We just flipped the switch on Alice.com, opening up our new service to the outside world. It is a fantastic feeling to bring a new company to life, and we are lucky to have an amazingly talented team that has worked really hard to make Alice happen in a short amount of time. It is great to be a part of it.
The Big Question
Brian and I left Microsoft just over a year ago after they acquired our last start-up Jellyfish.com (news here). At the time, we set out to answer one question: “Why doesn’t anyone buy toilet paper online?” It sounds kind of silly—it did to me anyway—but that question was a metaphor for the larger challenge we wanted to tackle. Namely, could we figure out a way to get the mainstream consumer to buy Consumer Packaged Goods (CPG)—non-perishable stuff like toilet paper, toothpaste, laundry detergent, and diapers—on the Internet?
Despite the enormous size of this market, the vast majority of people still don’t use the convenience and power of the Internet for this category. In fact, consumers buy items like clothing and shoes—that need to be tried on and often returned—more than they do these simple CPG goods that are bought repeatedly in chore-like fashion.
The Answer
After many months, we’ve uncovered three main reasons why consumers choose to continue to drive to the store to buy CPG goods:
1) Shipping Fees. Paying for shipping stinks, and most online shoppers just can’t stomach the thought of paying $6 in online shipping fees for a $3 tube of toothpaste.
2) Competitive Pricing. Try buying CPG online today and you’ll often pay anywhere from 20% to 40% more than you do at traditional mass retailers
3) Online is Too Late. Lots of people buy CPG items when they run out, at which point online purchases aren’t really an option.
So there it was—build a service that had always free shipping, competitive prices, and a Netflix-like reordering queue that made it easy to plan ahead. Alice started coming to life, but it was easier said than done. 
The Big Idea
We realized very quickly that in order to solve the consumer’s problems, we couldn’t be a traditional retailer, buying products, marking them up, and making a profit on their sale. So instead, we changed the model, shifting from a retailer, to a platform that exists to help CPG manufacturers sell directly to their customers. Basically, we made a more direct connection between the companies that produce these goods, and the people that use them. And by eliminating the retail layer and opening up our platform for manufacturers to use as a direct channel, we were able to do two key things:
1) Create lots of efficiencies and cost savings that the CPG manufacturers could pass along to the end consumer in the form of competitive prices and free shipping, and;
2) Deliver targeted, value-added advertising opportunities for manufacturers to transform their traditional advertising dollars into added value for consumers (things like new forms of coupons, product samples and loyalty programs).
You can read more about the model on our press release here, but we are really excited to give CPG manufacturers the ability to come together on one platform to channel their resources in exciting new ways for the consumer. It won’t be easy, but at least we are swinging for the fences, trying to disrupt a model to deliver more value to an end consumer. (You can read more about our start-up philosophy on the flywheel blog here, if interested).
Introducing Alice, In Beta
Day one on our beta site you will see roughly six thousand unique products from hundreds of different manufacturers. You can read more about all the great ways we think you’ll be benefit as an Alice customer on our community blog here. And during our beta phase, we’ll be working hard to on-board as many manufacturers as we can onto our direct platform, expand our unique automatic coupon and other advertising programs, and continue to enhance the functionality and quality of our user experience. We hope you give the service a try, and we really look forward to your comments, and the opportunity to help you never run out of/for toilet paper again.
Hooray! and Congratulations! Now maybe Ladybug can get some sleep! Looking forward to using this new site.
motherladybug
Congrats. This is a great idea and I hope you’re as successful, if not more, than with Jellyfish!
I think this idea is great. I’m just playing around with a new account, seeing what kinds of prices and products you have, seeing if it will save me time and money. But it looks like a really innovative idea–and if it will save me time, and avoid shopping trips with all three children in tow, I’m for it! take care.
That’s pretty cool. Love the business model!
Congratulations on opening in beta! The site looks amazing, and I just love how it’s organized. I found it extremely easy to set up my products, and the reorder reminder schedule suggestions are pretty darn good.
