CIRCA_Jewelry_reuse_recycling

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James S. Mulligan

[email protected]

Institute forEnvironmental Diplomacy and Security

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Published November, 2011

Institute for Environmental Diplomacy & Security @the University of Vermont

This case provides a detailed description of a company that buys pre-owned fine jewelry from the public and places it back into market circulation. The case de-scribes the founding and evolution of CIRCA’s business model and discusses the company’s working culture, organizational structure, and methods of distinguish-ing itself from the competition. A brief description of the avoided environmental damage associated with the jewelry resale business is included, as well as a discussion of consumer’s motivations to sell their jewelry to CIRCA. In light of a growing trend in the luxury goods industry towards “sustainability” and “green” businesses, CIRCA is looking to capitalize on the environmentally-friendly nature of its current business model to attract more clients though a sustainability-based marketing campaign. The case introduces the rationale behind this decision and outlines the company’s progress thus far. A teaching note with suggested exer-cises and discussion questions is included at the end to help students consider what additional actions are needed in order for CIRCA to realize the full potential of its new marketing campaign.

Disclaimer: This case has been prepared as the basis for discussion and collec-tive learning rather than to illustrate either effective or ineffective handling of an administrative situation.

The Author

Alex Hasbach is currently a Master’s student in Stanford University’s Earth Systems program. She is especially interested in the social and political aspects of environmental management and stewardship, and found it fascinating to explore these issues from an industry perspective at CIRCA. Alex’s current work focuses primarily on issues of agricultural development, climate change and food security, and she hopes to pursue a long-term career in these areas.

Alex Hasbach

Case Study: CIRCA - The World’s Largest Jewelry Buying Corporation

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Institute for Environmental

Diplomacy & Security

www.uvm.edu/ieds

The Institute for Environmental Diplomacy and Security

The Institute for Environmental Diplomacy and Security (IEDS) is a transdisci-plinary research center dedicated to both the study and practice of techniques that resolve environmental conflicts, and to using ecological processes as tools of peace-building. We welcome new partnerships and encourage scholars interest-ed in collaborating with us on any of our thematic areas (Borderlands, Pragmatic Peace, Resource Values) to contact us. Learn more at www.uvm.edu/ieds.

The James Jeffords Center at the University of Vermont

As an American land grant university, the University of Vermont has the obliga-tion to play a significant role in fundamental research, as well as evaluation and analysis of policies and programs that affect the public at large in a variety of disciplines critical to global policy-makers. In recognition of this, the University established the James M. Jeffords Center in 2009, so named to honor former United States Senator James M. Jeffords for his long and distinguished service to Vermont and the nation. The center is, however, a nonpartisan organization and works in the spirit of independence that Senator Jeffords championed during his career. The Institute for Environmental Diplomacy and Security is a signature project of the James M. Jeffords Center.

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Introduction

The elevator opens onto the nineteenth floor of 415 Madison Avenue and a new customer is released into the CIRCA waiting room. The first image she sees is a close-up painting of a younger woman’s lips, wrists, and perfectly polished nails. The paintings here are designed to project glamour; they highlight the models’ smooth, taut skin and the gloss on their long, red nails. Padded bench seating lines opposing walls in the waiting room, and each wall is in reach of its own coffee table containing a thick binder. The binders are full of glossy photos featuring rare antique jewelry and photos of CIRCA’s CEO playing polo in the Hamptons.

The new customer looks small as she enters the waiting room and walks to the re-ception desk. She is at least seventy-five years old, with short white hair and a floral dress. Her nylons match her hair, and she stoops a bit as she takes slow but proud steps towards the receptionist. The client checks in and begins a slow shuffle to the padded seats. Before she even sits down, the receptionist has already picked up the phone and announced to the general office intercom that a NEW CLIENT has arrived and is waiting to be helped. The receptionist, who likens her job to “air traffic control,” uses an urgent tone that would not be out of place in air traffic control room itself; it seems that any deviation from her usual protocol might cause an unwanted customer service accident.

The new client is finally seated and looking nervously around the room. She opens her white leather shoulder bag and applies fresh lipstick, perhaps at the sugges-tion of the paintings on the wall. Small groups of CIRCA employees enter the room though different doors, and stand talking business while they wait for elevators to ferry them upstairs to meetings or down to the street. They discuss sales of specific pieces and swap tips about who might like to buy. The men look sharp in jackets and ties and all of the women wear high heels. The new client glances down into her purse at the familiar boxes containing the jewelry she intends to sell, then gathers herself and shuffles back to the receptionist to ask when she will be seen. The tanned and smiling air traffic controller makes another call reminding the office about the NEW CLIENT, and almost immediately, a buyer emerges. The client is then ushered through a set of heavy wood and glass doors, down a hallway and into private room where she’ll receive a private appraisal of her pieces.

Scenes like this lie at the heart of CIRCA’s work, as the majority of the compa-ny’s business hinges upon making the customer feel comfortable enough to part with treasured and valuable pieces of jewelry. CIRCA buyers must ensure that clients don’t “hesitate,” but agree to accept a check on the spot in exchange for the jewelry they bring to the appraisal. This process is repeated many times through-out the day; a typical mix at the Manhattan office might consist of a half-dozen “walk-ins” and double that number of scheduled appointments, though the pattern is not always fixed. One summer day saw fourteen walk-ins and only eight appoint-ments. Consistent across every workday is the gravity with which each individual meeting is treated.

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CIRCA provides a service for clients looking to sell high-end jewelry they no longer want. Its clientele varies in age and style, but all are seeking a luxury experience and want their jewelry and their memories treated with recognition and respect. The “success” of the buyer/client interaction is extremely important to CIRCA’s business model, and the company focuses first and foremost on maintaining a high level of customer service and creating positive client experiences. Buyers are highly trained, and everything in the office is geared toward the smooth man-agement of client egos and expectations regarding the price and value of their jewelry. With any luck, each new client will have such a positive experience that they choose to return to CIRCA and to refer their friends. In this way, CIRCA hopes to continue its rapid rise to the top of the market as the largest buyer of fine jewelry from the public.

History And Business Model

CIRCA was established in 2001 by three partners who got their start in New York City’s notorious 47th Street jewelry world. All three founders had experience in the district’s tightly knit diamond cutting and jewelry retail businesses, and they came together in 2001 with the intention of creating a new business that would buy high-end jewelry from the public. At that time, a strong stigma was associated with jewelry resale, in large part because of the unglamorous and often unfair ex-perience that sellers had in the resale outlets of the day; dingy pawn shops with bars in the windows, cash-for-gold outfits that promised to melt down treasured pieces, and other settings that made would-be sellers shy away over concern for privacy or personal pride. The assumption, CIRCA co-founder and current CEO Chris Del Gatto remembers, was that you would only sell jewelry at any of the existing outlets if you desperately needed the cash. Accordingly, it was assumed that the sales process would be an embarrassing experience a high-end clientele ought to avoid.

