Should You Sell on Jet.com?

October 15, 2015
Jannie Cahill
Written By
Jannie Cahill

Last week, Jet announced a major change to its business model with the online retailer abruptly dropping its membership fee.

In a previous post, Profitero’s VP Strategy and Insights Keith Anderson addressed some of the main considerations behind this significant about-turn – one of which was the need for Jet to engage more retailers and brands.

For Jet to take off, merchant and brand support is vital – particularly in light of reports that many retailers (including Macy’s, Walgreens and L’Oreal) had withdrawn from Jet after alleging the site did not have permission to list them.

As founder Marc Lore commented in his “Jet For All” blog: “We will continue to advocate for our brand and retail partners. We’re building tools to help them sell smarter and drive greater volume and better profitability. We will strive to create an elevated shopping experience in which they’ll be proud to take part. Empowering our partners is central to Jet’s mission, and appealing to a wider customer base will enable us to do even more.”

So with the holiday season fast approaching, an urgent question now facing retailers and brands is: Should I sell on Jet or will it damage my brand equity? By choosing not to sell on Jet, will I risk losing sales to competitors who are selling via this new marketplace?

We asked a range of industry experts to share their unique perspective on this hot topic.

Scot Wingo, ChannelAdvisor

“Bloomreach recently put out survey results re-enforcing data that is already out there – that 40-50% of online shoppers are starting their product searches at Amazon. Like Jet, Amazon is a marketplace.  eBay is another marketplace and many more marketplaces are growing right now.  Think of these as aggregation points.  If you have a website out there, usually a small % of traffic is ‘direct’ and the majority of sales and traffic go through one of these aggregation points, because consumers like them.

We believe Jet has a compelling consumer value proposition and you should put your products there as well as any other ‘channel’ that has serious volume.  Yes, even Amazon and eBay (and Google of course). If you don’t, consumers won’t find your products.”

Bill Bishop, Brick Meets Click

“It seems to me that brands would want to sell on Jet.com because it provides a new and somewhat different sales channel where the majority of the purchases will be incremental to their existing business or, at minimum, will be sales that have been retained because otherwise they would have shifted to a more deeply discounted brand.

Jet.com has put together a unique approach to backend fulfilment for online shopping that focuses the attention of customers on taking actions that actually remove costs from the transaction i.e. it’s not about discounting, it’s about driving down costs and then sharing the savings with customers.

Brands face an increasingly complex channel management challenge and Jet.com needs to be viewed and appreciated in that context in order for them to fully leverage the ability of the site to drive incremental growth.”

Francesca Nicasio, Vend

“One good reason to sell on Jet.com is that it gives brands another marketing channel. The site serves as a marketplace where they can gain additional exposure and potentially, more sales. If their competitors are already selling on Jet.com, then brands should strongly consider getting in on the site as well. Otherwise, they risk giving up share to competing brands.

That said, merchants should also look at the potential downsides that come with selling on Jet.com. The site, after all, is made for consumers who are usually looking for the lowest prices, and brands should ask themselves if these are the customers that they’re after.

Additionally, Jet.com can be both a marketplace and a competitor, which means brands could lose sales (and maybe even customers) by selling on the site.

Bottom line is, brands should weigh the advantages and disadvantages of selling on Jet.com. And if they’re already selling on other marketplaces such as Amazon, they should compare how their products are doing in various marketplaces so they can see how Jet.com stacks up, and whether it’s worth it to be present on the site.”

You might also be interested in reading Profitero’s recent Whitepaper: The Jet.com Experiment – Smooth take-off or the start of a bumpy ride?

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