Connect with us

A Client Brings in a Diamond With a Problematic Assessment From a Cruise Ship Where It Was Purchased

How should this independent retailer handle it?

mm

Published

on

IN THE HEART OF a bustling town, nestled between rows of charming boutiques and elegant storefronts, stood a reputable jewelry store named Elite Diamonds. They were known among locals as the go-to jewelry store for every occasion.

ABOUT REAL DEAL

Real Deal is a fictional scenario designed to read like real-life business events. The businesses and people mentioned in this story should not be confused with actual jewelry businesses and people.

ABOUT THE AUTHOR

Megan Crabtree is the founder and CEO of Crabtree Consulting. Before founding Crabtree Consulting, Megan had a successful professional career in the jewelry industry, which culminated with high-level positions at several of the top firms in the retail and manufacturing sectors. Reach her at mcrabtree@crabtreeadvisory.com or visit us at www.crabtreeadvisory.com where you can set up a live chat or a 30-minute free consultation.

 

On an ordinary day, Mark, the proud owner of a local car dealership, entered Elite Diamonds in pursuit of the perfect 4-carat solitaire. He was promptly greeted by sales associates Alex and Sarah, who engaged Mark in a casual conversation to discern his preferences. Mark informed the associates that he was interested in seeing the best 4-carat options available in the store’s inventory. He shared the reason behind his quest for the perfect 4-carat solitaire: This diamond was intended as a token of appreciation and love for his wife on their upcoming anniversary. Mark explained that his wife was married to him before his dealership became successful. Because she had stood by him while he had nothing of value, he wanted to present her with something extraordinary that would commemorate the years of shared joys and challenges.

Alex and Sarah searched their inventory and uncovered not one but two 4-carat diamonds, priced between $50,000 and $65,000. However, when they brought the diamonds out, Mark surprised them by unveiling a 4-carat ring he had already purchased during a cruise, securing what he deemed a remarkable deal at a negotiated purchase price of $18,000. To add to the allure, he presented a cruise ship appraisal valuing the ring at $40,000. Calm but concerned, Alex and Sarah scrutinized the ring and its questionable appraisal.

They immediately realized the appraisal lacked the credibility of a certified assessment. It had been graded by an on-site appraiser with no credentials from esteemed institutions like GIA. Despite the document boldly stating the diamond’s J color and I1 clarity, it lacked brilliance, and the amount of abundant flaws surpassed those expected of an I1 clarity diamond. Now they had to decide how to navigate acknowledging Mark’s pride in his negotiation while addressing the glaring inconsistencies in the presented value.

Advertisement

Realizing the gravity of the situation, Alex and Sarah promptly summoned Elite Diamonds’ owner, Jonathan, who carefully examined the cruise ship diamond. The lack of sparkle and the visibility of inclusions were undeniable. To help guide further conversation with the customer, Jonathan asked his on-site credentialed appraiser and GIA gemologist, Emily, to assess the diamond’s true quality.

Emily’s findings echoed the initial suspicions — the cruise ship diamond fell far short of the quality Elite Diamonds was known for. As she meticulously examined the cruise ship diamond, her expertise unraveled layers of deception. She could identify the poor cut, polish, and symmetry of the diamond, elements that contributed to the lack of its natural brilliance. There were prevalent twinning wisps, cloud inclusions, and black carbon spots scattered throughout the diamond, all visible to the naked eye. Emily considered the diamond closer to an I3 clarity and not the I1 the appraisal claimed. The stark truth, as she uncovered, was that Mark was sold an inferior diamond and its appraisal wasn’t worth the paper it was printed on.

In the silent room, the weight of Emily’s insights settled. As the Elite Diamonds team grappled with the revelations, they contemplated how to navigate the delicate balance between exposing the truth, not making the customer feel bad about being duped, and helping Mark move towards purchasing the quality of diamond he originally intended.

NOTE FROM THE EDITOR: The original version of this story that was sent to respondents contained the phrase “GIA-certified appraiser.” Several of you wrote to correct us that GIA does not certify appraisers. Thank you for your feedback; we have changed the phrase to read “credentialed appraiser and GIA graduate gemologist.”

