal experience with Blue Nile conducting research for this article in 2011, it appeared that they (at least occasionally) didn’t use their own people to mount the diamonds into settings – the setting work appeared to be contracted out. After speaking to some insiders more recently, however, this no longer seems to be the case.

People report that they can call Blue Nile and ask them to inspect diamonds listed on their site to get gemologists’ reports about whether or not a specific stone is eye-clean.

It would appear that all that Blue Nile’s gemologists do in such a case is call the specific vendor who owns the diamond in question and ask them for their opinion of the diamond. I believe this is still the case, since Blue Nile will only take possession of a diamond for mounting after it has been ordered.

Biased Perspectives

The flaw in the system is that since each vendor is motivated to sell his diamond over his competition’s, he’s always going to push his own stones.

From the vendor’s perspective, the worst that can happen is the customer won’t be happy and he’ll return it – but if the vendor doesn’t push his stone, he knows he won’t stand a chance of closing the sale.

Figure 2 – The Packaging – Click to Enlarge

The Test

For purposes of this review, I ordered an engagement ring from Blue Nile using a pseudonym.

Figure 1 is a copy of my invoice.  As you can see in the invoice, I ordered a 1.01 carat J color SI2 clarity diamond mounted in a simple solitaire engagement ring setting.  I couldn’t find any Blue Nile coupon code, so I bought it as is.

Since I’ve already reviewed Blue Nile’s customer support in my Diamond Earrings Review article, I decided this time to place the order online. Their check-out system was very elegant and easy to use.

The Package

Blue Nile’s packaging was average at best.  See Figures 2 & 3. They ship the ring in a custom-made brown cardboard box with a special cutout in the center for the jewelry box which contains the actual ring.

On top of this is a blue paper envelope with the various documents accompanying the purchase (invoice, appraisal, and diamond certificate). In Figure 3, you can see the actual jewelry box removed from its cover.

First Impressions

I feel that if you’re paying several thousand dollars for a product, you shouldn’t open up the shipping box and see your jewelry box perched in the middle of brown cardboard.

Your initial impression of the importance of a package is how well it is wrapped and presented, and this presentation does not befit the significance of this purchase.

Figure 3 – The Packaging – Click to Enlarge

The Product

As you can see in my articles on color and clarity, the best value for a round diamond set in a solitaire setting can be achieved by going for a J color diamond and a clarity grade as low as possible that’s clean to the naked eye.

Since with Blue Nile, it’s not possible to review a magnified picture of the actual diamond, I couldn’t choose a clarity grade that would be too low (like an I1), otherwise it would be unfairly likely to have eye visible inclusions.

Compared to Others

On other sites that have pictures (such as James Allen, Zoara, and Brian Gavin Diamonds), you can shop around and cherry pick the one I1 clarity diamond that is still clean to the naked eye.

On Blue Nile, however, that’s not possible.  Therefore, I decided to go with an SI2 Clarity Diamond since most of these are eye clean and this is usually where you find the best mix of value and visual appearance.

As for how I chose this specific stone, I did what I felt most Blue Nile customers would do – I selected the cheapest Ideal Cut J SI2 1 carat stone they had available.

The Diamond

Figure 4 – The Diamond – Click to Enlarge

Figures 4 and 5 are images of the diamond itself and the GIA certificate, respectively.

As you can see in Figure 4, this stone has an easily noticeable icy white inclusion in the center of the stone.

Hidden Elements

This inclusion was easily visible to the naked eye from the very moment the lid was lifted from its presentation box.

This is not a stone I would ever recommend, regardless of budget, but I didn’t have the option of seeing a magnified picture in advance to rule it out.

My Impressions

My research for this article exposes several problems with Blue Nile’s business model.  Remember, that the very founding of the company was based on Mark Vadon’s premise that diamonds are a commodity.

The definition of a commodity is that all you need to know is its price to make a purchasing decision (ie, a bar of gold is a bar of gold and a bushel of wheat is a bushel of wheat – the only variables are quantity and price).

But can diamonds really be evaluated by price alone? Yes, it’s true that if you’re dealing with VVS clarity round ideal cut diamonds, then all you really need is the diamond’s price to figure out if it’s a good deal or not.

The Importance of Evaluation

But for just about every other category of diamond, that just isn’t the case.  You need to see at least a photograph of the diamond to evaluate its cut (primarily in the case of fancy shapes) and, just as importantly, to evaluate the diamond’s clarity.