I am surprised by the pricing, though, given the business model. It’s a little more competitive than some of the other models, but still doesn’t come close to my local market (Woodman’s). I’m currently weighing the value of my time – go to the market and save approximately $25 per trip, or order online and save the hour plus gas?
I’ll be placing an order soon!
This is brilliant! Conceptually one of the best ideas I have seen since I first read about the iPhone! This will be market changing! Best of luck and I look forward to you opening in the UK – I will definately be a customer!
Congratulations!
Just started playing around with this today after reading about it for months–very cool. I look forward to not never being out of toilet paper again and ending once a week Walgreen’s runs. Happy for me and happy for you guys for making this work.
Fantastic experience! Congrats!
Many journeys start with a question.
Alice’s started with: “Why doesn’t anyone buy toilet paper online?” Simply brilliant!
I think Alice’s “UnCoupon” feature is pure genius. Low friction – high efficiency. A killer feature.
For your readers not familiar, the coupon business in America is a multi-billion dollar business which used to be controlled by a duopoly: Rupert Murdoch’s QUAD and Kerry Packer’s VALLASIS. Together these two Australians had a cash cow which they used as a key source of funding to drive their ambitions and other media ventures through the 1980′s & 1990′s. Alice’s UnCoupon will be a significant business value component and revenue driver for Alice Corp. and has the potential be spun off as a stand alone business once it builds a little scale.
An example of Wisconsinovation at work. Bravo!
Thanks to everyone for the comments. It’s been an very exciting day for our team and very rewarding to see lots of hard work come to life.
We’re just getting started in terms of product assortment, coupons, promotions, etc., so I hope you all stay tuned.
Any word on this being release in Canada in the future?
I just came across the website yesterday and already placed an order. Not only that I couldn’t stop blogging about this great service. Thanks for bringing it to regular folks. Check out the blog at http://khannaphotography.com/BLOG/?p=1304
Thanks,
G
I have already placed an order! Your prices are competitive and not having to drive 40 minutes saves both gas and energy! Yippee!
I like your idea and have 2 questions:
1) Please help me understand something about your business model – you stated that you’re removing the retailers from the value chain. However, aren’t you just replacing the retailer with Alice? More to the point, Alice also needs to charge for your services that you provide, but I’m assuming that the markup is cheaper than that of traditional retailers, which is the reason why you’re able to offer products at lower price points…is that it?
2) I believe that the target audience of my own website could benefit greatly from Alice…do you or will you provide promotional opportunities in the future for website owners? Can you please share what those opportunities may be (i.e., affiliate marketing, etc.)?
[...] can read more about the secret sauce behind all these goodies from our President on our Company [...]
I’m really hoping that Alice will be my go-to site for all things household (and I have shares in drugstore.com!)… Add more green/organic brands (Mrs. Meyers, Dr. Bronner’s, Kiss My Face, Alba) & items (essential oils, calendula ointment et al) and it will be so.
Also, I just spent some time exploring… any chance Rebecca Thorman needs help? I am a former TV reporter/newspaper columnist turned plain ol’ writer/communicator. I want to be an animal at Alice.
In all seriousness, I look forward to seeing this company grow! Best of luck!
You had me at no shipping cost!
Just be sure that value to the customer is really VALUE and not just another manipulation to buy more. And if your manufacturers want to get closer to the end-consumer, they better be prepared. What that value is, I’m not really sure. I mean, how can Purex possibly improve my life?
And like the previous comment about an affiliate program, figure out how to put real dollars back in your customer’s pocket, maybe credits toward future purchases – something like that.
Congratulations on your launch. I look forward to using the site often.
[...] supplies, we still get in our car and take a trip to Target/Safeway. Instead, consider using Alice, an online tool that lets you purchase household goods direct from the vendor. They use their [...]
THANK YOU THANK YOU THANK YOU. For those of us living in lesser populated areas, this is fantastic. I would almost rather take a beating than go to Wal-****. To say nothing of their impact on the community.
In my little town, there was no grocery competition, until you came to town.