Chris and his cofounders set out to change the jewelry resale business by creating a place that would feel more inviting, more luxurious, and more appealing to an upscale clientele. Their basic business plan was to encourage clients to see their own jewelry as a liquid asset; something they could put back “on the market” in a discreet way in exchange for fair and immediate compensation. CIRCA’s founders imagined the high value of jewelry sitting in safe deposit boxes, safes and even drawers all over the city, and saw a virtual treasure-trove of untapped business potential. At CIRCA, the founders hoped to create an environment where clients could off-load jewelry they no longer wore, but that might still have high aesthetic or historical value to collectors and other jewelry buyers around the world. Rather than evaluating pieces based solely on the weight of their gold or the carats of their diamonds, these partners envisioned establishing a base of collectors and buyers who would value each piece of jewelry as a piece of art, and to resell those pieces so that future owners could enjoy their pre-owned jewelry in ways “consistent with their original design” (Guthrie, 2011).

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CIRCA was a self-made organization from the very beginning. The partners were rich in “street instincts” from the “school of hard knocks” that was 47th street at the time. They had little experience in running a business like CIRCA, however, and they learned how to manage their new company though a process of trial and error. Throughout the early stages of their business venture, the three partners benefited greatly from mentoring and advice from others in the industry, especially from their initial venture capitalist. They were advised early-on to create specialized roles and prioritize corporate governance, for example, and believe that advice has served the company well throughout its expansion and image development.

Just a decade after its founding, CIRCA has enjoyed a rapid expansion across the globe. The New York headquarters now links to locations in Chicago, Palm Beach, San Francisco, Washington DC (actual location Bethesda, MD), and Hong Kong. The newest office is now operational in Barcelona, and CIRCA also has near-term plans for continued geographic expansion in Geneva, Dallas, Los Angeles and other locations. At this time, all of CIRCA’s jewelry inventory is still maintained in New York, including jewelry traded by the overseas offices.

The company’s rapid expansion has been fueled by multiple factors. From 2001 through 2008, CIRCA focused on buying jewelry directly from the public. During the 2008 economic recession, CIRCA launched its overstock, or “Solutions” business, which buys excess inventory from brands and places it discreetly back on the market in a way that does not negatively affect the brand. This helped cement existing relationships with brands and opened up new distribution avenues like online flash sales. In 2008, CIRCA also founded its retail purchasing agent program in which it works with retailers across the US to purchase items from their clients. CIRCA had always worked with retailers to discreetly buy excess jewelry inventory, but under the purchasing agent program, select retailers carry CIRCA branding in their stores and CIRCA buys unwanted jewelry directly from their clients.

For the core business, an expansion into Europe and the re-opening of the office in Hong Kong has helped increase the client base, and the influx of new jewelry helped CIRCA expand its network of global buyers and contacts, which in turn has allowed the company to access more collectors and other specialized markets offering high prices for fine estate jewelry. This buyer network is of critical impor-tance to CIRCA, as it allows the company’s buyers to offer high prices to clients while maintaining confidence that they will be able to turn a profit for CIRCA when they resell the piece. One of the biggest challenges for CIRCA and others in the recycled fine-jewelry trade is to maintain and grow these business connections, even as the more collaborative 47th Street culture of the past gives way to a business environment in which each firm is in business independently. To date, CIRCA has chosen to keep their jewelry business largely “in the family” of jewelry traders and collectors, and does not allow the public to browse their jewelry inven-tory or buy directly from the CIRCA website or offices. This decision distinguishes CIRCA from its competition, in that it requires more personal contact and negotia-tion between clients, CIRCA buyers and the jewelry’s new owners.

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CIRCA made somewhat of an exception to its usual policy in June of 2009 when it collaborated with Bluefly.com to host a two-day private sale of estate jewelry from CIRCA’s collection. The sale featured signed pieces from top luxury lines, and provided an exclusive opportunity for Bluefly.com’s “fashion-obsessed clientele” to “experience the ease and comfort of selling their jewelry for the highest value” that CIRCA could offer thanks to its global buyer network. Though the Bluefly sale was brief, CIRCA will continue to consider similar collaborations with other high-end retailers, though Del Gatto said that ultimately, CIRCA is more interested in trading on a larger scale-- with global buyers and collectors. The Bluefly case provides a good illustration of CIRCA’s willingness to experiment and test new possibilities for expansion, but also shows that the company has not yet settled on a single business strategy.

The most significant constraint on company growth, according to co-founder Jeffrey Singer, is finding and training sufficient numbers of talented employees and human resources personnel. The hiring process at CIRCA involves a rigorous training process that often deters or eliminates potential CIRCA employees. Prospective buyers at CIRCA must endure a 6-8 month training process before they can conduct business with CIRCA clients. Approximately half of the entering group of trainees will not make it though the training, which is designed to select only those trainees with both a high emotional and intellectual intelligence. Head of Buyer Training Angelina Chen says that all buyers will have some history in the jewelry industry before coming to CIRCA, though they need not have a specific experience; the candidates that will be successful in CIRCA’s buyer training are those who are hard-working and have a mind for customer service.

CIRCA’s intensive training process helps lay the foundation for a strong and united company culture. Chen has been at CIRCA for seven years, and says that CIRCA has developed a global “feel” about it, since most employees have spent significant time traveling abroad for their work in the jewelry trade. Co-founder Jeffery Singer said the main attraction for employees at CIRCA should be the ability they have to shape their own industry and to be part of something that is growing so fast. Though Circa employees are well compensated, the main draw at CIRCA, accord-ing to Singer is that there is “no other place like it” where buyers can be guaranteed to evaluate such a diversity of pieces, never knowing what they’ll see from day to day. CIRCA’s combination of unusual working environment and employee incen-tives appears to be a winning one; everyone agrees that days in the New York office go by fast, and employees routinely stay in the office until 8:00 or 9:00pm. They laugh as they recall days when their colleagues set off after-hours alarms when they finally stood up from their desks to head home for the day.

The organizational chart in Appendix A shows CIRCA’s corporate structure as of August 2011. External to the daily operational structure, decision rights at CIRCA rest first and foremost with the eight-member Board of Directors, three of whom are part of CIRCA’s core management team. Six of the eight Directors have a

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professional history in the jewelry and watch business, so this group of advisors is well positioned to understand CIRCA’s business environment and to make an important contribution to the company’s long range planning, strategy, and annual budget. The board meets quarterly to review financial results from the prior quarter and to discuss new and relevant issues. Though they do not communicate directly with the company, information and decisions are communicated down to CIRCA employees by way of the managing members who sit on the board.

