Selling on Jet.com in 2019: Understanding If Your Business Should Leverage This Online Marketplace Option
Jet.com is an online marketplace that sells just about everything — from household items, to groceries, to electronics, to Legos… you name it.
Jet.com strives to offer the lowest prices available, and the ecommerce strategy behind that is clear. They wish to minimize or eliminate embedded costs completely. When a product is sold in-person, there are a lot of factors that could make the prices increase. Eliminating and minimizing these costs via an online marketplace is what makes Jet.com cheaper.
Additionally, the combination of bulk-buying discounts and smart cart shipping has hooked the US’s price-sensitive shoppers.
In this piece, we’ll dive into what makes the Jet.com marketplace an ideal way to reach your customers. We’ll also walk you through the exact steps you need to take to set up your account and start selling your products.
Unlike Amazon, Jet’s business model favors low price over fast delivery. Orders over $35 are entitled to free standard shipping, and two-day delivery is an additional cost.
Jet.com serves both the customers and the sellers: Customers who want higher discounts are drawn to the platform, while sellers have the ability to see and connect with frequent customers who are near them.
“While discussing his keen insights from his time at Diapers.com (acquired by Amazon in 2010), March Lore spoke about how he was able to address a niche — people looking for higher savings. While answering a question on the popular Q/A website Quora, he said, “It won’t be a winner-takes-all situation by any stretch — there will be more than enough room for multiple players and this gives space to many companies to grow, and one company which is poised to gain maximum from this traction is Jet.com”
As depicted in the picture below, grocery, Home and Kitchen and Health and Wellness are the categories where Jet.com outperforms Amazon.
Source: Slice Intelligence
Offering prices at 5-15% less than competitors has made the Jet.com marketplace immensely popular. Currently 400,000+ members are joining the platform every month and over 12 million products are listed on it.
Jet.com introduces an innovative way of shopping: the more items that are added to a customer’s cart, the lower the cost of the items is.
For example, after adding a coffee table to your cart, you may be shown additional household items to purchase at a significantly lower cost than they were originally listed.
Paired with low-cost shipping, this strategy helped to strengthen Jet.com’s CPG value per order. It is now larger than other marketplaces, as shown in the image below.
Source: Slice Intelligence
Jet.com’s Strategies For Lowering Product Costs
1. Real-time pricing engine results in bigger baskets.
Jet.com’s dynamic real-time pricing engine comes quickly into play once customers start shopping and after the product is added, the discounts are applied. This strategy helps optimize order management, and inventory management. Additionally, once consumers start adding products to their cart, Jet.com starts searching for vendors that are closest to the consumers to help fulfill the order. By incentivising customers to build bigger baskets, Jet.com’s logistics fee is reduced, the order can be placed in a single box, and distribution centers are centralized.
2. A waived return fee captures hesitant shoppers.
Products on Jet.com come with free returns, as long as the order total is over $49. This helps convert customers by guaranteeing that if they don’t like their purchase, they can send it back.
Image Source: Jet.com
Additionally, Jet.com offers incentives for customers to opt-out of free returns. If the customer does the math, this might end up saving them money.
3. Email opt-in rule.
Jet.com offers shoppers a discount when they opt-in to the mailing list. This is presented to shoppers during checkout as a one-time discount in order for them to give their email address.
4. Low fee payment methods.
Members can use exclusive payment methods to access bonus savings — i.e. use of payment methods that are less taxed than others, such as debit card over credit card.
How Do Sellers Benefit From Listing on Jet.com?
Since the marketplace is still in its early days, Jet.com has fewer brands than Amazon. In addition, buyers only discover the name of the seller they’re purchasing from during the checkout process.
Therefore, it offers every seller an equal opportunity. And the dynamic search engine on the website helps customers get exactly the product that the need.
Below, find some benefits for sellers who choose to put their products on the Jet.com marketplace.
1. The pay-as-you-go model.
Jet.com doesn’t charge any sign-up fee, monthly fee or product listing fee and the only fee that is charged is a 8-15% commission on the product purchase. The commission differs depending on the product type.
2. Choose minimum order quantity.
The seller decides the minimum number of products for a basket. It is easy to set a minimum amount of products that must be ordered.
3. Choose areas to sell/ship to.
Sellers can set savings to the minimum if the order is sent across the country, where shipping costs maximize so a customer is less incentivized, therefore discouraging an order.
4. Higher cart value.
Jet.com has a higher cart value than Amazon — i.e. buyers add more items to their Amazon cart, compared to Jet.com. The Average Cart Value of Jet and Amazon is 1.5 & 1.1, respectively.
