Jet and Walmart, a tale of two marketplaces

Marketplaces aren’t just the future — they’re the present. In 2016, global shoppers did half of their online shopping through marketplaces like Amazon, and the number is only going up. Walmart jumped on the bandwagon that year with its $3.3 billion acquisition of to shake up retail giant Amazon’s hold on e-commerce. But the online retailer is increasing its proportion of first party listings. Walmart also acquired brands like Modcloth and Bonobos and utilized Jet as the name to house these youth-oriented brands under. A tension now lies in budget: Jet spent a lot of money to acquire its customers, but Walmart is tightening its belt.

In a comment to Retail Dive, Vivaldi Partner Pete Killian said, “Arguably Jet appeals to a younger, more urban, more upscale consumer – but our data does not show they are distinguished on this. All online shoppers are younger and more urban. Jet’s demo is not Jet’s brand. Their brand today is not strong enough to reposition Walmart’s in appealing to a new demo. The goal is not to ‘avoid association with Walmart’ — Walmart’s brand is much stronger than 10 years ago — but rather the challenge is how to have Walmart and other brands complement each other.” There’s no evidence that Jet is waning, “but the logic of e-commerce brands dictates that the future of Walmart + Jet =  Walmart.”

Type: News