Chairman and CEO Chris Del Gatto is himself a member of the board, and sits atop the organizational structure at CIRCA. Del Gatto says that in fact, he sees the business as an inverted pyramid with him at the bottom supporting the rest of the company. “I try to mentor everyone” he says, and to stay true to his personal management “philosophy” that he works to “breathe through the arteries of the company everyday.” Everyone at CIRCA seems to revere Del Gatto’s “insatiable appetite for knowledge” (Singer), and “magnetic character” that “relays a zeal and passion for an industry that he and his co-founders have revolutionized” (CIRCA Press Packet). Del Gatto states that he tries to stay abreast of new trends and opportunities in the industry, likening himself to a doctor who graduated from medical school ten years ago who wants to keep learning new processes and pro-cedures. He is interested not only in trends within the jewelry industry, but in the entire “luxury world.” CIRCA holds monthly meetings and regular company-wide seminars, and Del Gatto is always working to keep employees informed about new developments. Del Gatto is thought of as a pioneer for luxury market growth, and he provides an important public face for a company where marketing and outreach efforts are crucial to successful branding as providers of a luxury service.

Customer Service

“At CIRCA, we understand that selling treasured items can be an emotional process and we take this responsibility seriously. CIRCA’s policy is founded on being consumer advocates first and foremost. By being transparent throughout the process, a process which in the past has been viewed with some apprehension, CIRCA allows for professionalism and honesty to prevail in each transaction.” –CIRCA press packet

This excerpt from CIRCA’s promotional materials describes the company’s com-mitment to customer service throughout the jewelry buying process. CIRCA’s cor-porate strategy hinges upon making jewelry resale appealing to customers accus-tomed to a “luxurious” way of life, and everything from the wording of its ads to the structure of client meetings seeks to project an air of dignity and respect. CIRCA buyers talk about jewelry as just one part of a client’s financial portfolio, right along-side the cash and real estate they might liquidate in order to fund a vacation, a home renovation, or other family need. The stigma associated with recycling jewelry back into the market has not disappeared completely, but Del Gatto says he believes that CIRCA is making progress. Especially in an era where “people don’t feel bad about selling an Hermes bag on EBay,” he says, Del Gatto sees no reason why a client should feel bad about selling a diamond ring they haven’t worn in fifteen years. CIRCA works to make the sale process as discreet and as easy as

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possible, which also helps distinguish it from the auction setting where clients may also consider selling high-end jewelry pieces. Auctions are very public and very expensive, however, and clients must sell on consignment instead of receiving a direct payment. By contrast, CIRCA is able to close a deal with a client on the spot, and allow that client to leave the office with a generous check in hand.

CIRCA knows that it needs to maintain an impeccable reputation for customer service and transparency in order to grow its business, and CIRCA buyers will do whatever it takes to make each client’s experience a positive one. It is company policy to make an offer for every piece a client presents, even if that means writing a check for $20 or less. Buyers are instructed to approach a modest engagement ring with the same attention to detail as they would an entire collection of rare Art Deco pieces. No matter the absolute market value of the piece, CIRCA’s buyers are trained to manage the client’s emotions and expectations regarding the offered price for that item. To that end, the company motto is “Worth More”—a reference to the added value that CIRCA buyers are able to offer clients thanks to their intimate knowledge of the jewelry’s value on the global market. “We don’t have a product, we have a service” Singer says adamantly, and CIRCA has developed many tech-niques to help buyers maximize the efficacy of that service. That strategy seems to be working, as over 60 percent of CIRCA’s clients are repeats or referrals. The specific sales strategy a buyer uses depends on client, but it is not unusual for buyers swap out in the same session for a second opinion on a piece and to help convince a client to sell (a maneuver called a “turnover”). For satellite offices, where there is typically just one buyer, CIRCA typically uses video chat to provide clients with a second opinion from a buyer in New York, who is trained to handle the “high-tech” turnover if a client hesitates about selling a piece in a satellite office.

Competition

Part of the reason for CIRCA’s strong emphasis on customer service is the abun-dance of competition in the jewelry resale industry. Though CIRCA captures a sig-nificant portion of the used fine jewelry market, clients still have other options from which to choose. Kentshire, for example, is an antique jewelry and furniture dealer based in New York that buys and sells fine pieces of period estate jewelry. The two companies differ in that Kentshire customers can come in to a store to browse and buy jewelry both on location in Manhattan or through the company website online, while the public cannot buy from CIRCA directly. Other potential competitors exist in the NY area. Windsor Jewels has offices in NY, London, and France and offers a similar service as CIRCA where clients can come into a company office in person and receive a check for their jewelry on the spot. The Windsor business model is a very similar model to CIRCA’s (with an emphasis on privacy, transparency, and personal interaction with a buyer), though Windsor has also chosen to allows customers to buy jewelry directly from their online site. Beladora.com operates a similar business where clients can sell in person in Beverly Hills and buy or sell online. Some businesses are interested only in jewelry from a certain time period,

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while others like “Divorce Your Jewels” and “Out of Your Life” focus on quick and discreet service for people trying to rid themselves of jewelry associated with dif-ficult memories or old relationships. A plethora of “Cash for Gold” business also exist, though these outlets do not typically sell to collectors, but melt down and recycle the gold metal itself. A UK-based company even offers to organize jewelry-collection fundraisers for schools and charities, though it takes a 25% of the profits from its sale of the used jewelry pieces to smelters or, on rare occasions, collectors themselves. Prospective CIRCA clients may also be solicited to donate unworn jewelry to help fundraise for a cause. However, CIRCA’s model is to donate 10% of the purchase price of items that they buy during these events to the charity.

An alternative to CIRCA for some clients is to sell their jewelry at auctions, despite the privacy concerns discussed above. Both the famous auction houses, Christie’s and Sotheby’s, say that they are well aware of CIRCA’s business, though senior leadership at both houses declined to offer much comment on their relationship or competition with CIRCA. Sotheby’s Gary Schuler, Senior Vice President and Director of the New York Jewellery Department, said that “anyone who buys and sells higher end jewelry must be considered a competitor” but did not offer any comment on CIRCA’s distinguishing features. Rahul Kadakia, the Head of Christie’s Jewelry America said that Christies does not have much contact with CIRCA, but noted that “they are a well respected company with a special spot in the market.”