Blue Nile treats SI2 clarity Oval Cut diamonds just as they do Flawless Ideal Cut Round diamonds.

Anybody with any experience in the diamond business knows that this is absurd since the vast majority of Oval cut diamonds are very poorly cut and there’s no way of identifying the nice ones using a certificate alone – not to mention the problem of potentially ugly eye visible inclusions.

Preventing Disappointments

Figure 5 – The Cert – Click to Enlarge

If I had tried to order this same stone from a vendor with magnified pictures of their diamonds, I wouldn’t make the mistake of ordering this stone because I could see very easily in the picture that the stone has a noticeable inclusion dead center.

Unrealistic Appraisals

And that brings me to my final concern about Blue Nile: Their appraisal lacked credibility.

Figure 6 – The Appraisal – Click to Enlarge

My total bill for the ring at Blue Nile was $4262. For comparison’s sake, for my review of James Allen, I ordered a very similar diamond and ring (almost identical on paper, but far superior in actual quality).

My total bill from James Allen was $3994. Blue Nile appraised their ring at a value of $7800 while James Allen appraised their ring for $5600.

The purpose of the appraisal is to let the insurance company know what a full retail replacement value of the ring is.

The Pros and Cons of Higher Appraisals

You want a higher appraisal than what you paid because it’ll make your life easier if it gets lost or stolen and needs to be replaced. But you don’t want too high of an appraisal because then that’s just going to make your insurance premiums needlessly higher.

In my opinion, Blue Nile is going way overboard.

Confronting the Situation

When I questioned a customer service agent about the size of the appraisal, her response was somewhat surprising. She said to me,

there is no right or wrong when it comes to appraisals. An appraisal can be anything. This is what the person felt the ring was worth. Many companies will tell you that they’ll appraise the ring for double of what they sell it for. Our appraisal isn’t even that bad. You’re welcome to get it appraised again, if you wish, to a number more to your liking.”

The Conclusion

Blue Nile is clearly a powerhouse of a company. They are the leader in online diamond sales. Nobody can compete with them when it comes to the size of their inventory of loose diamonds, and nobody has nearly as deep of an inventory of engagement ring settings.

It happens often that readers will contact me saying they want to buy a diamond at one place or another (not Blue Nile), but they feel they have to buy from Blue Nile because they’re the only ones who sell the particular ring they want.

In that regard, they are very much in tune with the likes and dislikes of the bulk of diamond consumers out there. But aside from those two points, there are a number of problems with Blue Nile as I detailed in this article.

Summary

  • Blue Nile doesn’t have pictures of their diamonds. This means you can’t reliably evaluate cut and clarity before you buy.
  • Blue Nile doesn’t have physical access to the diamonds in their “inventory.” So when you ask for a stone to be examined by a gemologist, all they do is call the stone’s owner and ask their opinion from afar. A diamond’s owner can’t be trusted to give an objective opinion since they want to push their stone over a competitors.
  • Blue Nile’s high appraisals cost you more money through higher insurance premiums. Blue Nile gemologists sign off on these appraisals even though they, at least in my case, never actually see the rings themselves.
  • In my opinion, Blue Nile’s packaging is low-budget and cheap looking.

Reviewed By: Michael Fried


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159 Comments

  1. Bob     Reply

    You can ask them for a close up of the diamond before you purchase it and they will give it to you.

    So… fail?

    • Mike     Reply

      Hi Bob,

      Their customer service has improved dramatically over the last year or so and we are updating our review. But the fact that you received photos does not solve the issue.

      1) I secret shopped them two weeks ago and was unable to get photos of all the diamonds (I asked for photos for two diamonds and after two days received only one).

      2) The way you select an SI diamond is by pouring through volumes of photos. When I pick a diamond from a site with photos, I generally need to go through 25-30 SI2 diamonds to find the eye-clean one. The photo is the first step, not the last step. Being able to ask for a photo is nice, but it doesn’t help you select a diamond effectively.

      That said, Blue Nile is a great company and often you can find excellent value there. Given their current margins, you can often find a VVS diamond that is competitively priced compared to SIs from some other companies. It all depends on the specifics of what our reader is looking for. We often recommend Blue Nile.

  2. Lana     Reply

    But what do you think about their non-diamond jewelry? I want to buy a gold+platinum wedding ring and I can’t find it anywhere else, I like their designs a lot. But after reading so many bad reviews about their diamonds I don’t know if I’ll waste my miney buying gold+platinum ring without a diamond.

