The online shopping company released a beta site for select customers in the spring but is now available to everyone. To promote their launch, Jet is offering a free, three-month trial, "no strings attached."
Jet offers club pricing on over 4.5 million products. For an annual $50 fee, Jet promises to deliver prices lower than its competitors and even lists Amazon’s prices beside its own for comparison.
Additionally, Jet uses “smart” pricing to reduce costs. That is, if you add an item to your cart that’s similar to one you’ve already selected, you’ll receive extra savings. For example, if you have one kitchen appliance in your cart and you add another, different appliance you’ll see smart savings applied.
Interestingly, despite the membership fee, Jet says it is not trying to compete with Amazon Prime. According to Marc Lore, creator of Jet, the perks of Amazon Prime make it a “completely different animal.” Jet may be closer to a wholly eCommerce version of Costco, except that you don’t have to buy your mayonnaise in bulk.
Despite rumors that the company will reach a $3 billion valuation by the end of the year, the beta site wasn’t a huge success. The Wall Street Journal indicates that the company’s prices were too low to turn a profit. Plus, because they haven’t partnered with enough merchants or snagged enough warehouse space, when customers purchased products Jet didn’t have in stock, a Jet employee would purchase the product on another site and have it shipped directly to the customer. For now, Jet is essentially eating the additional costs for this until the company takes off.
While the potential savings may lure some customers away from Amazon, Amazon’s familiarity and ease may be enough to keep most customers firmly in its camp. However, conscientious shoppers looking for an alternative to Amazon for reasons less to do with price and more to do with ethics may turn an eye toward the hopeful competitor.
For now, we're left wondering if there's enough space in the eCommerce world for another giant.