When CIRCA’s clients sell their pre-owned jewelry to CIRCA and CIRCA places those pieces back “onto the market,” they interrupt the conventional uni-directional jewelry supply chain. Under the usual arrangement, gems and metals are mined from the ground and sent to a diamond cutter or jewelry wholesaler. Once those components are transformed into jewelry, they pass through a retail outlet, which sells the finished pieces to the public. CIRCA and its immediate competitors are essentially recycling jewelry from the public and placing it back into the supply chain, where it can be resold to the public or dismantled to create a new piece. In this way, CIRCA is essentially “mining” jewelry from the public and from retailer’s overstock supply, reducing the need for newly mined materials from the ground. Though this practice can create a favorable environmental outcome, as discussed later in this case, CIRCA’s public “mining” also pits the company against firms that seek to profit from materials they mine themselves.

Given their place in the jewelry supply chain, and the effect that their business has on reducing the demand for newly mined materials, it is easy to see how CIRCA could pose a threat to mining and wholesale companies. One obvious competitor would be DeBeers, the world’s largest diamond miner and wholesaler. Though multiple players at CIRCA emphasized that it is not CIRCA’s desire to attack a mining company like DeBeers, nor is it their intention to try to put mining compa-nies out of business, relations could become tense as CIRCA’s market share con-tinues to increase. Director of Marketing and Communications Elizabeth Godfrey said that relations were “friendly”, but that CIRCA was definitely on DeBeers’ radar. CEO Chris Del Gatto acknowledged that CIRCA and DeBeers converse “for obvious strategic reasons” regarding future business opportunities, though

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he emphasized that CIRCA was under no obligation to collaborate with DeBeers. Instead, Del Gatto said that he sees these conversations as a means for DeBeers to keep abreast of CIRCA’s business development, and as a forum in which both companies can discuss potential synergies or future initiatives.

There are currently a growing number of jewelry purveyors that emphasize sustain-able materials and environmental responsibility. These companies may compete with CIRCA for some clients, though there may also be a potential opportunity for CIRCA to sell a portion of its jewelry inventory through such outlets of “sustainable” jewelry. Naturally occurring diamonds, gemstones and precious metals are finite resources that are financially and environmentally costly to extract. Appendices B and C outline some of the environmental effects of mining for jewelry. As a result of these environmental risks and tradeoffs, some jewelry companies have begun to define and market “green diamonds.” “Green” can mean different things to differ-ent people, however, as there is no commonly accepted definition of the term. In some cases, “green” jewelry is created from pre-owned diamonds or other jewels that have been re-set in recycled metals, though there is often no way of knowing the environmental conditions under which those materials were originally mined. A customer concerned about environmental impacts may also choose to buy cultured or synthetic, lab-created diamonds and gemstones. Finally, they might seek out jewelry mined with a code of environmental ethics regarding environmental pro-tection. Brilliant Earth, for example, is a San Francisco start-up that uses environ-mentally responsible gold and platinum, avoids conflict diamonds, and donates 5% of its profits “to help communities who have suffered from unethical practices in the jewelry industry.” Green Karat uses only lab created diamonds and appeals to couples that are interested in “loving each other and loving the planet, a marriage of values.” Customers can choose to recycle gold they already own for store credit, but cannot get cash payment for any pre-owned jewelry. CIRCA does not consider these companies to present a significant source of competition, as their business models are very different, however it seems likely that any client who might take an interest in CIRCA’s service for environmental reasons may also consider dealing with companies like those described above.

Development Plan

CIRCA is not the only buyer of pre-owned jewelry, nor is it alone in providing a high quality source of jewelry to collectors and other buyers around the world. It has, however, found ways to set itself apart from the competition. CIRCA is not the only buyer of fine jewelry that tries to create a luxury atmosphere and cater to a high-end clientele, but it is the only one of the high-end jewelry buyers to explore the effect that a more pronounced focus on environmental sustainability might have on company business.

Many jewelry re-sellers attract clients simply by offering liquidity in exchange for jewelry, but CIRCA sees an opportunity to frame their newest development strategy

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as “environmentally sustainable commerce” in order to further differentiate itself from its competitors. CIRCA is already one of the largest recyclers of jewelry in the world, and the company claims to be “committed to promoting sustainability by reducing the environmental impact of mining for precious metals and gemstones.” Ads and other promotional materials proudly declare that CIRCA’s philosophy is that “every diamond that is recycled is one less diamond that has to be pulled from the ground,” though the message does not currently go any deeper in explain-ing why this recycling might be environmentally beneficial. Appendices B and C provide further information on the environmental impacts of mining for jewelry.

CIRCA finds itself in a unique position. While the change in consumer attitudes has caused many luxury brands to change their business practices to be more en-vironmentally friendly, CIRCA has a business model that is, in effect, built around recycling. This is an aspect that the company has not, until now, emphasized in a concerted way. Going forward, CIRCA plans to focus a significant share of its mar-keting on a sustainability-focused message to potential clients. In just a decade, the company has already managed to successfully recast its business of buying and recycling pre-owned jewelry as a socially acceptable, luxurious service. It is now looking to capitalize on the heightened awareness of the luxury consumer towards sustainability.

Sustainable luxury has been given increasing attention in recent years, with luxury brands committing to codes of social and environmental responsibility, and high-end designers beginning to use sustainable materials. Even within the fashion industry, people are beginning to discuss the unique advantage that luxury brands have to be able to use their margins to create sustainable change through environmentally responsible production. In 2009 Francois-Henri Pinault told the New York Times that “today, more than ever, people want a return to genuine values, such as timelessness, sincerity and exemplary standards and these are all qualities which… are inherent in sustainable luxury.” As the chairman and chief executive of the French luxury giant PPR (which includes such brands and Gucci, Yves Saint Laurent and Alexander McQueen), Pinault set the tone for many others in the industry when he announced that it was his “deep conviction that sustain-ability creates value” and that he planned to make it a bigger part of his strategic vision for PPR. A move towards sustainability has been visible in other parts of the luxury world as well. Christie’s auction house has held multiple “Bid to Save the Earth” auctions to benefit environmental non-profits, and top fashion designers like Prada, Balenciaga, Burberry, Marc Jacobs, Diane von Furstenberg, Manolo Blahnik, Oscar de la Renta, Stella McCartney, Jason Wu, and Alexander Wang created sustainably-sourced items to compete in a March, 2011 fashion show called Runway Green.

