Bargain engagement rings, is there a catch?
We’ve recently created the new Amazon Hidden Discount Tool which finds large reductions on Amazon. It enables you to create your own bespoke pages of hot discounts. We generated a few example links yesterday, and I ended up looking at the engagement rings 90%+ off* search.
I was blown away by the discounts – a number of rings were originally priced at £14,000 but reduced to under £1,500. The shock comes not just because of the size, but these are products where a substantial proportion of the cost comes from the raw material.
Assuming probity, there are two most likely explanations for this (note these are usually not Amazon products direct, but Amazon Marketplace products – i.e. third party sellers).
- The initial price is deliberately over-inflated. Has this been done just to make it look like there’s an enormous reduction or even to target the type of search the tool does? Is it a ridiculous intitial retail mark-up.
- They’re under priced for speed sale – meaning the diamonds & platinum/gold could be sold at a profit. If the reductions are real, it should be possible to buy the rings, and sell the constituent parts for profits – though please don’t think for a second I’m advocating that.
Checking out the listed value – a £6,000 profit is too good to be true
To test this theory very roughly (and I am no diamond expert so my notes are as rough as an uncut gem) I took one ring as an example.
It is listed as a 1 ½ carat, H color, SI1 clarity, certified, round cut, diamond ring on a platinum base, priced at £1,460 reduced from £14,000.
I then put that diamond into this diamond search tool (not one I know, just one that popped up on Google) – which told me I could buy it for £8,100.
So therefore it’s easy to jump to the thought there’s a £6,000 profit to be had. Yet of course let’s be realistic, that’s a retail price to purchase: so halve it due to mark up, then take more off for VAT and tax and say you could only sell it for £3,000. That’s still a profit of £1,500.
So what’s really going on here? No business can run that way, so something surely is up. Can any jewellers shed some light on this?
And please DON’T think I am in any way suggesting anyone buy these to make a profit – the intention of this blog is only to mull ideas about what’s going on here.
