Walmart shuts down Jet.com as online sales surge

Walmart is pulling the plug on Jet.com after acquiring the online venture for $3 billion in 2016.

It cited the "continued strength of the Walmart.com brand" for the decision in its latest earnings report, which showed a 74% increase in e-commerce sales. The retailer added that the Jet.com acquisition was “critical to accelerating our omnichannel strategy”.

“There has always been a level of confusion regarding why Jet.com was founded, and why Walmart acquired the company,” comments Brittain Ladd, a supply chain consultant and former Amazon exec.

“Put simply, the founder of Jet.com, Marc Lore, made the decision to create a platform to compete against Amazon as he knew someone would acquire the company. Let me be clear, Lore never believed that Jet.com could compete against Amazon. He did, however, know he could sell the company for billions. He just needed the right buyer.”

In 2016, Walmart was in the stone age regarding e-commerce, Ladd believes. “Worse, it was a Sisyphean task to get the executive team at the company to believe in the value of e-commerce to a retailer with thousands of stores.”

“Walmart CEO Doug McMillon, made the decision to acquire Jet.com so that he could gain access to several key pieces of technology plus inherit a team capable to leading Walmart’s e-commerce push. It worked. Walmart has improved greatly thanks to Lore and his team,” Ladd continues.

“I argued with Walmart in 2016 not to acquire Jet.com and instead, acquire Shopify. Imagine how different Walmart would be if they had acquired Shopify?” he concludes.