Not online has won a $80 million investment, the amazon five challenges Jet

note: hunting cloud believe you’ve heard the project launched a small angels, but have never heard of before as Jet.com online. 80 million investment. According to after hearing, founder of interpretation, some people think that it will be have the potential to be launched over the past 10 years the most ambitious of e-commerce sites, and even let amazon CEO bezos of anger. The following for Re/code coverage, tencent technology translation:

if from the point of view of advertising, Jet.com seems to have become the best in the field of the current e-commerce industry website. The site created by a co-founder of Diapers.com, has raised $80 million in investment. However, Jet.com has not yet officially launched. Some middle-level staff have been added to the site, in fact they also didn’t exactly know what these shopping sites through what way to carry out the work. Under such circumstances, the Jet will attract the investment of investors as well as many employees, mainly with the company’s chief executive, mark raul (Marc the Lore) won the trust of the parties concerned. Raul had to sell the parent of maternal and infant products website Diapers.com Quidsi to amazon, market price of about $550 million.

a few days before, raul talked about the new company. After hearing the raul’s explanation, some industry insiders believe that Jet.com has the potential to be a thing of the past 10 years to launch the most ambitious of e-commerce sites. This sounds a little weird. People can not help but ask, really? This would allow the amazon CEO Jeff Bezos (Jeff Bezos) angry? May, of course, but in any case, Jet.com indeed reflects the raul’s ambition.

from the point of view of high-level, Jet.com is trying to re-establish the Costco membership club models in the network. Jet.com is an online marketing market, on this site, like the online shopping website TigerDirect.com, and other hundreds of similar sites such as the size of the retailer can sell their goods. Jet website will sales ranging from sports equipment to the cleaner to cereal to everything, sneakers, etc.

consumers to shopping on Jet website, every year will have to pay the membership fee of $50. In return, the Jet will these members return shoppers usually expect discounts: network the lowest price, and has always been like this. According to Jet estimation, this approach can make an average consumers save $150 a year.

in the present process, the Jet will try to attract consumers on the amazon site, as well as to attract consumers who don’t often online shopping. Here are Jet site plan of 5 kinds of schemes, Jet through the five kinds of schemes to implement the initial dream, including called Jet, Anywhere in the program. This is raul publicly for the first time and Re/code talk Jet Anywhere.

the first scheme: cheap

raul said that Jet website commodity prices, on average, will be better than all the other sites (including amazon) overall price 5% to 5% cheaper. Therefore, raul also and part of the industry on Jet website and other website of diapers and cleaner to compare the prices of goods such as, it has been proved that the price of Jet.com is lower. , industry insiders and online search the Sonos Connect equipment, concurrent now Jet.com for $301, the price of this device is much lower than the price of all other e-commerce site, while in other e-commerce site, the lowest price is $349. Members of the club like Costco can at a low discount prices to sell goods, mainly because consumers always buy wholesale goods. However, this is not the Jet method. So, how can Jet bear such high discount?

raul said, when retailers selling goods on the Jet, every sales to Jet a commission. The specific amount of commission according to the product type and is not the same, but is more or less of this amazon commission mode (amazon extraction percentage range from 8% to 15%). Next, the Jet will receive these commissions, and then use these commissions to fund all discount consumer first. Jet plan is only as the only profit channel through membership fees, rather than to sell the goods from the site to get commission as its revenue streams.

raul said: “we are on the website of all basic goods sales in accordance with our cost price, at most only a little bit higher than the cost.”

number two: more discount

this is the beginning of the discount strategy. Raul said that if consumers ordered a few items at the same time, so they can save the cost of 10% to 15%. Is the way it is, if consumers ordered many items at the same time, Jet technology will be behind the scenes to search, to find a retailer is one of the two goods in warehouse. If this is the case, then the Jet system will automatically apply for more discount, because it to the user delivery cost effect will be higher.

