By Sarah Halzack
The July launch of Jet.com was perhaps the most highly-anticipated debut on the retail scene this year. The new e-commerce site, founded by Diapers.com veteran Marc Lore, is among the most well-funded start-ups in history and has a real-time pricing model that is unlike that of any other retailer.
A little more than a month after Jet began selling to the masses, software provider ChannelAdvisor has released data that offers some clues about what kind of traction the retailer has gotten so far.
“Their momentum out the gate is strong,” said David Spitz, ChannelAdvisor’s chief executive.
ChannelAdvisor studied the transactions that took place since July on its software platform, which is used by many retailers and brands to facilitate selling on online marketplaces including Amazon, eBay and Jet. ChannelAdvisor’s analysis found that, in its first month of selling, Jet already surpassed marketplaces such as Sears, Best Buy, Newegg and Rakuten, in terms of “gross merchandise value,” industry-speak for the total value of products sold. (Keep in mind this is just an analysis of merchandise sold in a third-party marketplace format, so, in the case of Sears and Best Buy, it does not include items purchased on those sites that are fulfilled directly by Sears or Best Buy.)
ChannelAdvisor also found that Jet is having early success in building customer loyalty: Since its debut, Jet has had a 23 percent repeat buyer rate, better than the 17 percent seen at eBay and the 11 percent seen at Amazon during the same time period.
But Jet’s success doesn’t just depend on its ability to convince customers to pay its $50 annual membership and to shop the site regularly. Crucial to Jet’s future is whether it is able to keep growing the roster of merchants that sell on its marketplace. Without a huge network of sellers, the site will never have the wide selection of its rival, Amazon. Here, too, ChannelAdvisor’s findings are encouraging news for Jet: The average gross merchandise volume of a Jet seller since launch was double that of a seller on Sears or Newegg. Spitz said that kind of data point might make the case to merchants that it is a smart business move to play ball with Jet.
ChannelAdvisor said it doesn’t see any evidence that Jet is stealing business away from Amazon or eBay. For example, customers who purchased from Jet as well as from either Amazon or eBay did not slow down their purchase rate at the more established sites once Jet came on the scene. But it’s difficult to say whether this is bad news for Jet. On one hand, it might suggest that Jet is not convincing the online shopping faithful to give their site a try. And yet, Lore has long insisted that poaching Amazon Prime customers was never essential to his model. Lore has said that he believes that Amazon’s $99 Prime membership inherently appeals to a different shopper than Jet does, because Prime buys you access to speed, while Jet theoretically buys you access to lower prices. So, if Lore’s right, it may not be such a big deal that shoppers aren’t trading Amazon for Jet.
“This seems to be early evidence that there is a segment of customers that hasn’t been well-addressed by the existing marketplaces,” Spitz said.
ChannelAdvisor’s analysis only includes transactions with sellers who use its software, so it does not include orders that are filled directly by Jet or by third-party sellers who don’t use ChannelAdvisor. So it is not a complete view of how Jet compares with its rivals.
Still, the data help illuminate what kind of start Jet has had as it has entered the retail fray. There were early signs that Jet may have gotten off on the wrong foot with some established retailers, an inauspicious development for a company that hopes to get big-name brands to sell on its marketplace. Many were irked by the Jet Anywhere program, which gives customers rewards they can use on Jet when they shop at, say, Anthropologie or Nike. Dozens asked that they be removed from the list of brands that earn a shopper Jet Anywhere rewards.
Washington Post
By Sarah Halzack
The July launch of Jet.com was perhaps the most highly-anticipated debut on the retail scene this year. The new e-commerce site, founded by Diapers.com veteran Marc Lore, is among the most well-funded start-ups in history and has a real-time pricing model that is unlike that of any other retailer.
A little more than a month after Jet began selling to the masses, software provider ChannelAdvisor has released data that offers some clues about what kind of traction the retailer has gotten so far.
“Their momentum out the gate is strong,” said David Spitz, ChannelAdvisor’s chief executive.
ChannelAdvisor studied the transactions that took place since July on its software platform, which is used by many retailers and brands to facilitate selling on online marketplaces including Amazon, eBay and Jet. ChannelAdvisor’s analysis found that, in its first month of selling, Jet already surpassed marketplaces such as Sears, Best Buy, Newegg and Rakuten, in terms of “gross merchandise value,” industry-speak for the total value of products sold. (Keep in mind this is just an analysis of merchandise sold in a third-party marketplace format, so, in the case of Sears and Best Buy, it does not include items purchased on those sites that are fulfilled directly by Sears or Best Buy.)
ChannelAdvisor also found that Jet is having early success in building customer loyalty: Since its debut, Jet has had a 23 percent repeat buyer rate, better than the 17 percent seen at eBay and the 11 percent seen at Amazon during the same time period.
But Jet’s success doesn’t just depend on its ability to convince customers to pay its $50 annual membership and to shop the site regularly. Crucial to Jet’s future is whether it is able to keep growing the roster of merchants that sell on its marketplace. Without a huge network of sellers, the site will never have the wide selection of its rival, Amazon. Here, too, ChannelAdvisor’s findings are encouraging news for Jet: The average gross merchandise volume of a Jet seller since launch was double that of a seller on Sears or Newegg. Spitz said that kind of data point might make the case to merchants that it is a smart business move to play ball with Jet.
ChannelAdvisor said it doesn’t see any evidence that Jet is stealing business away from Amazon or eBay. For example, customers who purchased from Jet as well as from either Amazon or eBay did not slow down their purchase rate at the more established sites once Jet came on the scene. But it’s difficult to say whether this is bad news for Jet. On one hand, it might suggest that Jet is not convincing the online shopping faithful to give their site a try. And yet, Lore has long insisted that poaching Amazon Prime customers was never essential to his model. Lore has said that he believes that Amazon’s $99 Prime membership inherently appeals to a different shopper than Jet does, because Prime buys you access to speed, while Jet theoretically buys you access to lower prices. So, if Lore’s right, it may not be such a big deal that shoppers aren’t trading Amazon for Jet.
“This seems to be early evidence that there is a segment of customers that hasn’t been well-addressed by the existing marketplaces,” Spitz said.
ChannelAdvisor’s analysis only includes transactions with sellers who use its software, so it does not include orders that are filled directly by Jet or by third-party sellers who don’t use ChannelAdvisor. So it is not a complete view of how Jet compares with its rivals.
Still, the data help illuminate what kind of start Jet has had as it has entered the retail fray. There were early signs that Jet may have gotten off on the wrong foot with some established retailers, an inauspicious development for a company that hopes to get big-name brands to sell on its marketplace. Many were irked by the Jet Anywhere program, which gives customers rewards they can use on Jet when they shop at, say, Anthropologie or Nike. Dozens asked that they be removed from the list of brands that earn a shopper Jet Anywhere rewards.
Washington Post