The Big Questions

  • How would you approach the conversation with the customer?
  • Is it the retailer’s responsibility to enlighten customers about the actual value of their purchases, even if it may lead to disappointment?
  • Given the potential legal ramifications, what measures would you put in place to protect your store and customers in the event of disputes over appraisals and diamond quality?

 

Sherrie L.
Sharon, WI

With two great diamonds of the same size but much better quality on-hand, I would show them the actual side-by-side comparison of sparkle and clarity. The jeweler will need to be gentle but direct. “You were sold a mislabeled product; here is what it should look like at that stated quality.” Similar to how a “Chanel” bag looks next to an actual Chanel bag. It isn’t the customer’s fault that he was lied to, and this will be hard for him to accept.

Vivian Anton L.
Milwaukee, WI

Mark may have walked into the cruise’s shop with a budget in mind, saying, “Show me the biggest and best 4-carat you have.” And the diamond he was shown might have been just that, perhaps being told that he couldn’t get this price at his local jeweler. Coming into Elite Jewelers, asking virtually the same question, this well-established business had a bigger inventory. The casual conversation included his reason for the purchase; perhaps that he wanted the diamond to sparkle, being ignorant of the grading system. Although this doesn’t excuse the cruise ship from misleading the client with an erroneous appraisal, Mark may have wanted to see if what he purchased was a good buy, knowing that most cruise ships offer a full refund in a limited amount of time. Elite Jewelers also had every right to enlighten their client about the true quality of Mark’s stone compared to theirs. Stating facts without casting aspersion on the cruise ship is always the best way to handle this. Lesson: Have a clear return policy in place.

Michael J.
Port Charlotte, FL

As a graduate gemologist, I would simply express my concerns about the apparent quality of his diamond and tell Mark this kind of thing happens all the time to tourists who get caught up in the moment. Because of this, I would suggest he send his diamond to a reputable lab for a report. When it comes back graded considerably worse than was reported at the time of sale and on the appraisal, he may then have the right to a refund from the cruise ship jeweler and buy one from Elite. I’m sure if you were to compare the diamonds at Elite with the diamond bought on the cruise, the difference would be immediately noticeable and give credence to what Mark is being told instead of it looking like they are badmouthing his decision and purchase.

Karen K.
High Ridge, MO

If they had an I1 diamond with J color or close, I would have him examine the diamond and then the one that he bought on the cruise ship to see the differences. After that, if he saw the differences and acknowledged them, I would suggest that he return the diamond to the cruise ship, if possible. If not, set that diamond in a pendant and purchase her a 4-carat in the grade and color that he was happy with for her ring. This way, you are not making him feel bad about being duped and he is saving face.

Jennifer O.
Colorado Springs, CO

The most important point in this situation is to be as transparent and honest as possible with the client. It is not their fault that the diamond they were lured to had quality that was substandard. Keeping the conversation based on the facts is the best way to approach the customer.

It all goes back to this: If something seems too good to be true, it probably is. With the explanation of the appearance of the diamond, we hope that the customer can now see the distinct difference between the lower quality diamond to the one that is now being presented!

Jayson B.
Amarillo, TX

As a GG, I am often called in to a potential sale to “value” customers’ jewelry, either as a way for them to feel good about a purchase decision or in an effort to take a sale away from someone else. I always do my best to approach the conversation without emotion, but with empathy. Since most people have little to no frame of reference in evaluating price/value on a jewelry item, I feel that the onus of responsibility falls on the educated professional to give them a way to make sense of the item’s value, most importantly WHY that value is accurate or not. Disappointment aside, customers are taken advantage of more often than we care to admit, and as professionals in this widely misunderstood field, we have to find ways to share our knowledge without killing sales opportunities. As long as the credentials of the gemologist/appraiser are up to industry standards, they will win any contentious cases by simply telling the truth and backing it up.

