Dicker used to sell jewelry the old-fashioned way telling customers that over time, it would appreciate in value. They would soon return, however, with their heirlooms in tow, looking to cash in on his friendly advice. In those days, Dicker would reply, I dont want your jewelry.
That prompted the inevitable outcry from his customers: But you said it would be worth more in the future.
To which Dicker would answer, Our jewelrys worth more in the future. Nobody wants your jewelry.
But, as Dicker soon learned, he was wrong.
Im telling them its going to be worth more and then I dont want to buy it, he explains. That doesnt make sense. In the 1960s, we bought our first estate piece and sold it almost that same day.
It was then, 30 years ago, that Dicker realized he was on to something big. Over the next few decades, the jewelry store established a niche in the estate market, reaching clientele nationwide.
As with any good idea, imitators soon followed, and the jewelers hold on the estate market started to wane. Whenever Dicker offered a price for a piece of jewelry, no longer was it a straight take it or leave it decision. Customers had a choice.
Too many people were walking away, he recalls.
As a solution, and to maintain high traffic in the store, Dicker countered with an odd proposition.
I said, Im going to offer you $1,000, but you say you want $2,000. What if I had an auction? Ill put it on the market for $2,000. If it sells for $2,000 or over, great were partners, we love each other. If it doesnt sell, I can still give you the $1,000.
Customers agreed, and thus began the jewelry auctions.
In Dickers auctions, no fees paid by the seller. Thats different from the fee structure in traditional auctions. Auction houses generally tack on fees, including entry, photography, catalog and insurance, to name a few.
And there is no buyer premium. The store makes money by charging a 10 to 35 percent commission on the jewelry, 60 percent of which comes from private collections. The commission is based on how easy the item is to sell.
Dickers first auction, in 1994, was a live event. People came to the store to bid. But three years ago, two high school students approached Dicker and his co-owner sister Leah, and put their store on the Internet. Back then, people could preview auction items but couldnt bid on them. As events evolved, people could watch and listen in real time, but again, they were unable to bid.
That all changed a few months ago. In August, at Dicker & Dickers most recent auction, they combined a live event with Internet bidding. The site received upwards of 1,000 individual hits each day leading up to the auction, Dicker says.
People previewed and placed bids on items for weeks before the live event. A week before the sale, nearly two-thirds of the pieces had bids on them. Then, beginning at 10 a.m., and every two minutes after that, bidding closed on each of the items.
The first item, a ladies 18K-gold wedding band, with an estimated value of $380, sold for $172. Many items were offered without reserve, meaning the opening bid was $1.
But the auction does far more than just sell estate pieces.
The auction brings thousands of people to our Net site, Dicker says. And as they come in, just the same way theyre coming into the store, theyve got to walk through and see the regular jewelry. On our Net site, the first thing they see is the new jewelry. Then theyve got to click over if they want to go to the auction. So it sells a lot of the primary jewelry that we have.
We never had (much of) a national profile until the auction came along, he says. Youve heard the book The Mouse That Roared? This is the jewelry store that roared: a jewelry store in the 25th largest city in this country that is doing business with places in London, South America, Germany, Yugoslavia. The phones are going nuts. Weve got people calling regularly from California, from Florida, from coast to coast. Its wonderful.
There is another reason to go online, Dicker says: Necessity.
With the Internet, you cant sit back, buy goods in New York and bring them to your store in Cleveland and put up a sign and sell them. The ones that its still working for, their days are numbered.
While the popularity of his online auction is growing, Dicker knows he needs to give his customers something else. So several jewelry experts were brought in to discuss a variety of topics, as well as answer basic questions about jewelry.
For us, its a new avenue to make added value, where were going to be able to sell advertising, both on our Web catalog and in our Web radio show, Dicker says.
Auctions are scheduled one a month for the rest of the year, and at least one a month next year. The goal is to turn the auction into a regular program. By the time the Internet turns broadband and people are able to watch television on their computers, Dicker would like to turn this into an auction that runs 24 hours a day, seven days a week.
But for now, hes satisfied setting the pace for the jewelry industry.
How to reach: Dicker & Dicker Jewelers (216) 464-0400, or www.dickeranddicker.com
Daniel G. Jacobs (email@example.com) is senior editor at SBN.
By the numbers
389 total number of pieces sold
$25,000 highest price paid for an item (an 8-carat platinum heart shaped diamond solitaire ring; estimated value: $70,645)
$114,785 estimated value of most expensive item in the auction, a 14kt YG, 13.80-carat diamond ring
$129,000 highest price ever paid for piece at a D&D auction
$350,000 estimated total value of the pieces sold at the most recent auction