Jet.com has decided to scrap its membership fee which was thought to be the discounter's main source of revenue.

The new online retailer, which launched in the US over the summer, has scrapped its $50 membership fee in order to attract more shoppers, according to technology website, Re/Code.

Jet.com offers members savings which are increased depending on whether shoppers add more products to their orders and are prepared to wait longer for deliveries.

Using pricing algorithms, the e-tailer matches the basket item to similar products in the same merchant's warehouse and offers a real-time discount. The data is also used to triangulate the optimum merchant, packing and shipping zones to reduce system costs and in turn reduce prices for its customers.

Jet.com has said customers have got used to the 'Smart Cart' savings model quicker than expected, which has led to the elimination of the membership fee because Jet said there is less need to offer upfront discounts on individual products.

While customers will no longer have to pay the $50 annual fee, discounts are likely to drop from around 10% per order to 5%.

Jet.com currently has around 2,000 retail partners which conduct two thirds of customer fulfilment, with Jet.com supply and delivering the remaining third.

The marketplace encourages customers to engage with these third party retailers, and many offer further discounts in exchange for personal information. Customers are also rewarded with Jet Cash if they spend money with partners rather than Jet.com directly, implying the direction the marketplace is hoping to move in.