Inc.com Interview with Alice.com Founders — Business Model Explained

July 5, 2009 · 3 comments

June’s Inc. has a great interview (available online here) with the co-founders of Alice.com, Brian Wiegand and Mark McGuire. In it, they talk about their business model, which has some similarities to what they did with Jellyfish, but is also very different.
Alice.com wants to get the attention of consumers by offering “consumer packaged goods” (consumable products including food, cleaning products, and cosmetics) at Walmart/Target prices with free shipping. Shipping cost has traditionally been a barrier to buying these types of items online. In addition, the site has “taken all the coupons in the entire country and uploaded them,” so the savings is built in and no clipping is required. For those of us who are coupon-challenged, lacking the time or patience to clip and organize, much less remember to bring them when you shop, this is a very nice perk.
Alice.com is also getting the attention of its product suppliers, by offering them a platform to sell their merchandise outside of stores, where shelf space is at a premium as more and more supermarkets fill the shelves with their own store brands of products. Alice currently has signed up half of the top 10 “cpg” manufacturers and until the others sign up, which they expect to happen within the year, they are wholesaling the remainder of their products. They keep all of their products in one centralized warehouse (wow, I’d love to see what that looks like!) and they ship everything out in one box from there.
So where does Alice make its money? This is where the Jellyfish similarity is: they charge manufacturers for placement in their search results. If you want your product to come up first when an Alice.com customer searches for, say, toothpaste…you’ll pay for the placement.
I can’t understand how that could generate enough profit to cover the overhead that must be involved in an undertaking like this, but this is Brian and Mark’s fourth internet business and the previous three sold for milions of dollars each, so they must know what they’re doing.
I placed my second order on Alice.com last Wednesday and it’s scheduled for delivery on Monday (the holiday delayed it a little). I only bought products that were at or below what I would spend for them at Walmart, and I got 25% off that using their eCoupons. Am happy so far with my Alice.com experience.
You’ll get $10 off when you spend $50 at Alice.com after joining with the referral link of an existing member. If you want to try them out, please use my link — thanks!

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{ 3 comments… read them below or add one }

Alice.com Fan! July 18, 2009 at 4:21 am

Hi Becky,
Is Alice great or what?
I joined a few weeks ago with your referral link. Then did my regular shopping at the store because I didn’t have “have time” to look through the listings and comparison shop. Boy, what a mistake that was! I can see that if I’d ordered through Alice instead of clipping coupons, buying from the store and then filling out online rebates, I’d have saved even more in both time and money.
As luck would have it, I missed a couple of things on my shopping trip. (My husband is one of those who will use something up but will forget and leave the box in the same place, so I don’t realize it’s empty. Aren’t husbands great like that? LOL) So I thought I’d check out Alice. But I didn’t think they’d have some of the odds and ends that I needed like envelopes. Guess what? They did! And at a smokin’ price! Check out how much I saved:
Price Coupon Total
Nature Valley Roasted Nut Crunch Bars $3.59 $1.05 $2.54
CoverGirl Smudgeproof Mascara $4.65 $1.00 $3.65
Cascade Dishwasher Detergent $3.22 $1.00 $2.22
Swiffer Furniture Spray $3.89 $1.00 $2.89
Freeman Lotion $3.19 $3.19
TRESemme $4.29 $4.29
Dove Conditioner $4.22 $1.00 $3.22
Johnson & Johnson Dental Floss $1.27 (3) $3.81
Bic Razors $3.86 $3.86
50 Mead White Envelopes $0.85 $0.85
—– —-
No-Clip Coupons = $5.05 Total (w/tax)$33.34
The prices without coupons at Alice are comparable and in most cases lower than those at the stores where we live. That’s with coupons available here right now too.
Now figure in the time I saved:
About 2 hours searching for the best deals online and through circulars, printing coupons online, clipping coupons and then organizing them.
Another hour driving to different stores through traffic to get all the deals.
Speaking of driving… Our car gets very good mileage, so we’ll say the cost of a gallon of gas.
So when you add together all of those convenience factors with money saved by shopping at Alice from my neck of the woods, I have to say I saved a lot! :)
I’ll let you know when my order arrives, the condition it was in when it showed up and all that good stuff.
I do a lot of Amazon.com’ing and ebaying but I’m thinking this one’s gonna have ‘em beat by a mile. (Except in the free gift card department. Most of my rewards programs pay in amazon cards.) Now if only someone *cough*Becky*cough* could hook them up with Ebates. That’d be magic! (Getting rewards sites to offer Alice gift cards would be great too!)

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Alice.com Fan! July 20, 2009 at 8:09 pm

Got my shipping notice today, woohoo!

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Alice.com Fan! July 24, 2009 at 9:58 pm

The shipping notice was sent on 7/20 and I got my order today. :) Four days, just like they said it would be, woohoo!
The order was complete, undamaged and came in planet-friendly, recycled packaging. Not too much packaging either. I hate when there’s too much, lol.
Alice really is a great service and a great deal. Fast delivery, friendly, great coupon prices and earth-friendly packaging. What’s not to like? Nothing, that’s what!

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