The recent acquisition of home goods seller Hayneedle by disruptive marketplace startup Jet.com was a good fit that came along at the right time, not the result of an active pursuit of a target in that category, a Jet.com executive said.
“We’ve known of Hayneedle and been involved in conversations in the past in terms of sharing what Jet.com is all about,” said Scott Hilton, the company’s chief revenue officer. “The opportunity emerged fairly recently and we jumped on it. As we look at their business, it creates an incredible chance to leverage Hayneedle’s deep merchandise expertise and their know-how in shipping and delivering heavy items. That’s something that would take us a long time to pick up on our own.”
In addition, the acquisition nearly triples Jet.com’s home goods offerings, from 800,000 to 2.3 million unique items. Terms of the deal were not disclosed.
As for Jet.com in general, Hilton said the company has 1,500 merchants and 10 million items live on its platform seven months after its launch, and the first quarter is expected to beat a very successful fourth quarter which saw lots of holiday traffic. The company was selling close to $2 million in merchandise daily during the holiday season, and nearly 3 million customers used Jet.com in the second half of 2015.
Jet.com sells an estimated $500 million worth of goods a year, while Hayneedle pulls in about $350 million in sales.
Hilton said Jet.com customers are getting used to the concept of loading up online shopping carts and making selections that reduce the overall cost of the order, such as opting for slower delivery times.
“From the beginning, customers have been building bigger baskets,” he said. “We’re also definitely seeing an increase in repeat customers. There’s a gamification aspect to it, knowing that the choices you make affect pricing, and it becomes addicting. It’s still early days, and we know as we do more research and better understand consumer behavior, we’ll be able to get better and better at helping buyers pull costs out of the system, to their benefit as well as our retail partners, which is the whole intent of the Jet.com platform.”