Unlike the success of  Amazon.com, online diamond seller Blue Nile (NILE) has more or less performed flat over the last decade.

In this clip, Motley Fool co-founder David Gardner talks to Sean O'Reilly and Vincent Shen about why the company is a pick on The Motley Fool's Rule Breakers newsletter service, what makes diamonds less suitable for e-commerce than, say, computers or books, and what Blue Nile is doing to step up its game.

Listen to the full podcast by clicking here. A transcript follows the video.

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This podcast was recorded on Jan. 19, 2016.

Sean O'Reilly: My mother and my sister will love that this company is a pick by the Fool, which is Blue Nile. Really quickly, why is it a Foolish company? Aren't they in the "penalty box" for Rule Breakers? And what the heck is a web room?

David Gardner: Okay. Blue Nile is a company that's one of our longest-running recommendations at Rule Breakers, and that's bad news, because it's not been a great stock. So it's still kind of sitting about where it was...

O'Reilly: Hanging out there, yeah.

Gardner: ... in 2004, when I first picked it. I have owned shares all the way through, so I've just sat on a lemon. It had a really good first few years with Mark Vadon, who was the founder. It proceeded really well. He left the company and went on to start zulily. He made a lot of money through that. Public-market investors didn't do so well with that company -- nor have public market investors done really well with Blue Nile.

But I do like the company. I think the reason you're talking about your mother and your sister and your wife being happy that you were talking about this is that this is the engagement ring company, it's jewelry online. I mean, it's a good business. The problem is, it's had very little growth. I was taking it at a time when I thought they would make real inroads into Tiffany and others. Kind of the traditional "using online to defeat bricks and mortar." But it's not really happened. I think part of the reason is, a company like Tiffany has such a strong and revered brand that it can't be as well undermined by the online medium as many other verticals in retail.

O'Reilly: Yeah, and it almost seems like you want to buy certain things in person, no matter what. And an engagement ring is the perfect example.

Gardner: I'm still -- Vince, go ahead.

Shen: Well, I think that feeling definitely extends...

O'Reilly: Vince is recently engaged, by the way.

Gardner: Yes. Were you a buyer?

Shen: I was not a buyer. I had an heirloom ring.

O'Reilly: Oh, I'm sorry, I apologize, I thought...

Gardner: Beautiful.

Shen: But I have been doing the research, just out of curiosity. And it's true, the higher cost of the item, the more I feel like there's going to be greater reluctance to pull the trigger, click the mouse, submit your payment. And I think that's part of the reason why they've introduced the idea of the web room, and why they're trying to expand on that, to give people that physical, in-store presence, to be able to handle some inventory, because spending those several thousand dollars or even more, it can be hard when you don't actually see it in person. And with something like a diamond, where the way it plays in the light and the clarity and all these things, it might not translate that well on your computer screen, frankly.

O'Reilly: Cool.