Jet.com

Definition

Jet.com is an e-commerce company that was founded in 2014 with the goal of challenging Amazon's dominance in the online retail market. It operates an e-commerce platform that offers a wide range of products, from household goods to electronics, with a focus on providing customers with low prices and a seamless shopping experience.

5 Must Know Facts For Your Next Test

1. Jet.com was founded by Marc Lore, who previously co-founded Diapers.com and Quidsi, which were acquired by Amazon in 2010.
2. Jet.com's pricing model is based on a dynamic pricing algorithm that adjusts prices in real-time to offer customers the lowest possible prices.
3. The company's business model relies on offering a wide range of products at low prices, with the goal of generating revenue through high-volume sales rather than high profit margins.
4. Jet.com was acquired by Walmart in 2016 for $3.3 billion, as part of Walmart's strategy to compete more effectively with Amazon in the e-commerce market.
5. After the acquisition, Jet.com continued to operate as a separate brand, with the goal of reaching a younger, more urban customer base than Walmart's traditional customer base.

Review Questions

• Explain how Jet.com's pricing algorithm works and how it relates to e-commerce trends.
  • Jet.com's pricing algorithm is a key feature of its business model, as it allows the company to dynamically adjust prices in real-time based on factors such as supply, demand, and competitor pricing. This pricing strategy is a reflection of the broader trend in e-commerce towards more sophisticated and data-driven pricing models, which aim to offer customers the lowest possible prices while still maintaining profitability. By using a pricing algorithm, Jet.com is able to respond quickly to changes in the market and offer customers a more competitive shopping experience compared to traditional brick-and-mortar retailers or other e-commerce platforms.
• Describe how Jet.com's acquisition by Walmart fits into the broader trends in e-commerce, particularly the competition between traditional retailers and online-only platforms.
  • Jet.com's acquisition by Walmart is a prime example of the ongoing competition between traditional retailers and online-only platforms in the e-commerce space. As more and more consumers shift their shopping habits towards online platforms, traditional retailers like Walmart have had to adapt their strategies to remain competitive. By acquiring Jet.com, Walmart was able to leverage the company's expertise in e-commerce and its younger, more urban customer base to strengthen its own online presence and better compete with industry leaders like Amazon. This acquisition highlights the broader trend of traditional retailers investing in or acquiring e-commerce companies as a way to stay relevant and maintain their market share in the rapidly evolving e-commerce landscape.
• Analyze how Jet.com's business model and strategies have evolved since its acquisition by Walmart, and how these changes reflect the broader trends and challenges in the e-commerce industry.
  • Since its acquisition by Walmart, Jet.com has had to navigate the challenges of operating as a separate brand within a larger, traditional retail organization. While Jet.com was initially positioned as a disruptor in the e-commerce space, its strategies and business model have had to adapt to the realities of being part of a larger, more established company. This evolution reflects the broader trends in the e-commerce industry, where successful online platforms must balance innovation and agility with the resources and scale of traditional retailers. Jet.com's continued focus on pricing algorithms, data-driven decision making, and reaching a younger, more urban customer base demonstrates the importance of these strategies in the highly competitive e-commerce landscape, where companies must constantly adapt to changing consumer preferences and market conditions.

Related terms

E-commerce:

The buying and selling of goods or services over the internet.

Online Retail: The sale of products or services through the internet, typically through a website or mobile application.

Pricing Algorithm: A set of rules or procedures used by e-commerce platforms to dynamically adjust prices based on various factors, such as supply, demand, and competitor pricing.