5. Email marketing.
Merchants can create a direct relationship with customers as they provide one-time discount offers to consumers for providing their email addresses at time of check out. It can be used for future correspondence and promotions.
6. Integration with BigCommerce.
There’s no need to move your store directly over — you can still sell to Jet.com off your BigCommerce account. Just connect your store and facilitate bi-directional catalog data transfer, order acceptance and fulfillment from BigCommerce itself.
Cons of Selling on Jet.com
There is one most common complaint we receive from our customers, “Change in their catalog content”.
What Jet.com does is it applies the best converting content to your item’s content as well. There is nothing fishy in this exercise unless a product is a little different than the product whose content (in principle) has been used to describe your product.
In addition, there are several other factors that some merchants do not like about the Jet.com marketplace.
1. Strict approval process.
Jet.com only wants the highest quality goods from the highest quality sellers.
2. Continental US only.
Jet only ships to the 48 states. That means no Hawaii, Alaska, Europe, Asia or anywhere that isn’t the good ol’ (mainland) USA.
3. Only branded products.
Also, mentioned above, you can only sell branded private label products.
4. Long review process.
Since Jet utilizes a Unified Product Catalog, as a result, Jet’s catalog team carefully reviews each SKU on the backend. They ensure that it’s either connected to a pre-existing listing or listed as a completely new listing. Hence overwhelming number of SKUs in Jet’s review process, can sometimes take a lot of time to get live at Jet.com. It can take anywhere from 4 to 6 weeks.
Prerequisites of Selling on Jet.com
Jet.com prefers sellers and brands who are category specialists, offer quality products, and can deliver excellent post-sales service. Therefore, it’s only for established ecommerce businesses.
Seller qualifications to list products at Jet.com are listed below.
- Functional Bank account
- Valid U.S. Business Tax ID Number (for sole proprietor – valid U.S. SSN number)
- Sell Branded products (and leave Prohibited Products)
- Uphold Jet.com’s ‘Excellent Fulfillment & Delivery Performance’ standard
Fees of selling on Jet.com
Jet.com — better described as an online version of Costco — abolished its membership fees early into its operations. Now, there is more potential to reach new customers. Also, orders with a value greater than $35 are shipped free.
1. No fees for sign-up.
Jet.com doesn’t charge any sign up fees, unlike other marketplaces.
2. No monthly subscription fees.
There are no fees for staying on Jet.com, regardless of the basis you use it.
3. No listing fees.
Jet.com stands out way above the rest in the fact that there are no listing fees.
4. Only pay commission fees.
The only fees that you’ll pay when you sell an item on Jet.com are the commissions off of your products. There are different percentages per item type that you sell, but it still maintains a reasonable rate.
Steps to Sell on Jet.com
1. Completing the application process
First and foremost, since Jet.com is an invitation only marketplace, therefore, before listing your items on Jet.com, you first need to be approved as a Jet retail partner. Get a Jet partner account via submitting information with this link.
It takes, in general, 2-3 weeks to review your products and get approved. However, the larger the catalog, the higher the preference. You may contact partner@jet.com to get the status of your application & other information.
2. Choosing the integration partner
Since Jet doesn’t offer a seller dashboard in a traditional partner portal to sell and list your products manually, you will need to decide on your preferred multichannel integration partner. After you application to sell on Jet.com is approved, you’re provided a set of Jet API keys to connect your store with Jet.com and thereafter initiate the catalog transfer process.
3. Connecting BigCommerce store with Jet Marketplace
Now you’re ready to begin the 3P integration party app/extension installation and configuration process. A word of caution, “Jet.com curates the data from different sellers to show the best available combination for any product; which means for your items, the description can come from some other retailer and title from some other”
An overview of catalog transfer process | Image source:Jet.com
How To Create A Great Product Listing At Jet.com
Sell the sizzle, not the steak. It’s a phrase that goes hand-in-hand when selling on Jet.com. They not only want you to sell a great product, but expect you to offer even better post-sales service. Therefore, if you want your products to appear amongst top searches in the Jet product search, you’ll need to adhere to Jet.com’s best practices.. They are as following
1.Provide SKU data.
To distinguish among millions of listings, Jet.com requires you to provide SKU information. This data not only makes your listings stand out but most importantly it is essential for your products to go live at Jet.com.
The more information you provide, the better the listing quality. Though there are optional fields as well, which merchants generally skips to fill. However, we advise you to provide all the information required. As the motto here is not to just make your listings available at Jet.com but have an impact as well. The required & optional data fields are:
- Merchant SKU: The unique identifier to identify the product
- Unique IDs: At least one, however multiple unique identifiers are preferred if the item is not merchant specific such as ISBN, UPC, EAN, ASIN, GTIN etc.
