Cutting Classes

Hearts On Fire knows how to cut a diamond – and how to keep independent jewelers excited about selling them. By inviting its retail partners to Las Vegas for three days of training, inspiration and fun, Hearts On Fire has achieved a compound annual growth rate of 30 percent over the last 11 years.

With Internet jewelry sales increasing and strong competition from chain jewelry stores, company founder and CEO Glenn Rothman created Hearts On Fire University to differentiate his diamonds – and, by extension, the manner in which they are sold.

Rothman was at the forefront of the movement to “brand” diamonds: the company’s slogan is “The World’s Most Perfectly Cut Diamond.” And with Wal-Mart currently the No. 1 destination for U.S. jewelry shoppers, such differentiation is vital for Rothman and the independent jewelers that sell his company’s diamonds.

Only 1 percent of rough diamonds are pure enough to become HOF diamonds, according to company literature. Those stones are then cut at 100x magnification, “creating perfection at 10 times the industry standard.” Over the last five years, HOF has developed a complete collection of fine diamond jewelry sold at 600 U.S. retail locations, as well as in 30 other countries.

“I believe in learning,” says Rothman, who founded the company with wife Susan in 1996. “‘The more you learn, the more you earn’ is one of my favorite statements” and “no events by other manufacturers, branders or wholesalers in the diamond or jewelry industry are even similar” to Hearts On Fire University.

The first HOFU was held in 1997, attracted 50 people and held evening activities at a Chinese restaurant. Ten years later, more than 1,200 people attended the three-day event at the Bellagio in Las Vegas. Classes ran from 8:30 a.m. until 6 p.m., and then “each night we took over the best clubs in Vegas,” Rothman says. “We work hard and then we party hard.”

The primary goal of the program is to encourage jewelers to “fall in love again with their careers and the business. This environment of learning, excitement and fun is something they don’t experience in day-to-day business activities,” Rothman says. “It’s like plugging in to recharge your batteries.”

HOFU includes specialized tracks for owners, managers and sales associates. Training for owners usually focuses on the running of the business and managing staff. Managers learn about sales productivity, motivating associates and setting goals, while associates get the opportunity to view the entire HOF jewelry collection – for the first time, in many cases.

Broad curriculum
Actors are brought in to role-play sales counter scenarios. Participants provide feedback, and then the acting troupe goes back through the scenario “the right way.”

While some classes are taught by the company’s internal team, others are led by business professors or experts in particular sales techniques. Last year, a particular point of emphasis was reading customers’ body language, and a vice president of Ritz-Carlton gave a presentation on customer service.

Participants watch a diamond cutter craft the HOF diamond (the cut – eight hearts seen through a jeweler’s loupe from the bottom and eight arrows or “fire bursts” seen from the top – was the inspiration for the company’s name). With students from around the globe, HOFU employs Japanese, Mandarin and Spanish interpreters.

Harvard professor Ben Shapiro “has attended hundreds of sales events and told us that he has never experienced anything remotely like the Hearts On Fire University,” Rothman says.

HOF has its own training department, headed by vice president of education Rhonda Edelman. “One of our company’s core competencies is that we have the largest education team in the industry,” she says. “We bring together a lot of independent jewelry stores and make them a part of something bigger. We promote the culture of education, we embrace it, and we see results. The biggest benefit for many retailers is that they learn from each other.”

In-house planning
HOFU classes and workshops are not planned or conducted by an outside event company. “We take our internal salespeople, designers, product development and finance people – everyone from our internal organization goes to Vegas, and we run this event ourselves,” Edelman says. “We are there to serve, love, support and host our customers and partners.”

Generally held in late September, HOFU is timed to prepare jewelers for the holiday season – though it isn’t always necessary to wait until the end of the year to see results. October 2007 sales, for instance, increased 49 percent from the same month a year earlier.

“This is the 11th year of the university, so going up against the second-largest sales month of the year makes this truly a large number,” Rothman says. “This is a direct measurement of the effectiveness of training.”

HOF spent $2.9 million on the 2007 event. Participants pay a “small tuition,” Rothman says, “because if it’s not free, it’s more valuable.”

Some jewelry stores shut their doors so their entire teams can attend the program; others rotate participants or run contests to choose who will attend. Intensive training also occurs throughout the year, either at retailers’ locations or at HOF offices. Another idea to keep retailer and associate interest high: the company helps retailers increase business and motivate sales associates by providing the opportunity to earn reward points toward HOF jewelry.

“The most important thing in an organization is its people,” Rothman says, and developing that talent must be a year-round priority. “The more you invest in education, developing and motivating your team, the better the results,” he says. “You will have happier, more effective people because everyone feels good when they are learning and when they are challenged with change.” HOFU participants leave with the “ambition and aspiration to go back and succeed,” he says.

Hearts On Fire is considering the development of a school that might operate “for a two- to three-week period with the goal of specifically developing talent in our industry,” Rothman says. “One of the biggest challenges for independent retailers in our industry is people: No one is providing them with trained associates. There is no good, reliable source of talent.”