Chief Operating Officer and board member Howard Sommer suggests that CIRCA’s recent increase of interest in sustainability derives from two sources. He confirmed that the current business marketplace is becoming more and more sensitive to envi-ronmental issues, and that the sensitivity of the business world to “the green issue” has “really accelerated” in the past few years. This trend has provided an impetus

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for CIRCA to act on an issue that Del Gatto has been discussing with the Board periodically for years, but which they did not feel would be profitable to pursue until roughly nine years after the company’s founding. Though CIRCA might have used a “sustainability” marketing theme from the outset in 2001, Sommer said that at that time, the world would not have been nearly as receptive to such a message as it is today. The other reason that CIRCA is now embracing an environmental theme in describing its function seems to stem from a genuine desire of the board members themselves to do, according to Sommer, “what’s right for the world.” The combination of Del Gatto’s urging and an increase in environmental awareness among company leaders seems, alongside the promise of increased revenues, to be steering the company towards a more environmentally conscious path.

By CIRCA’s calculations, there is a large untapped market of estate and antique jewelry in the United States just waiting to be sold back into their hands. Antique estate jewelry is currently estimated to make up only 1.2% of total jewelry sales, but the inventory of existing jewelry in the United States in 2009 was conserva-tively estimated at approximately $2.35 trillion, while the worldwide inventory was set at nearly $8.6 trillion (Derby 2010, Guthrie, 2011). If CIRCA can manage to capture even a slightly increased share of that pool, the company stands to sustain considerable growth.

Despite the “green” hype in the fashion world at large, most fine jewelry buyers have not yet begun to incorporate the rhetoric of “sustainability” or “recycling” into their marketing campaigns. Environmental sustainability is not an issue on the minds of most clients or buyers at auction houses, nor has it become a buzzword at other resale outlets like Windsor Jewels. When asked if Windsor had a policy on environmental issues or if it had sought any sort of environmental certification, a gemologist at Windsor in New York said that they are “not part of anything like that” and indeed that she “had never even heard of” such certification programs. The lack of interest and knowledge regarding these issues in the jewelry resale business is something that CIRCA hopes it will be able to change.

CIRCA plans to capitalize on public awareness of these issues, particularly amongst a higher-end clientele, and use the public’s growing interest in the planet to bolster their inventory of previously-owned jewelry. Del Gatto says that the current trends present CIRCA with a “tremendous opportunity… to reduce the need for mining” as well as to “do well by doing good.” He says he believes that it is CIRCA’s responsi-bility to get people to think about second uses for things (like fine jewelry) that they no longer use, and to encourage them to recycle those items rather than letting them take up space in a drawer while additional pollutants are spilled in the search for new metals and stones. Del Gatto was not shy about saying that clients “should feel the responsibility” to recycle jewelry they don’t intend to wear or pass along, and CIRCA is weaving this into the dialogue that buyers have with clients. Head of Buyer Training Angelina Chen emphasized the importance of language and phrasing when dealing with sensitive topics like jewelry resale. She said that the term “recycling” is “unglamorous” and unlikely to appeal to CIRCA’s current client base, but noted that clients respond very well when she tells them their jewelry will

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be “finding a new home” with someone else who will value it highly. These are the types of details that CIRCA will need to consider as it begins to develop a more in-depth, sustainability-focused marketing and educational campaign.

If CIRCA is serious about projecting environmental expertise and responsibility, it will do well to seek alliances with any number of the programs already in existence to help educate consumers and members of the jewelry trade about environmen-tal sustainability. The certification program offered by the Responsible Jewellery Council, for example, aims to “advance responsible ethical, social and environ-mental practices, which respect human rights, throughout the diamond and gold jewellery supply chain” and is open to “all businesses and associations participat-ing in the diamond and gold jewellery supply chain and/or engaged in activities that have a potential impact on consumer confidence in diamond or gold jewellery.” By this wide-reaching definition, CIRCA would certainly be eligible for membership status. Appendix D shows the exact working of the RJC’s environmental policy and lists the components of the council’s strategy to improve environmental respon-sibility in the industry. The Chief Operations Officer at the Responsible Jewellery Council would not offer comment on trade in the jewelry industry, or how buyers of pre-owned jewelry like CIRCA might fit into the RJC’s certification schemes, but said that organization is chiefly focused on “how our members measure their business practices against the RJC’s Code of Practices and certifying those members against the RJC Standard.”

There are numerous organizations with similarly aligned missions in which CIRCA might increase its participation. The World Jewellery Confederation is tasked with protecting consumer confidence in the industry and serving as “ a centre of knowl-edge, a decision-making body, and an advocate for the well being of the jewellery industry worldwide,” and therefore works to provide educational materials for the public as well as those within the industry regarding sustainable environmental practices. The Madison Dialogue is a collaboration between jewelry companies, civil society groups and others “seeking to encourage best practices, sustainable economic development, and verified sources of responsible gold, diamonds and other minerals.” The Initiative for Responsible Mining Assurance has similar goals as the Madison Dialogue group but is based in Canada (though it also includes American companies).

To date, CIRCA has not participated in any of these dialogues, certification programs, or industry initiatives, which have tended to focus on the impacts of mining from which CIRCA is buffered as a second-hand buyer and trader. Were the company to take an interest in participation, however, CIRCA could almost certainly find a place at the table in the majority of these industry-wide and stake-holder conversations. In fact, CIRCA’s lack of participation in any of these ongoing initiatives may raise questions given their interest in environmental issues and sus-tainability-motivated marketing. As sustainability is not currently the primary motive behind client sales at CIRCA, and the company has just begun to use marketing

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slogans regarding sustainability, company executives recognize that this casual reference to sustainability will need to become more concrete as CIRCA’s new marketing campaign evolves. The company commissioned an academic study on the environmental effects of mining for gemstones and precious metals in 2010, and they are drawing much of their current messaging from the findings of that report. CIRCA is following that initial report with a more in-depth study on diamond mining, which will become a major part of its messaging to the public after its completion. The next section will discuss ways in which CIRCA might enlighten its clients as well as its employees about CIRCA’s contribution to making the industry more sustainable, and suggest how it might go about gaining credibility through participation in one or more such industry dialogs or certification programs.

Enhancing A Message Of Sustainability

CIRCA’s leadership has identified three things that an increased emphasis on “sustainability” can do for their business and for the industry as a whole. First, as CIRCA increases public awareness of the link between selling unworn jewelry back into the marketplace and reducing the need for mining, the concept of “re-circulating” unworn jewelry will become part of the public vocabulary. CIRCA then plans to encourage environmentally-minded people to sell their unworn jewelry, thereby increasing the pool of jewelry and gemstones available on the secondary market. Finally, as consumer behavior shifts, more jewelers will specialize in estate pieces or use previously- worn gemstones in their designs, meaning less industry dependence on newly-mined materials.

