New online shopping site Jet is challenging Amazon.
By Raif Karerat
WASINGTON, DC: Jet, the highly anticipated e-commerce market that is looking to challenge the ubiquity of Amazon Prime, launched on July 21 with Pakistani American comedian Kumail Nanjiani front and center as the face of the fledgling company.
On Tuesday, Jet’s website posted a promotional video that stars Nanjiani, the actor who plays Dinesh on HBO’s “Silicon Valley,” in which he takes jabs at the bulk pricing models of most membership-driven shopping outlets.
“The old economics of saving money meant you had to buy items in bulk. And that’s weird,” Nanjiani says as a huge tub of mayonnaise is pictured on screen. “Because five pounds of mayonnaise is actually a fundamentally ridiculous thing to buy.”
Jet CEO Marc Lore began work on Jet two years ago, after he had sold one of his most successful ventures, Diapers.com, to Amazon in 2010.
Since then, Jet has raised $220 million, all of which was garnered during the past year.
Jet is hoping it can entice cost- conscientious shoppers by providing an online version of brick-and-mortar shopping clubs such as Costco or Sam’s Club.
According to Lore, Jet will be able to offer consistently lower prices than its “prime” competition because all of its profits will stem from collecting annual membership fees of $49.99 rather than from margins on individual purchases. The website will set its prices using special price-minimizing software, including a “smart cart” feature that lowers the total cost of an order as you add more items to a basket.
“We have an assortment that’s vast like Amazon’s, and pricing that’s similar to a wholesale store and membership,” Lore told CNNMoney.
Jet will face significant hurdles as it tries to convert Amazon loyalists into “Jetheads,” a term it hopes will catch on for loyal Jet shoppers, according to the Washington Post, but Lore believes his newest venture will revolutionize online shopping in the long term.
Speaking to the New Yorker, Lore is confident Jet will be able to move $20 billion’s worth of products annually by 2020, a lofty goal, but one his slew of investors are banking on.