By Andrew Greissman
Amazon is one of the biggest names in ecommerce, but they may soon find themselves on the defensive against a new challenger: trending digital marketplace Jet.com. While the company’s platform has not been officially opened, already buzz has grown surrounding the bold marketing and value proposition put forth by the 100 person company, with veteran ecommerce innovator Marc Lore at the helm. Lore’s challenge to Amazon is especially intriguing, considering that he was behind the sale of Diapers.com parent company Quidsi to Amazon for a historically significant $545 million in 2010.
Jet Insider- the first wave of buzz building.
One of the main buzz generators Jet has used in its pre-launch marketing campaign was their Jet insider program. The crux of the promotion revolved around word of mouth referrals, a sound strategy considering that word of mouth has been continuously shown to be one of the most compelling types of marketing. Insiders who joined up received a de facto 6 month free membership to the site, but that was just the beginning of the gambit. As they referred more and more people, insiders jockeyed for ranks which would elevate them to qualify for prizes such as free membership. Reserved for the top ten most vocal are 10K shares in the private company, as well as a role as consultants during the development of the site pre-launch.
The value prop that promises to undercut Amazon.
Buzz is undoubtedly important for a start-up, especially one with pretensions to the throne of ecommerce dominance. Jet’s plan is to gate membership to its site and function in a similar way to brick and mortar discount store Costco, with a $55 dollar fee annually. These fees are planned to be the only source of profit for the business, with the company not intending to take a share of transactions on the site. Through this strategy, as well as a more strategic approach to fulfillment designed to recommend products that are easier to ship together, and therefore cheaper, Jet claims it will be able to significantly undercut Amazon, itself notorious for undercutting competition. The company needs cash on hand to be able to deliver what it promises, and in a recent article on Techcrunch, they have confirmed an additional funding round of $140 million led by Bain Capital. It remains to be seen what the platform will look like when it is opened for its first round of insiders, but as a serious challenge to Amazon, it’s got a lot to live up to.
Andrew Greissman is a digital content manager for WBR Digital. Andrew’s writing background spans genres and formats from poetry and magazine writing to website copy and press releases. When not writing, Andrew enjoys travel, good food and reading books.
Photo Credit: Kenneth Lu
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