Though CIRCA has begun to talk about the concept of “sustainability,” it has yet to participate in any of the wider industry efforts to actively promote jewelry “re-cycling” for its environmental sake, nor has CIRCA yet begun a fully-developed marketing campaign specifically designed to attract the kind of “social responsible consumers” just mentioned. The concrete steps that CIRCA has already made in spreading its sustainability message is incorporating language within its current ad campaign, featuring sustainability on its social media platform (including a blog, a Facebook page, and a Twitter account), sponsorship of events, and internal initia-tives to reduce the company’s carbon footprint and environmental impact.

Instead of just a single post on Earth Day in 2011, CIRCA featured an entire “Earth Week” on its public blog. This online space acted as a forum for CIRCA to highlight its own contribution to sustainability in the industry, and also to show support for other jewelry and fashion designers who are working with sustainability in mind. Some of the features included interviews that CIRCA had conducted at the lounge it sponsored at New York’s most recent Fashion Week, where CIRCA representatives asked various industry personalities to state why sustainability was important to them. Most interviewees made basic statements that showed they were more interested in sustainability as a trend or perhaps as a means to gaining an edge in business, and not because of any stand-alone environmental concern. Nevertheless, these interviews, placed prominently on the CIRCA blog,

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help the company begin branding itself as an environmentally conscious opera-tion. In late February 2011, CIRCA also helped to sponsor the Hollywood Dominos Gala, an event where they “took the opportunity to introduce our own sustainability message to Hollywood.” Guests were driven to the event in Mercedes-Benz Hybrid sedans, and took away a new awareness of CIRCA’s commitment to environmen-tal issues, with a tangible reminder in the form of 100% recycled silver bracelets with “Worth More” engraved in the band. At the most recent New York Fashion Week in September, CIRCA used the CIRCA Accessories Salon at Lincoln Center to showcase the work of emerging jewelry designers, the majority of whom incor-porated sustainable practices and materials in their jewelry designs.

These one-time events are positive steps towards CIRCA’s goal of developing a sustainability outreach campaign, but they do not constitute complete strategies. CIRCA has plans to launch a full environmentally-themed marketing strategy in the fall of 2011, though as early as August 2011, a portion of the company’s regular half-page adds in the New York Times had begun to feature an environmentally mindful wording.

In addition to their outward-looking “sustainability” campaign, CIRCA will also need to take steps to educate its own buyers and office staff on the topic and how to discuss the subject with clients. According to Singer, there is currently no formal training program devised for internal education on the topic of jewelry recycling or sustainability. Though the structure of CIRCA’s buyer training program and its regular company-wide meetings would seem to provide a natural forum for such education, CIRCA has not yet designed any internal training materials in this regard, in part because its staff are already confronted with an overwhelming volume of work as the business continues to grow rapidly. Director of Marketing and Communications Elizabeth Godfrey argued that since recycling has always been a part of CIRCA’s business model, little additional training should be needed beyond making sure buyers are comfortable discussing the topic of sustainability with their clients.

CIRCA has already taken some concrete steps toward improving in-office sustain-ability. Employees were eager to report that they had been limiting their use of air conditioning and paper, never use toxic chemicals to clean jewelry, and switching to a forest-council certified brand of paper for necessary office products. Although the company’s internal efforts regarding sustainability have been “top down,” Angelina Chen says that she thinks the company culture is such that most employees were interested in learning more about the small things they can personally do to help lessen CIRCA’s environmental impact. “They hate me in inventory,” she added proudly, because she insists that cardboard FedEx boxes get crushed individually before disposal.

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A New Strategy And The Challenge Of Change

A disconnect remains between Del Gatto’s goal of getting prospective clients to “feel the responsibility” to recycle jewelry and the reality of what clients know about why this responsibility is important to the environment. Del Gatto believes that young people today feel a “sense of mission” about sustainability and that they understand its importance, though he also admits that “I don’t think there is any awareness right now” in CIRCA’s own client base about the positive environmen-tal effects that CIRCA has when it “recycles” fine jewelry. Clients do not typically mention sustainability as a reason for selling jewelry to CIRCA, though this could change if the new marketing campaign is successful.

What CIRCA really needs to accomplish is to make prospective clients feel em-powered to “help” CIRCA put more used jewelry back on the market and reduce the demand for additional mining. The new campaign will try to tap into a base of “conscientious consumers who buy locally grown food, organic cosmetics, recycled households products, energy efficient electronics, and other sustain-able goods,” who would be interested in purchasing the kind of recycled, high-end jewelry CIRCA places back in the market (Guthrie, 2011, 3). CIRCA does not cur-rently keep records of clients’ level of knowledge of sustainability issues, though they may consider using an intake questionnaire or another method of gathering data on client’s knowledge of sustainability issues in order to track the efficacy of their new marketing campaign. The Director of Marketing and Communication is also serving as the point person for the new sustainability initiative.

The new marketing campaign is set to begin in earnest in autumn 2011, and will include a prominent sustainability message in each add. According to Del Gatto, the ads will feature either a “full sustainability” message, or at the minimum, will include a “touch point” on some aspect of sustainability. According to Director of Marketing and Communications Elizabeth Godfrey, it will be critically important that CIRCA project a “positive message” to clients, despite the grim nature of the environmental destruction CIRCA is working to prevent. Godfrey is adamant that CIRCA is “not looking to shut down the jewelry industry or to close mines,” though one must conclude that this may happen on a small scale if CIRCA is successful in gaining the market share they’re striving to achieve. Godfrey has been develop-ing a list of environmentally related “talking points” that will help CIRCA buyers in keeping that critical positive tone in their interactions with clients. For example, a buyer might wait until after a sale is complete, then hand the client a certificate that says something like “Congratulations! You’ve just helped to save ___ ” and insert any number of relevant environmental statistics depending on the metals or gemstones contained in the pieces that the client agreed to sell to CIRCA. Though receiving this certificate might make a client feel good, or even encourage them to come back again, the timing of the certificate relative to the sale does not allow this mechanism to act as an environmental incentive for clients to sell to CIRCA.

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In order to conduct a convincing marketing campaign, CIRCA needs data and pro-jections that show the magnitude of environmental impact the company could have. The company has commissioned the above-mentioned report to help quantify the impact that CIRCA can have on the world diamond trade, as well as a document outlining the environmental problems created by mining. The challenge now will be to create educational marketing materials that distill this information for the general public, and that are able to discuss difficult issues in a way that empowers prospective clients to want to participate in reducing the demand for new mining. Throughout this process, CIRCA will continue to emphasize creating a luxurious and pleasant customer experience. It will also continue to prioritize an economic and geographic expansion for the business as a whole.