the Jet system will also be looking for a warehouse closer to home consumers, so it can give consumers shopping play more discount again. All these happened behind the scenes, and shoppers in the shopping cart to add more new product, you will see more discounts shown in heaps. Raul said: “is not to say that the way we delivery more intelligent. In fact, we are to show the real deep economic factors. If we will be announced the discount more transparently to the customers, so we can effectively increase more effective order.”

there are more price cut. If user use credit card or bank card to pay, rather than a credit card, so the Jet will also be able to play more discount, because if consumers do not use a credit card payment, the Jet will only need to pay for less payment processing. In addition, if a user will tell E-mail address to the sellers, that also can get more reduction opportunities. Every retailer to provide a business Jet, decide which goods order what kind of discount can be obtained.

the third way: fast delivery

if the order price is not less than $35, so consumers can enjoy the free shipping discount. If the order is lower than $35, so consumers will need to pay $5.99 shipping fee. Orders for most commodities, often in three to five working days after the performance.

however, for consumer goods, such as paper towels, grains and toothpaste, etc., it will take less than two working days to Jet aspects can the goods sent to the hands of consumers, this very much like Amazon Amazon Prime service, but also does not charge any additional fees. Jet was able to do so, mainly because the company has two warehouse (soon there will be three), the geography effective area to store these goods.

in addition, the Jet also believes that shoppers really hope, also need to get these goods faster. At least compared with the camera or a toy car, consumers always want to get faster paper towels, grains and toothpaste and other similar products.

4 kinds of solutions: help shopping guarantee supply

raul said: “this is a very simple brand promise. Consumers pay $50 a year, to purchase any goods can save money.” Feeling that sounds good, but also has a problem: Jet website once launched, but the sales quantity will be millions of, at the appointed time, how can the Jet to let consumers to purchase each item can save the cost of commitment? To this, raul believes that his company had the answer. If consumers on the Jet website search a product, but failed to find the goods, then Jet companies can still make consumers continue to order the goods. After that, the Jet website will help consumers to purchase the goods, but also provides consumers with some special discount, however, raul did not disclose specific number of such discount. This strategy is worth attention, because it is unclear what the Jet will be how to implement this strategy on a large scale.

5 kinds of solutions:

this is a final solution. Every large online shopping sites had never want to be able to sell these through its own store or website channel sales of commodities of the popular fashion brand products of the company. Amazon in this effort, however, ended in failure. Jet aspect also knows about it, they may also face the same fate.

however, Jet has introduced an affiliate program, called “Jet Anywhere”, the program will offer rewards to Jet members, as long as these members in affiliated with Jet Anywhere retailer website shopping plan. For example, if the members of a Jet site at Gap or j.crew (that is, the so-called raul has signed a contract with Jet Anywhere project cooperation of the two brands) website to buy some goods, then shoppers will receive a Jet integral card, can exchange and the volume of 20% to 30% of the value of the goods. Raul said: “this is a special kind of reward, this allows consumers to easily buy goods in our web site.”

in general, the value of the Jet proposal sounds impractical, difficult to achieve, perhaps this was the case. However, for an entrepreneur, it is full of great opportunities, of course also faced with enormous challenges. Amazon, for example, may be on their website the same popularity as the Jet website commodity big price cuts, and may be treated as Diapers.com, to squeeze the Jet from the industry. In addition, the Jet may also found that the company’s business model is difficult to attract many U.S. consumers, as more users want to get a faster delivery service, or a Jet of a wide variety of discount method makes consumers dazzling, overwhelmed. In any case, any one of these reasons will make Jet face larger the struggle to survive, and only by the membership fee is used to implement the company’s profit way will face a bigger dilemma.

maybe, raul’s concept of the cost is very expensive, and lead to can’t perform. After raul said that Jet company has plans to spend $500 million over the next five years time, used for marketing. However, for many in the industry question, raul scoffed. In the eyes of raul, Jet completely have the ability to challenge amazon website.

 

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