I just placed my first order. The website is easy to use, the prices are good. The confirmation said 3-5 business days, which is not bad shipping time.
Thanks again. Keep up the good work and keep adding new items.
Seems to me as a just-older-than-Boomer married to a Boomer, this is a great site for those of us who’d rather do something else in our retirement than drive 30 minutes to the big-box store then drive 30 minutes back home again. Not to mention that rolling around those humongous stores from this aisle to that aisle just because the things you want are never conveniently placed together is a royal pain that Alice might be able to help us avoid.
Yup, sounds like a winner to me. Now if it only works as well as they say it does…
Hello Mark-
I replied to your comments on my blog, but then I thought it more likely that you would see it here. So, let me know your thoughts after you’ve read my original response:
“Thank you as well for your thoughtful comments. It shows great strategy on the part of the Alice.com team and its creators. It’s smart social media engagement, an element of this initiative that could make or break a site like yours.
As an interactive marketer myself, I understand the distinction between personal and non-personal information gathering. But as a consumer, I’m still leery. Anytime thousands of marketers are gathered anywhere near my personal information I get skittish. Even so, I believe you when you insist that your policies will not allow my personal information to be given out. But with something this big, and with so many parties involved, I feel like someone somewhere might mistakenly leave a backdoor open. Maybe it’s just me.
Actually, I’ll tell you what: I’ll monitor your site for a year, gaining feedback from the stories I hear from users and the blogosphere. If the results are positive, and complaints are low, I’ll give it a try. Deal?”
Give my best to Alice,
John Jacobsen
[...] got word that Alice (in beta) had launched, plus my friend who happens to work in marketing and social media [...]
Probably your biggest mistake is not allowing consumers to see the search for products and see prices until after they’ve signed up. Everyone claims that they have the lowest prices, but until consumers can see proof I think many will be very reluctant to hand over their personal information.
Ascending Butterfly would love to host an Alice.com review and services giveaway!
http://ascendingbutterfly.blogspot.com
Yes, I’m persistent and shameless, that’s why my readers love me!
[...] a unique value proposition and a disruptive business model (you can read all about our model here) There are a lot of drawbacks to the start-up world, but building something from scratch like [...]
Fabulous idea! I know this will save me more money in the long run. I usually need to run to the store for just a few things. By the time I leave the store, I have bought many more items that were not originally on my list and I have spent more money than planned.
I’m recommending this to all my friends. Manhattan prices for every day products are insane and – due to the fact that we don’t cook much – most of our trips to the market/drug store are for the types of products Alice offers.
This is going to be/is a HUGE hit.
[..] .. Introducing Alice Alice.com Company Blog Immobilienrente .. [..]
The way you handle facebook freebie sites is horrendous & very unfair. You need to make changes to your registration & communicate with the freebie site employees so they know what the heck is going on. Right now my perception is YOU SUCK & I would not recommend you to any company & any chance I get I will let them know how you operate a& encourage compaines not to use your services!
Wonderful web site. Lots of helpful information here. I¡¦m sending it to some friends ans additionally sharing in delicious. And naturally, thanks in your effort!
certainly like your website but you have to test the spelling on several of your posts. A number of them are rife with spelling problems and I find it very bothersome to tell the truth nevertheless I will surely come again again.
Thank you for any other informative blog. The place else may just I get that type of information written in such an ideal way? I’ve a mission that I’m just now running on, and I’ve been on the look out for such info.
I would like to thank you for the efforts you’ve put in writing this website. I’m hoping the same high-grade blog post from you in the upcoming also. Actually your creative writing abilities has encouraged me to get my own web site now. Actually the blogging is spreading its wings quickly. Your write up is a great example of it.
I’ve been surfing online more than 3 hours today, yet I by no means found any interesting article like yours. It¡¦s lovely price enough for me. In my opinion, if all webmasters and bloggers made just right content as you did, the web might be much more useful than ever before.
fantastic post, very informative. I wonder why the other experts of this sector do not understand this. You must proceed your writing. I am confident, you’ve a great readers’ base already!
how do i go about downloading the new g23 script