CIRCA also has plans to put together a group of “stakeholders” to consult during about its environmental initiative . Though no formal invitations have been made, CIRCA plans to hold a policy forum with selected NGOs and environmental activ-ists in order to present the company’s findings from their afore-mentioned study on the positive environmental impact of re-circulating the current stock of diamonds in public hands back into the market. According to Godfrey, this forum will “get their comments and buy-in” regarding CIRCA’s initiative to educate the public about the environmental benefits of recycling their jewelry. This panel will be tasked with advising CIRCA on how best to cultivate a positive public image with respect to the “sustainable” nature of the jewelry reuse business. CIRCA also plans to use this panel to help it select one or more visible environmental charities to support. Del Gatto expressed the view that “the right NGO can be a very good soapbox” from which to send an environmental message, and added that he hoped the stake-holder panel would help CIRCA find an appropriate celebrity spokesperson to help with their educational campaign.

Based on the steps it has taken thus far, it is clear that CIRCA will pursue an en-vironmental branding to the extent that it will help increase profits and expand the company’s client base. The motivation behind the new marketing campaign is pri-marily profit driven, but the fact remains that CIRCA is providing an environmental service by reducing the need for additional mining. In formulating a new strategy to promote the company’s sustainable business, CIRCA will look to take advantage of the increasing public support for sustainability initiatives, and will seek to clarify the way that the company’s existing function is “environmentally friendly.” CIRCA should be able to leverage its existing advantages (a loyal client base, a rigorous buyer training program, a global network of contacts with information on prices and prospective buyers, and a base location in trendy New York City) to make its inherently “sustainable” actions help increase company business. As CIRCA further develops this strategy, the company leaders will need to find ways to take advantage of the momentum in support of sustainability that has taken hold in today’s luxury world, and continue to develop more concrete plans for how their own company can use a sustainability angle to appeal to prospective clients.

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Appendix A

CIRCA’s organizational structure as of August 2011.

Chart provided by CIRCA.

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Appendix B

Environmental Impacts Of The Jewelry Industry

The social problems associated with mining for the jewelry industry have been increasingly visible in an age of conflict diamonds, tightening labor laws, and the Patriot Act. The environmental implications of the jewelry trade are often less well-known, but they exist all the same. Some industry leaders have begun to develop “best practices” programs (like the DeBeers “Best Practice Principles Assurance Programme”), but no matter how “holistic” these practices claim to be, it is difficult to deny the sheer volume of water, fuel and chemicals needed to mine and process most previous metals and gems. Producing one ounce of gold creates average of 20 tons of mine waste (Giffort et al 2010) and large gold mines use tons of cyanide each year (No Dirty Gold Campaign, 2010). The smelting process for silver and platinum releases lead, cadmium, copper, zinc, arsenic, iron, sulfur into the envi-ronment. Mining also creates deforestation and other habitat destruction, releases toxic chemicals into water and air, creates toxic tailings and mine waste, requires inputs of high energy, and often prompts the construction of roads and settlements in previously undeveloped wild areas. The effects are especially painful in impov-erished developing countries, where an estimated 80% of color gemstones are mined on a small-scale (Cross et al 2010 and Gifford et al 2010).

If demand for newly-mined metals and stones declines, existing mines might close, but their environmental impacts can continue on for decades after a closure. Closed mines can still cause persistent soil, air, and groundwater contamination and result in biodiversity losses and other health effects for human and animal populations (Miranda et al 20003, Shevenell, 2000). Demand-related mine closures may also be subject to reopening at any time. For example, DeBeers shuttered a significant number of mines during the 2008-9 economic recession, but in 2010 reported that new water usage increased by 63 percent over 2009 volumes “due to increased production as the market recovered.” They also reported a 48 percent increase in total energy use between 2009 and 2010, as well as a 32 percent increase in carbon dioxide equivalent emissions (Debeers. Living Up To Diamonds, 5).

The following table, taken from Miranda et al. 2003, summarizes the wide range of environmental impacts of mining for the jewelry industry.

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Appendix C

The following table compiles data from Guthrie (2011), Glaister and Mudd (2010) and Mudd (2007) to show the magnitude of emissions attributable to gold and platinum mined for jewelry.

Gold (per tonne of ore) Platinum (per tonne of ore)

Water consumption 1,420,000,000 liters 1,780,000,000 liters

Greenhouse gas emissions

21,700,000 kg CO2e 35,600,000,000 kg CO2e

Energy consumption 311,000 GJ 145,640,000 GJ

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Appendix D

Responsible Jewellery Council

Environmental Policy

October 2008

Introduction

The Responsible Jewellery Council is committed to minimising its impact on the environment.

As well as the commitment of Council Members to environmental performance through the RJC Principles and Code of Practices, the Council seeks to address environmental issues in its own activities.

Application

The Environmental Policy applies to the members of the Council’s Management Team, who are based in a number of small offices globally.

Copies of this policy will also be made available to service providers, where appropriate, who should consider applying similar policies.

Strategy

The Council aims to:

• Minimise waste by evaluating its activities and ensuring they are as efficient as possible.

• Minimise greenhouse gas emissions through use of credible sources of renewable energy.

• Actively promote recycling internally and through the selection of goods and services.

• Meet or exceed all the environmental legislation that relates to the Council’s activities.

• Minimise travel through the utilisation of telecommunication technologies.

• Use an accredited program to offset the greenhouse gas emissions generated by unavoidable travel.

Approved: Matthew J Runci

Chairman, Responsible Jewellery Council

The Responsible Jewellery Council is a trading name of the Council for Responsible Jewellery Practices, Ltd 20-22 Bedford Row, London, WC1R 4JS, United Kingdom. Company Registration No. 05449042.

The Responsible Jewellery Council’s Environmental Policy as of 2008. Accessed at http://www.responsiblejewellery.com/downloads/RJC_Environmental_Policy_Oct_2008.pdf.

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References

Ali, Saleem. Personal communication.

Brilliant Earth. About Us. http://www.brilliantearth.com/about_us/

Chen, Angelina. Personal interview June 28, 2011.

CIRCA press packet. “Chris Del Gatto Co Founder, Chairman & CEO CIRCA. Full bio.”

CIRCA. Circajewels.org. Accessed August, 2011.

Cross, Jamie, Sanne van der Wal, and Esther de Haan. 2010. “Rough Cut: Sustainability Issues in the Coloured Gemstone Industry.” Amsterdam, NL: SOMO Centre for Research on Multinational Corporations.

Debeers. “Living up to diamonds: Report to society 2010 Full Report.” Available online at www.debeersgroup.com/Global/RTS10%20-%20Summary%20Review.pdf.

Del Gatto, Chris. Personal Interview June 29, 2011.