Betty T.
South Lyon, MI

I would ask the customer if he is happy with his cruise purchase. If he is happy, continue to show him my stone without commenting about his. I would show him my stone next to his; a visual does wonders to see the difference. I would explain the difference of a diamond with a lab report, which mine has, and diamonds that have not been graded by an outside lab. My diamond has a GIA report, which is most respected. I never discredit other jewelers, but I explain the quality of my own merchandise. You could also suggest he take his diamond to an independent appraiser to get the grade.

Stan G.
Charlotte, NC

The client bought a piece of garbage!! How diplomatic do you have to be to be to present that obvious news? I’d imagine a car dealer would smell a deal “too good to be true,” but apparently he didn’t. Never mind the appraisal discrepancy. No need to pick that apart other than to say it’s not accurate. I’d show one of the better store diamonds right next to his cruise ship purchase and explain that even though there is a 450% difference in cost, it’s a 1000% difference in quality and that lasting value and beauty lies in diamonds of high grade. Ask him if giving his wife the cruise ship diamond is REALLY the reflection of the love and appreciation he’s trying to impress upon her for all the years of standing by his side while his business was growing? Close that sale, it’s low hanging fruit.

Tracy W.
Sierra Madre, CA

We have had this type of thing come up. We explain that different appraisers will not keep the same standards, despite using the same terminology as GIA. Years ago, it was common for many appraisers to slap on a keystone price as value. In this case, we would show the difference between the diamond that this customer bought and the ones we had in the store, explaining all the qualities that account for the difference in pricing. We would point out that he selected a diamond for his wife and his intent to honor her is the most important feature here. We would offer to set it in a most beautiful and unusual mounting, worthy of his loyal wife. If he chooses to use one of our diamonds, we would suggest he pursue returning the diamond due to its inaccurate appraisal. He could go through the cruise line, and we would direct him to JVC if they were unwilling to accept a return based on such an appraisal.

Advertisement
Robert L.
Cape Town, South Africa

In the tiniest nutshell: Refer them to the nearest GIA diamond lab and don’t get any further involved.

Donna Y.
Somerset, NJ

Unfortunately, unscrupulous grading practices, inflated appraisals, and pseudo “bargains” plague our industry. You can blame the little guys, but in truth, big box retailers are just as guilty. With the reputation of an entire profession on the line, it behooves us to educate the consumer in a tactful but firm manner without an ulterior motive of trying to sell them something in lieu of. We’ve had instances like this and have provided a no-charge written statement stating the actual value/grading where clients have pursued successful chargebacks and refunds.

Larry H.
Marietta, OH

Always a touchy topic, but I’m glad the customer wanted to confront his “misfire” cruise 4-carat. We had a similar situation in our store recently. It was a “trade up” potential that had a “misrepresented” appraisal. We enlighten the customers via our standard diamond grading. We then offer to have a GIA grading report done, which confirmed our findings. We reset the diamond, and they said, “We’ll take that back to our (out of state) jeweler and confront him.” Never heard or seen them since, and they have “ghosted” me via email and text. Gotta love it!

Marcus M.
Midland, TX

Don’t tiptoe around this situation or spare his feelings. This customer needs to hear the truth. I mean why did he come in in the first place asking to see a 4-carat diamond if he already had one? He knows he got hosed and just wanted it solidified. Either this uneducated consumer needs a lesson in diamonds/jewelry, or he needs to be told if something sounds too good to be true then it probably is. I would firmly but politely explain to him my opinion of the diamond and situation and tell him that he should send the diamond to GIA for a legitimate grading report. I would let him handle it from there and try to stay out of the middle if I could. I’ve been in this situation before and it’s not easy or fun to tell someone they got taken, but if you do it the right way and can help them navigate a way to a favorable resolution for them, then you’ve earned a customer for life.

Peter T.
Show Low, AZ

I would bring out the two diamonds and hold them next to the cruise-bought one. Then I would directly tell them, “They lied to you. They sold you a low-quality diamond at low price.” If you are looking for a nice quality diamond, you should return the one bought on the cruise. If you like the quality, then by all means, keep it. We would be happy to re-size the ring or reset the diamond into another ring if necessary (for a fee of course).

