Dive Brief:
- Jet, the e-commerce membership marketplace set to take on Amazon Prime, will dedicate ad revenues to keeping prices merchandise low, founder and CEO Mark Lore said.
- Jet charges a $50 membership fee to access discounts on a range of merchandise from groceries to gadgets, promising to undercut Amazon’s prices.
- The site will launch a $100 million campaign in September with multiple television placements and digital banner ads.
Dive Insight:
Lore said that as traffic ramps up at the marketplace site, any ad revenues it generates will be dedicated to keeping merchandise prices low, according to an Adweek Q&A.
After paying a $50 membership fee, Jet shoppers can access a wide range of goods at about 15% off retail prices; Jet further discounts orders based on selected payment options, shipping efficiency, and a unique return waiver. The site could offer an added discount to customers who opt to view banner ads, Lore said.
Built around a dynamic pricing engine that finds the most efficient and inexpensive way to deliver goods, Jet’s business model dictates that it must reach $20 billion in gross revenues by 2020 to realize a profit.