Walmart just bought Jet.com
Steve’s breakdown: This purchase will no doubt have an impact on the marketing budget. As for their creative, I’m just not really getting the “Mind blowing” campaign R/GA has been doing. There’s just nothing mind blowing about Jet.com except for getting bought for $3 billion.
HOBOKEN, NJ: It’s a done deal.
After days of rampant rumors, Walmart on Monday said it has reached an agreement to buy fast-growing online retail newcomer Jet.com, which had a splashy debut a year ago.
At the time, Jet.com owners made the bold prediction that it would challenge Jeff Bezos’ online leader Amazon.
Walmart will pay $3 billion in cash and another $300 million in stock for the privately held company.
The deal underscores how serious Walmart is about igniting its online business — and how poorly it has executed a flawed and underwhelming digital strategy to date.
The brick-and-mortar discounting giant, which for years buried rivals by investing in technology to make its cost structure lower than any other retailer, ironically couldn’t pull off the most import piece of tech investing: online selling.
Buying Jet.com would let Walmart compete more effectively with Amazon.com and other online retailers. The deal also reflects the difficulties for startups like Jet.com to make it on their own in a sphere dominated by Amazon and its network of distribution hubs and the powerful asset of its Prime membership program.
The deal follows a series of acquisitions by major traditional retailers of online start-ups in an extremely competitive landscape.
Walmart shares were up 34 cents in pre-market trading, to $74.10