Guthrie, Doug. 2011. “The Environmental Impact of Mining Minerals and Gemstones: The Case for Putting Jewelry Back into Circulation.” Unpublished manuscript.

Derby, Sarah-Jane. 2010. “Jewelry Stores in the US, Industry Report 44831.” IBISWorld.

Glaister, Bonnie J., and Gavin M. Mudd. 2010. “The environmental costs of plati-num-PGM mining and sustainability: Is the glass half-full or half-empty?” Minerals Engineering 23(5): 438-50.

Gifford, Blair, Andrew Kestler, and Sharmila Anand. 2010. “Building local legiti-macy into corporate social responsibility: Gold mining firms in developing nations.” Journal of World Business 45(3):304-11.

Godfrey, Elizabeth. Personal Interview. June 28, 2011.

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Green Karat. Our Philosophy. Online at http://www.greenkarat.com/about/philoso-phy.asp.

Haughney, Christine. “It’s Not So Easy Being Less Rich.” The New York Times. Sunday June 1, 2008.

Hubbard, Lisa. Personal communication. Email July 18, 2011.

JQ International Trends in Fine Jewelry. CIRCA Jewels Unveils Online Presence with CIRCA at Bluefly. Posted on 9 August 2009. http://www.jqintl.com/ME2/dirmod.asp?sid=&nm=&type=MultiPublishing&mod=PublishingTitles&mid=6EECC0FE471F4CA995CE2A3E9A8E4207&tier=4&id=193C1D4CEEA94E99935A8B4B23352432.

Kadakia, Rahul. Personal communication. Email July 18, 19, 2011.

Kahn, Jeremy. 2009. “Luxury-Good Makers Embrace Sustainability.” The New York Times. 26 March. Online at http://www.nytimes.com/2009/03/27/business/worldbusiness/27iht-sustain.html%20NY.

Lingon, Daphne. Personal communication. Email July 18, 2011.

Madison Dialogue. Available online at http://www.madisondialogue.org.

Miranda, Marta, Philip Burris, Jessie Froy Bingcang, Phil Shearman, Jose Oliver Briones, Antonio La Viña, Stephen Menard, Nathan Kool, Sylvia Miclat, Charles Mooney, and Annabel Resueño. 2003. “Mining and Critical Ecosystems: Mapping the Risks.” Washington DC: World Resources Institute.

Montgomery, Michael. Supply Shortages May Herald in era of ‘Peak Diamond.’ Diamond Investing News. 3 May 2010. Online at http://diamondinvestingnews.com/1949-supply-shortages-may-herald-in-era-of-‘peak-diamond’.html.

Mudd, Gavin M. 2007. “Global trends in gold mining: Towards quantifying environ-mental and resource sustainability.” Resources Policy 32(1-2):42-56.

No Dirty Gold Campaign. 2010. “Tarnished Gold? Assessing the jewelry industry’s progress on ethical sourcing of metals.” Washington DC: Earthworks.

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Responsible Jewellery Council. About Us. http://www.responsiblejewellery.com/about.html.

Schuler, Gary. Personal communication. Email July 18, 2011.

Shevenell, L. A. 2000. “Water quality in pit lakes in disseminated gold deposits compared to two natural, terminal lakes in Nevada.” Environmental Geology 39(7):807-15.

Singer, Jeffery. Personal Interview. June 28, 2011.

Sommer, Howard. Personal Interview. August 9, 2011.

Sproule, Catherine. Personal communication. Email July 8, 2011.

Tang, Syl. “Secret sellers: Appealing to the cash-strapped divorcee” Financial Times; 9. Saturday, June 13, 2009.

Wassarman, Beth. Personal communication. Email July 18, 2011.

Weir, J. N., S. P. Mahoney, B. McLaren, and S. H. Ferguson. 2007. “Effects of mine development on woodland caribou Rangifer tarandus distribution.” Wildlife Biology 13(1):66-74.

World Jewellery Confederation. Mission Statement. Online at http://www.cibjo.org/index.php?option=com_content&view=article&id=1&Itemid=2.

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Teaching Note: CIRCA Case Study

Case Summary for the Instructor:

This case provides a description of a firm called CIRCA that buys pre-owned fine jewelry from the public as well as from retail outlets. The case describes the founding and evolution of CIRCA’s business, with descriptions of the company’s culture, organizational structure, and methods of distinguishing themselves from any potential competition. Students will understand how the company operates, and be introduced to the positive environmental implications of “mining” jewelry from the public. Appendices with a brief summary of the harmful effects of new mining are provided, in order that students will better understand the potential en-vironmental harm avoided by recycling unused jewelry.

In light of the increasing trend in the luxury world towards “green” business, CIRCA is looking to capitalize on the nature of its current business to attract more clients though a sustainability-based marketing campaign. This case introduces CIRCA’s rationale behind this decision, and outlines the company’s progress thus far towards its goal of “sustainable” branding. Students read concrete examples of actions the company has already taken, and are prompted to consider what ad-ditional action is needed in order for CIRCA to realize the full potential of its new marketing campaign.

Questions for Discussion:

The instructor might consider raising the following discussion topics in order to enhance students’ understanding of the information contained in the case:

• Why is CIRCA now focusing on sustainability, when they have not done so in the past?

• Do CIRCA’s clients value environmental sustainability? Why or why not?

• How does CIRCA manage its relations with DeBeers and other potential competi-tors? Does CIRCA present a legitimate threat to DeBeers?

• What role does CIRCA intend for the stakeholder panel to play? Do you think this role is appropriate?

• CIRCA has emphasized the need to reach clients with a “positive message” about sustainability. What would be the problem with a negative message? Is there a

place for that type of message in their campaign as well? Why or why not?

Supplementary Exercises:

The instructor may choose to assign the following activities in order to provoke discussion and stimulate student creativity with respect to the CIRCA case. These activities will require more time than a single class session, so it is recommended that they be used as homework assignments to accompany the case discussion.

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For the purposes of all the following exercises, have students take on the role of “consultants” to CIRCA, and stress that they provide justification for their recom-mendations grounded in the case material itself, in addition to any supplementary sources they may choose to cite.

1. There are many ways that CIRCA could improve its environmental marketing strategy. Suggest a new target audience for CIRCA’s marketing materials, and outline a strategy to reach those potential clients.

2. Who should CIRCA invite to sit on its environmental “stakeholder panel”? Make a list of eight possible candidates and explain why such a position might appeal to the candidates, as well as how they might help CIRCA increase its business.

3. Design a training module on some aspect of sustainability in the jewelry industry that will be incorporated into CIRCA’s buyer training program. Assume that trainers will spend two full days on this module.

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