Walmart shutting down Jet.com after buying it four years go for $3.3B
Walmart said it’s shutting down Jet.com, just four years after it shelled out $3.3 billion to buy the online grocery startup in a bid to compete with Amazon.
The world’s biggest retailer scooped up Jet.com — founded in Hoboken, New Jersey, by e-commerce pioneer Marc Lore — in 2016 in a bid to beef up its e-commerce operations, especially in bigger metro areas including New York.
But despite its purple logo and quirky ads aimed at millennials, Jet.com had been heading southward for more than a year when its employees were transferred to work on the Walmart.com site in June and president Simon Belsham stepped down amid declining sales.
Nevertheless, Lore is now chief executive of Walmart’s e-commerce business in the US, which logged a 74-percent sales gain in the most recent quarter, the company said on Tuesday.
“Due to continued strength of the Walmart.com brand, the company will discontinue Jet.com,” Walmart said in its earnings statement, adding that Jet.com had been “critical to accelerating our omni strategy.”
The Jet.com site is still operational and Walmart did not provide a timeline for when it expects to discontinue it.
“Walmart ending the Jet.com experiment isn’t a surprise,” said retail consultant and former Amazon executive Brittain Ladd. “I’ve always believed that Walmart acquired Jet.com to leverage Marc Lore and his team to help accelerate the adoption of e-commerce at Walmart.
Ladd added that “Walmart has improved their e-commerce capabilities, but Amazon dominates Walmart in e-commerce and will continue to do so.”
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