You’ve heard of building a better mousetrap, but what about a better mousetrap store? Marc Lore, the guy who sold Diapers.com to Amazon for $550 million, is betting that his new startup can do e-commerce better than his former buyer, the guys who perfected quality goods at low prices that you forgot you ordered while you were drunk.
Jet.com, currently in private beta, will charge members $50 a year to access the lowest prices possible on a vast range of goods, with additional discount opportunities for buying items in larger quantities, purchasing multiple items from the same retailer, or waiving the right to return certain items — plus free shipping for orders over $35 and free returns. Jet claims that, by offering products that are on average 5-to-6 percent cheaper than anywhere online, they will ultimately save members at least $150 a year.
Of course, somewhere between 30 and 40 million Americans already pay $99 a year for Amazon Prime, where they get free 2-day shipping on more than 20 million items, plus all the streaming video, music, and e-books their data plan can handle. Should Prime members ditch all that in favor of the shiny new Jet?
Here’s an apples-to-apples price comparison of a few choice items you might need, including food, kids’ toys, dad toys, and diapers. Unfortunately, it doesn’t include actual apples, because Jet doesn’t do produce yet.
Honey Nut Cheerios (21.6oz box)
Let’s say you woke up one morning to discover all of the above in a shopping cart after another late night spending spree. You’d be into Amazon for $1,231.29, and only $1194.09 on Jet. That’s an unexciting savings of $37.20 — but Amazon only stays close in this competition because of the baby monitor (which is $45 more on Jet).
Correct for that single savings (since you should buy this baby monitor anyway), and Jet comes out ahead by $82.22. That’s nearly an 8 percent savings over Amazon and puts you well on your way to the $150 annual savings that Jet claims.
So, there you have it: If you’re a Prime member who isn’t watching a ton of Transparent or addicted to 2-day shipping, but is buying a ton of diapers and Cheerios, you might want to consider switching. And maybe quit it with the late night drunken shopping while you’re at it.