Buying a $10 paperback from Amazon or a 99-cent new release from iTunes is now commonplace. But has online shopping matured to the point where people don't blink at dropping a $20,000 half-carat diamond into an online shopping basket and proceeding to checkout?  De Beers Diamond Jewellers, Inc. is banking that the answer is yes. And given the success of online-only jeweler Blue Nile, they might be right.  Online jewelry sales have exploded in recent years, reaching $2.5 billion in 2006, up from $2.1 billion in 2005 and $1.7 billion in 2004, according to IDEX Online, a business-to-business diamond trading exchange that analyzes data from the U.S. Department of Commerce.  Now De Beers is entering the fray. The privately held retailer, created in 2001 as a joint venture between De Beers SA and LVMH Mo&euml;t Hennessy Louis Vuitton, premiered its Web site in June. Featuring 190 different pieces (of which 90 are for sale online), the site's prices start at $500 and cap out at a $24,500, 1.5 carat engagement ring. In September, the online offerings will expand to 140 pieces with price points up to $50,000. But for De Beers's six-figure jewelry, buyers are directed to the company's smattering of luxury boutiques across the globe.  Companies such as Blue Nile Inc. NILE -1.40 % -- which has a market share of more than 30%, according to Internet Retailer, a trade publication that tracks online sales -- have successfully tapped into the Web-savvy diamond buyer. But until De Beers unlocked their virtual doors, most upscale jewelry companies resisted the online shopping cart. Luxe brands like Harry Winston, Van Cleef & Arpels and Cartier have Internet sites detailing their collections, but don't give visitors the option to buy online. Instead, they stress in-store customer support and a tactile experience of jewels.  Blue Nile, launched in 1999, is largely fueled by engagement-ring sales. Because the company relies on consignment goods, it requires few employees and less real estate than its brick-and-mortar counterparts, which allows Blue Nile to offer its stones at up to 40% off, according a report by Jewelry Research Institute president Ken Gassman. Blue Nile's steep discount attracts customers who might otherwise spend $10,000 somewhere else. Last year, the cost of the average ring purchased at Blue Nile was $5,600, versus a national average of $3,200 for rings purchased in-store.  What drives this success? Engagement rings carry what Mr. Gassman calls a "diamond bias": Customers are not only likely to spend more on diamonds than other gemstones, but they are also more likely to pay more for engagement rings versus other diamond jewelry.  The Internet is where people turn to for pre-information on jewelry, especially bridal purchases, said De Beers Diamond Jewellers CEO Guy Leymarie of the company's decision to go online, adding that for a certain demographic, the desire to discreetly buy luxury items is alluring.  "We tried to make [the De Beers Web site] extremely attractive and extremely linked to the store experience," Mr. Leymarie said. "We want to channel the Web as a truly virtual store."  Unlike Blue Nile, De Beers doesn't sell all of the jewels featured on its site, instead choosing for-sale items based on price points and the details of the gemstones.  "The philosophy is that for some stones, the level of [the jewelry's] brilliance should be experienced in the store," Mr. Leymarie said. "We didn't want, maybe wrongly, to put too high a price on the Web at this stage." Still, Mr. Leymarie concedes, "This doesn't mean that we will not consider this in the future."  In deciding to reserve its priciest inventory for in-store customers, De Beers followed precedents set by other upscale retailers.  Tiffany TIF 2.37 % & Co.'s site offers an online catalog, but despite a detailed engagement ring section, engagement rings can't be purchased online. Even so, Tiffany is the third highest-selling Internet jeweler, with $120 million in online sales in 2006, according to Internet Retailer. (Second place went to Bidz.com, which rang up $132 million in Web revenue.) Tiffany declined to comment.  Even with high-end retailers holding back, $600,000 diamonds can be purchased at Amazon.com. AMZN 0.08 %  Amazon's jewelry store launched in 2004, and recently bulked up its offerings to include high-end items like six-figure loose diamonds, an Amazon spokesperson said. The retailer reported that jewelry sales more than doubled during fourth quarter 2006, and confirmed the recent sale of a $90,000 canary yellow diamond earring set. Jewelry is held by wholesalers instead of being warehoused alongside Amazon's books -- and most jewelry pieces qualify for free shipping.  Online retailers like Amazon, Blue Nile and De Beers post detailed data on their gems -- stone certifications and precise measurements on the so-called 4C's (cut, clarity, color and carat) -- to appeal to customers who prize analyzing information for themselves (Blue Nile says their typical customer is a C-level executive working in technology, banking or law).  The one wrinkle in that premise is that many people want to see the sparkle in a diamond -- something that is hard to judge online. It also may be hard for a consumer to distinguish one cut over another among two otherwise identical stones. Cut is the "C" that has the most impact on light performance, or sparkle, and the overall look of the diamond. A diamond with perfect clarity and perfect color but a poor cut will appear dull.  Even with high-resolution photos, virtual diamonds don't yet translate the visceral reaction of seeing light bounce off a faceted stone in person, which is why luxury jewelers like Harry Winston stress the opportunities of the in-store visit.  "We look to give our clients a unique, one-on-one experience in our salons when they want to make a Harry Winston purchase, which cannot be replicated online," Harry Winston spokesman Carson Glover said. Tiffany's Web site warns potential customers that "it takes a lot more than the oversimplified 4c's to know why Tiffany diamonds are so beautiful."  Rishi Chandra, a 28-year-old product manager at Google, said he had "no information whatsoever" about diamonds when he made the decision to propose to his then-girlfriend, Monica Deshpande. But because he was about to buy something that is "a little rock and [yet] costs that much money," he spent several weeks digging into the minutiae of diamond ratings. Despite all his research, Mr. Chandra felt that cut was the one aspect he didn't have a handle on by only relying on online details. He visited local jewelers in San Francisco and Palo Alto, including Tiffany, to gauge how cut affected stones.  "I was actually more confident with some of the information I was getting on the Web than even looking at" stones in person, Mr. Chandra said. "One of the challenges is that when you look at a diamond in a store, the lighting is all set up so that it's very bright for you. They are trying to emphasize the brightness of the diamond." He eventually purchased a ring at Blue Nile; he and Ms. Deshpande were married in July 2006.  Mr. Chandra was pleased with the experience of buying a diamond online and said he would have returned to the Internet for wedding bands, but his then-fianc&eacute;e insisted on a more traditional route. "When we were buying the wedding bands, she was actually very adamant that we had go see it," he said. "She wanted to try it on."  Write to Elva Ramirez at elva.ramirez@wsj.com
Shoes and songs aren't the only things easily purchased on the Web these days. With the recent launch of De Beers's virtual store, the diamond industry is pushing the wheels of its online shopping carts.