    • Mike     Reply

      We like their jewelry a lot in general. The issues we generally raise had to do with sourcing the diamond.

  3. Mohamed Moshrif     Reply

    I was trying to buy a diamond ring for my engagement and I was planning to send it to my brother in law in Dubai because I live in China which would cost me much more in duties fees.
    The first problem I encountered, is that blue nile doesn’t do home delivery in Dubai and that someone needs to go pick up, no problem, except that they don’t have anyway on their website to actually edit the shipping info and they force you to use the billing info for the name of the person who needs to pick up the ring
    So I placed the order, then called (international call) to the customer service to edit the name (since the local number is only in Chinese and I don’t speak it), and they told me everything is good.
    At that point, I actually showed the photo of the ring to my gf and her family and everyone was happy with it, then later on, I received an email from blue nile to call them again because they need some info before they can proceed with the order.

    I called (twice) to their international number in US, first time they placed me on hold and then I was told to leave a message which I did and no one called back, so I called again and I talked with a very rude representative who basically literally told me: “there have been a business decision not to accept any credit card payments from you, and yes, specifically you!”
    And that the only way to proceed, is for me to do payment via wire transfer, which is basically the kind of payment that gives you ZERO guarantee against scam because you can’t dispute it in case they just decided not to send you anything!!

    Basically, STAY AWAY from them and don’t waste your time in that place!!

  4. sandyRED     Reply

    Buy diamonds at Costco — they stand behind their products

  5. Jason     Reply

    If I could give a lower rating I would. Personally my wife and I were pretty impressed with the price, seemingly great quality, and decent customer service…. However, if it seems too good to be true, it probably is.

    My wife is a kindergarten teacher and is very careful with her jewelry. After only a few years she has had numerous issues with her ring. The latest issue being a cracked center diamond and a side diamond falling out the same day we sent the ring in to be inspected and repaired.

    Obviously, upset and shocked at the diamond ring literary deteriorating in front of us, I contacted customer service. What I was told from customer service when I said I expected more from an expensive piece of jewelry was; ” Well sir, a diamond ring can crack from a simple tap. Maybe your wife hit her ring on a kids pencil box, or maybe she hit it on her steering wheel and bent the ring out of round causing the diamond to come out of the setting and crack”…..what……My wife is a kindergarten teacher not a construction worker.

    It seemed like I heard every excuse possible to put the blame on my wife for cracking the diamond. When I asked Blue Nile if there could have been an issue with the diamond during the setting process, of course, they said no. Or, if there could have been an issue with the diamond that was missed at inspection, again… no.

    After several discussions with customer service, I was eventually told the diamond would have to be re-cut and we would lose half a carat by the time everything was said and done. Blue Nile of course was not going to cover replacing the center diamond and was going to do everything to put the blame on my wife. After speaking with my wife, we decided it was our only option. We were told by a representative that the cutting process was going to be 300.00 dollars. I was shocked that Blue Nile was not going to cover the cost of the repair. (Also, they do not do any cutting in house. At this point, my wife’s diamond ring is at some unknown cutter) My diamond was now worth significantly less, the size was going to be significantly less, and now they want me to pay additional fees.

    After emailing back and forth to a representative about what I thought would be a fair solution emails stopped. My ring was still at Blue Nile and a resolution was nowhere to be found. I then had to contact Meg, a supervisor to discuss my options. She initially told me that there was nothing they could do and would happily send my ring back to me. I explained my situation once more. Letting her know, I contacted several insurance companies and jewelers to see if this was in fact a common occurrence. I was told by both the insurance companies and jewelers that this is very unheard of and typically happens many years later. Meg told me this does happen and in fact recently happened to someone after one month of purchasing a ring from Blue Nile… I tried to express my concern and felt that after purchasing my wife’s wedding ring, band, and my wedding band, that Blue Nile would do more for a customer that has invested thousands of dollars with them. At this point she said, “we can give you a 10% discount (30.00 off)”. It shocked me that the most Blue Nile cared to offer was $30.00. (New customers can find bigger discounts for Blue Nile online.) I asked Meg to please look into this further. The next day, she called and said we can offer you $50.00 off. $50.00 is what I and my situation are worth to Blue Nile.

    This is an eye opening experience and I personally will never buy from Blue Nile again. As tempting as it seems to purchase from an online dealer with such low prices, I will always purchase items such as this at a local dealer. Take from this what you will, heed my warning.

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