James S.
Westborough, MA

First, Mark never said what he wanted to do with the ring he showed them. I would first ask him what he wanted to do with the ring; if he wanted to trade it in or if he wanted an appraisal. Second, I would not get involved in any of what he wanted to do. It’s a no-win situation. I would mount the diamond in a pendant for him at no charge if he purchased a diamond from me.

David B.
Calgary, AB

I try to be calm, direct and honest. Might as well pull the Band-Aid off in one pull. Problem with the disclosure is not one of ethics on the part of the store disclosing the true value, but the lack of ethics from the seller. Telling the truth may not be great for the client but is always the best option. As for the way to avoid this kind of issue, it’s not as tricky as it might sound if you stay honest. That may sound self-serving, but about 95% of the diamonds I sell come with GIA or AGS lab reports. If the client disagrees with a report, I can explain the report. However, if they disagree further, then I will do one of two things: send back to the lab for confirmation or give a full refund. Of course, some of the clients need to be vetted out that when they have a dispute, it isn’t because they had a fight with their spouse and now want money back or some similar issue.

Megan C.
Poulsbo, WA

I would start my conversation with the client as soon as I asked to examine it. Reinforcing his emotional reasons for wanting to gift his wife with a significant diamond, I would then ask him if I could show him the differences between his diamond and paperwork versus the diamonds in the store. Remind him that the store prides itself on educating the client. How important are the bragging rights and pride he has with this gift? Tread tactfully into this stage of giving him the opportunity to understand that his choice can factor in more than just the selling price and carat weight.

Leo A.
St. Louis, MO

First, I would show the purchased diamond side by side with any of the stores 4-carat diamonds. Simply ask the customer what he thinks of the two side by side. Let the customer drive the conversation. In most cases, he will see the difference and start asking questions, it will open the door to give the grades of yours and the one he bought. You could suggest to send the customer to GIA, but be cautious not to be accused of the switch.

Sam E.
Chattanooga, TN

The topic of this article is what many of us have faced over the years and with great disappointment for the consumer. However, we will advise them as to just how cautious one should be when (easily) handing over that credit card or signing a payment plan agreement. They simply get caught up in the moment then later upon their return home, buyer’s remorse sets in and WE are tasked with being the bearer of unpleasant news. It’s amazing how easily people fall for these traps.

Advertisement
Lucinda R.
Irving, TX

First, pictures don’t lie. Take a picture with the customer present, through the microscope, send the magnified picture to the customer’s cellphone and present pictures from GIA of an I1 versus an I3 diamond. Ask your GG to discuss what is visible in the stone, while you explain the difference of an appraisal by a person that has no credentials. The cruise ships usually guarantee accuracy, and I recommend that the customer return the diamond for a full refund. Then show the customer your stones, also photographed, and explain the visual differences. Total transparency! Another comparison: The customer sells cars. Would he rather drive a KIA or a Bentley? They both drive, but which one is the better car? The issue must be addressed to avoid the customer accusing the store of switching the diamond. There have been times that I refer the customer to an independent jeweler appraiser with GIA credentials.

J. Dennis P.
Johnstown, PA

Complicated Issue, easy solution: State the fact that cruise ship jewelers are often not knowledgeable. If there is a return policy, which there often is, suggest exercising it immediately. Advise their diamond’s actual quality. Offer same size and quality for $15,000, with appraisal of $18,000. Then, offer what they were “supposed” to have purchased with a legitimate price and appraisal. Then be prepared to show the two gems you had chosen for him and explain the differences. If he cannot return, give him a trade-in on his cruise ship diamond and make a short margin on the sale but create a loyal customer. In my half-century career, having slam-dunked cruise ship “jewelers” many times, there was never the threat of any litigation; the unscrupulous know they’re unscrupulous!

What’s the Brain Squad?

If you’re the owner or top manager of a U.S. jewelry store, you’re invited to join the INSTORE Brain Squad. By taking one five-minute quiz a month, you can get a free t-shirt, be featured prominently in this magazine, and make your voice heard on key issues affecting the jewelry industry. Good deal, right? Sign up here.

Most Popular