Prepare for Takeoff: Next-Generation Marketplace Jet.com is Ready to Change the Game
It's a bird, it's a plane … it's Jet.com. Flying high and ready to disrupt the e-commerce world, Jet is a revolutionary marketplace that's taking a new approach to online retailing by using a membership-based business model (think an online Costco or Sam's Club). If you're an online retailer, you might want to take notice.
What if you could sell on a marketplace that did all the work up front to deliver items at the lowest possible costs? What if you could offer shoppers a discount for different incentives — e.g., a larger basket size or in-store pickup?
Jet founder and CEO Marc Lore wants to provide all this and more. Lore is no rookie in the e-commerce space, having started Quidsi (parent company of Diapers.com) before selling it to Amazon.com in 2010 for $550 million. Lore then worked at Amazon for two-and-a-half years before moving on.
After paying a $49.99 subscription fee, Jet shoppers will be able to access products and merchandise with prices that Lore says will be 10 percent to 15 percent lower than anywhere else online. Jet members can shop for items in categories such as electronics, home goods, consumables, appliances, sporting goods and more.
The Jet Vision
Jet's goal is to offer a unique experience for both sellers and buyers that differentiate it from other e-commerce sites. The company hopes to build a fair marketplace where value wins out. Jet doesn't appear to be the only one buying into this business model; Lore and his team have already raised $220 million in financial backing.
Jet's consumer value proposition can be summarized in three words:
- Quality: By working with trusted brands and retailers, and backing them up with a satisfaction guarantee, Jet offers a no-risk value proposition for customers.
- Transparency: Jet plans to reduce unnecessary costs in the existing systems that current online marketplaces use.
- Experience: Jet is making a substantial investment in the consumer experience. From search to buying, delivery to customer service, Jet's goal is nothing short of an exceptional customer experience.
The Jet E-Commerce Model
Like a warehouse club model, Jet plans to drive its profit from the $49.99 annual subscription that members pay. Jet operates its marketplace at cost and covers payment processing and other operational expenses as part of commissions that sellers pay. The remaining commission is used to drive consumer behavior in ways that reduce retailer costs. This is accomplished via preset rules that retailers use for shipping, email opt-in, cart value, returns and more.