- Product Title: The short description of the product (≤ 500 characters).
- Multi-Pack Quantity: If a single unit of an item contains multiple products inside it. Then the combine merchants SKU for that product.
- Item Price: The price of the item which you want to display on Jet
- Inventory: The exact amount of units for a time period and for a particular warehouse.
2. Choose the appropriate category.
What would you do if a shoe came up in your search for a camera. Would you buy it? The answer is no. Therefore, it is absolutely necessary that your products appear in the right places.
Jet has several taxonomy levels in the form of categories and subcategories.
Correct category mapping ensures that you eliminate all the possibilities of not getting orders due to your products not appearing at right places
3. Appropriate attribute for variations.
The importance of attribute mapping second to none. Customers that are in the consideration stage may use more keywords in their search such as blue nike shoes, or short sleeve polo shirt.
This is where mapping attributes of products such as color, size, material etc. with the item is crucial. Jet.com provides a set of attributes for different product types. There are 2 benefits of doing correct attribute mapping:
- Different units of a product are differentiated for example a shirt with different sizes or colors.
- It helps during the result display when customers perform a keyword search.
4. One image says a thousand words.
Images are the make and break factor for any product. A product image that includes various angles of the product and a marketing styled image hold higher affinity for a product to get sold.
Image Source: Jet.com
Increasing the chances of your products getting sold by delivering quality product images. These are the guidelines by Jet for images to be used:
- Image source must be a valid URL.
- 1500 x 1500 pixels or larger is preferred, 500 x 500 pixels or larger is accepted.
- Images should not include any retailer specific marketing language, such as “Customer Favorited” or “Featured Product”.
- Remove all ‘No Image Available’ images.
- Accepted image formats include: image/x-xbitmap, image/x-ms-bmp, image/bmp, image/jpeg, image/jpg, image/pjpeg, image/tiff, image/gif, image/png 7.
Avoid watermarking your images. Also, stay away from unnecessary branding, Jet.com highly discourages the practice of putting watermarks on the images.
5. Product title.
The product’s title should be between 50 to 500 characters. Brand name should be at the beginning of the title.
In addition, avoid using any special characters that are not the part of manufacturer title, remove attributes (colors, sizes etc), and remove any marketing jargon related to pricing or shipment or retailer or sales specific information.
6. Product description.
The product description of the item must be holistic. It should cover all the areas of concern such as its usage, occasions where it can be used (for apparels and shoes), its applications and more. This can be achieved by inserting keywords or generic terms that identify the product and its features. Here are some general guidelines for creating product descriptions:
- Remove any shipment or fulfillment related information
- Avoid marketing jargon like “customer favorite,” “best seller,”, “free shipping,” etc.
- Avoid mentioning any pricing or special deal related information
Image source:Jet.com
The above image contains information about Neutrogena Skin Cream. You can see how the related or LSI keywords have been sprinkled strategically throughout the product description not only to describe, but also to increase the product descriptions’ search engine friendliness.
Note: Latent Semantic Indexing (LSI) keywords are the terms and phrases which have a high degree of correlation with the targeted keyword and the search engine uses these terms to judge the quality of content as it expects them to appear alongside the targeted keyword. For example: Google prefers a page, targeted for ‘best tacos’, containing phrases such as “salsa,” “guacamole,” and “handmade tortillas” over a page which simply has best tacos repeated.
7. Great fulfillment record.
Jet.com allows merchants to fulfill the orders from their warehouse or, have them shipped via a dropshipper. However, everything explained above will fall flat if Jet’s fulfillment standards are met.
Image Source: Jet.com
In addition to the aforementioned metrics there are several other guidelines which must be adhered to:
Image Source: Jet.com
Among all of the metrics, ODR matters the most, sellers are expected to keep ODR (Order Defect Rate to 2% or lower). Order Defect Rate is defined as the ratio of orders with any defect to the total orders.
How Does Commission Work on Jet.com?
To calculate your commission right you need to take the Base Commission Rate on the item category and apply any Commission Rate Adjustments made in the Jet Rules Engine which are explained in the following part.
Image Source: Jet.com
Note: The most intriguing fact is that a part of the commission is passed on to customers as Jet member savings.
How To Sell More Effectively on Jet.com
First and foremost, price competitively and stock complimentary products that are frequently bought together. Thereafter, try sharing savings from shipping with your customers. Its core philosophy relies on awarding orders to sellers nearest to the customers.
