Discount wholesale club Costco (COST) sells Tiffany engagement rings. Sorry, “Tiffany” engagement rings—diamonds set in silver bands that look like real Tiffany & Co (TIF). rings and are even called “Tiffany” at the store, but which have nothing to do with the upscale New York jewelry store. Tiffany & Co. says the rings falsely imply that they’re from the same store, and is now fighting Coscto in a multi-million dollar trademark suit that seeks to determine whether Tiffany has become the Kleenex of diamond rings, or if it refers specifically to the store that’s actually called Tiffany’s.
Unlike Walmart, which sells diamond rings for only a few hundred dollars each, Coscto’s rings cost upwards of $40,000. These lavish prices put the wholesaler, which is known more for its bulk grocery items and free samples of food than for luxury goods, in direct competition with expensive jewelers. We were curious: Is a Costco ring worth it?
On a WeddingBee.com message board, when a woman asked for others’ opinions of Coscto jewelry, most of the replies came from women who said they weren’t opposed to a Costco diamond, but they weren’t really for it, either. “I love Costco for grocery items but I have never even thought to look at their rings,” one woman replied. Another said she thought about shopping there but that, “I was concerned everyone would ask where we got the ring.”
The assumed benefit of a Costco ring is that even at $40,000, you’re getting a higher quality diamond than you’d be able to afford at a more prestigious store. Like any other name brand product, Tiffany & Co.’s reputation (not to mention the classy Audrey Hepburn endorsement) raises the price of its jewelry.
Meanwhile, that Costco diamond might actually be worth more than its price tag. In 2005, Good Morning America appraised both a Tiffany diamond and a Coscto diamond. As it turned out, the $16,600 Tiffany cut was 58% more expensive than its $10,500 value while the $6,600 Costco version was actually 17% under its appraised value of $8,000. On the WeddingBee.com blog, several women admitted to having a Coscto rings and said that when they had them appraised, every single ring was worth more than they paid, sometimes by multiple thousands of dollars.
Tiffany & Co. offers more services than Costco. Its expert jewelers will teach customers about the different cuts and qualities of diamonds. Once a ring is purchased, it can be returned for cleaning or re-sizing at any time. Costco doesn’t re-size rings. But it does sell six-pound packages of cheese.
