Pearls of wisdom

E-commerce jewelry retailer has polished its image to stand out in a sea of online competitors

24th March 2006




Hundreds of years ago, the Australians believed pearls held supernatural powers. Houstonian Amanda Raab isn't sure about that; but she does posses a knack for selling the unshelled gems.

The daughter of two entrepreneurs, Raab sought a way to make extra money as a graduate student at The University of Texas. Researching the online fashion market, she stumbled upon an article about pearls. That planted the seed for her company,

"I knew starting this company that it needed to be something that I can be very passionate about, because I have this personality where I can get very distracted," Raab says. "I made the decision to sell pearls in the middle of night. The idea really pulled my heartstrings."

E-commerce site sells the precious gems for less than one-third of what they cost in a retail store, according to Raab. Because the company buys directly from pearl farms all over the world, Raab is able to maintain low margins, which she says are passed on to customers.

For example, an eight-inch strand of top-grade South Sea pearls that would normally retail at $36,000 sells for $7,000 at A pair of Akoya pearl earrings with an average retail price of $500 costs around $100 through the Web site.

Every purchase comes with a 90-day unconditional return policy, and's record with the Better Business Bureau is flawless. Raab sends the most precious pearls to customers for personal inspection before they are strung.

The entrepreneur says her competitive advantage comes from running a transparent business, as well as her deep knowledge about the company's product.

Indeed, a wealth of information fills the site, explaining everything from the use of pearls in weddings to their place in ancient Hindu writings.

"We do well with our retail competition because we know everything there is to know about pearls," Raab says. "I pride myself in that."

Sharing knowledge with customers has paid off. In 2005,'s revenue grew 186 percent. Since the company's inception two years ago, revenue has risen quickly to top $1 million.

Raab, who started the sole proprietorship with a $10,000 small business loan, credits Internet search engines for such rapid growth.

"I spent lots of time reading technical books, and learning about search engine authorization," she says. "I tried to do as much as possible myself when I started the company to save money."

In addition to maximizing the's position on search engines such as Google and Yahoo, Raab also wrote and submitted articles on pearls, created marketing materials, and networked. Now, she hires outside contractors to do most of those tasks so she can focus on growing the business.

"It takes a lot of work," Raab says. "This is not like a retail store where people have to drive to your store. In this business they can pop back and forth on line, so you have to keep their attention."

Raab admits that she does have a lot of competition, both online and through storefronts.

"The jewelry industry is a tough industry in general, especially in e-commerce," she says. "To be in a sea of 20 million companies and set yourself apart is very tough."

Pearls of knowledge employs Webmaster Cameron Horton to help maintain and develop the company's site. Based in Kansas City, Horton continually upgrades the way customers place and receive orders using StoreFront software. He says Raab's hands-on, inquisitive approach to running her business puts the company ahead technologically.

"Some of the things she's asking me to do are not even on the Web, so they have to be invented," he says. "Not only is that good for her business, it's good for mine. I'd much rather be developing content than maintaining a Web site."

Raab and Horton are working on a project that involves automatically sending a discount coupon to customers' friends when the customer makes a purchase.

"She's good at coming up with these ideas," Horton says. "Other people may be doing them, but not very many in her industry that I'm aware of."

Raab constantly monitors her competition, including other online jewelry companies and retail stores. She is consistently adding to her expertise by reading, traveling and talking to her contacts at the pearl farms.

Soon will feature a new interactive feature, Pearl.O.Pedia, where customers may ask Raab anything they'd like to know about pearls.

A significant portion of's business comes from repeat customers who realize how much money they can save by shopping online.

Raab also brings in new business by meeting potential customers at trunk shows, and setting up individual appointments with those making large purchases.

Among the company's most expensive products is a $100,000 strand of South Sea pearls.

Most of's customers reside in Texas, California and New York, although a growing number are from overseas. offers free international shipping, which Raab says has become especially important as markets in Canada, the United Kingdom and Australia continue to open up.

Raab plans to continue to cater to those markets, as well as expand her products to include more pearls for men as well as younger customers.

The company was founded by focusing on the classical look of pearls, which Raab says will always be an emphasis, even as she expands to include a trendier line.

© 2006 American City Business Journals Inc.