Hence not only will this help you get more orders, but also help you deliver faster. This section will explain how can you leverage the Jet rules engine to maximize your profit:
Jet engine rules are based fundamentally on increasing competitiveness on profitable orders or compelling shoppers to take actions that increase your profitability.
- Shipping Distance Rule
- Basket Building Rule
- Waive Returns Rule
- Email Opt-in rules
1. Shipping rule.
The first way that you can win more orders from Jet.com is by applying Shipping Rule.
Consider the image.
Let’s assume you sell cameras. A is a competitor offering the same camera you sell, B is you, and C is the customer who is looking for the camera.
Both (You and A) offer the camera at $100 (Item price + Shipping Price). Jet.com takes 15% commission. So the money received by you would be $85.
Now here is the catch. Since Seller A is far away from the buyer C in comparison to where you’re based, he has to spend more on the shipping. However, you’re able to ship the same item for a lower cost, so you can take the benefit of the distance optimization.
How?
You can offer an extra discount to the Buyer C. However if you offer an extra discount, your margins are diminished. So what do you do? Here is the strategy. Jet.com permits you to increase the item price and then offer an additional discount.
|
Price
|
Item Price
|
Shipping Charges
|
|
$100
|
$90
|
$10
|
Increase the item price by $2 for a total of $92.
The total cost due to you is now $102. Now offer an extra 2% discount. The new chargeable commission would be 17% (including previous 15%).
However, after the discount, the offered price would be $84.66 which is lower than the cost of the camera from Seller A. Additionally you don’t have to compromise on your Shipping savings.
Not only do you win the order, but you make additional savings well.
How to do this in the Jet Partner Panel
First, Login to the Partner Panel, then click ‘Rules Engine’, then choose shipping distance.
The entire United States is divided into 8 zones.
Here you can choose the zones where you can effectively ship your products and can aggressively offer commission adjustments and the zones where you don’t want to ship your products and won’t offer any commission adjustments.
“A merchant can determine the average retailer price by category by adding the retail price with average shipping costs by zone for that category as defined by FedEx or UPS. Further to calculate commission adjustments (zone-wise) simply by subtract the zone’s average shipping cost from the overall average shipping cost and divide this by the retailer price.”
2. Building bigger baskets.
Another way that Jet.com incentivizes users is by offering greater savings when they buy multiples of the same product or build bigger baskets.
To achieve this, you can either create customized order size based on dollar value or decide the minimum number of units added to a cart for commission adjustment range to be applicable.
How to do this in the Jet Partner Panel
First, Login to the Partner Panel, then click ‘Rules Engine’, then choose Basket Building.
Here you can enter the Commission Adjustments per unit purchased depending on the Order value.
Now, let’s suppose A and B are the two sellers and you’re B.
A customer builds a basket with order value worth $150. Let’s say, A offers 2% Commission adjustment along with the 15% Jet.com’s commission. So the total commission stands out at 17%. Therefore the price offered by him would be $124.5.
Now what you can do is raise the Item price and simultaneously increase the Commission Adjustment.
So, now what you can do is price products such that the total item price is 154 and offer 6% Commission Adjustment, therefore the price offered by you is $121.66. You’ve now beat out your competitor’s price.
3. Waive returns.
You can also incentivize users by waiving off the return fee.
How to do this in the Jet Partner Panel
Login to the Partner Panel, click ‘Rules Engine’, then choose Waive Returns.
Now choose the product category and use the calculator to deduce the percentage Commission Adjustments.
Here the areas are:
- Average product cost (Suppose $50)
- Return Rate (Assume (5%)
- Return Shipping Cost ( Assume $10)
- Restocking cost (Assume $5)
- Percent returned that are lost or unsellable (5%)
Therefore, the Commission Adjustment would be 1.75%. So the consumers can get the corresponding discounts in dollars.
4. Email opt-in rule.
This is the one time discount that you can trade (in dollars) with the customers in exchange for their email addresses for the purposes of direct marketing.
The above four strategies can help you compete aggressively and win maximum orders.
Conclusion
Jet’s totally revolutionary algorithm targets items with discounts available, based on the seller’s location and the shipping cost. The more items a merchant buy, the greater he saves. That’s driving larger baskets and giving Jet customers a good reason to return. Jet’s repeat buyer rate is 23%, which is way better than both eBay (17%) and Amazon (11%).
Thus, Jet.com is proving to be a great alternate sales channel for sellers as it focuses on benefiting both their customers and sellers alike whereas other marketplaces’ primary focus has always been customers so much so to the detriment of sellers. Innovations like Jet rule engines enable merchants to take control of their stock, profitability, and hence — their fate.
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