Jet.com has something Wal-Mart can use to rocket its online presence forward: advanced online infrastructure, patents, a wealth of technology experts, and users.
Together, Wal-Mart can beat Amazon at its own game by doing what Amazon is already doing (building more, smaller DCs everywhere) using what they already have (massive retail locations everywhere).
It does have a cooler looking website than walmart, and possibly even amazon. FWIW.
(Also curious about the banned product lines if anyone can summarize/link to what's going on there.)
I doubt anyone monitors it, everytime I ring them they bounce me from idiot to idiot
I now need access to some invoices for purchases I made last year for accountant but cant login, and of course all my digital purchases are gone, the 2 kindles are useless.
- reviews of products
- no customer q&a section
- no 3rd party seller ratings
These are rather basic features in an ecommerce site. So no, I don't think the guys from jet.com are experts at all.
That isn't to say WalMart can't (or shouldn't) transfer some of their experts to Jet, and some Jet experts elsewhere. Just that they cannot afford to lose all their experts in the core business to the online dream.
I too expect this to turn out to be a terrible decision, but I've been proven wrong on my expectations before. Reasons like the above is generally why.
However, it does make sense for a company like Walmart. I don't know about 3B, but Jet is a drastically cooler brand for them in their ecommerce battle esp. among millenials.
Jet was previously fulfilling many orders from Walmart and now they can build a seamless integration to deliver competitively priced items quickly from the stores.
Every time I see a comment like this, it really makes me wonder who these mythical millenials are. I work in a company with 11 millenials out of 16 employees and NONE of them have even heard about Jet, let alone bought from it. Now that Jet was acquired and will be quietly folded into Walmart, it's more than likely they never will.
They use Amazon almost exclusively for all of their shopping needs.
Not sure where you got the notion that 'Jet is a drastically cooler brand'. It seems false both from anecdata I have and from the design of their website, which looks like a cheap knockoff of Amazon.
Sure - many millenials haven't heard of it yet, but that's beside the point. Everyone has heard of Walmart but they struggle online. In your anecdote, 30% have brand recall which isn't as bad as you make it seem.
The problem with Jet as it currently stands is that it isn't very compelling for word of mouth. I've used it and had a decent experience but never told anyone about it.
Anyway, Walmart can put more muscle behind it, likely deliver a better service and push a cooler brand than their own. At the same time - they can utilize their store inventory and distribution/shipping and potentially drive consumers to pick up in store same day (and drive more in-store revenue).
You make an assumption about them folding it in. I don't think they will, but if they do it will be a waste.
Also - your note about people you know using Amazon for all shopping needs doesn't mean that it will always be that way. Do you expect everyone to roll over because Amazon is the leader? Should nobody bother competing?
- Amazon has a LOT of fake reviews. - They're pissing off merchants by competing directly with them. - They often ship other merchant's products instead of your own if it's closer to the user.
I'm not that bullish on Jet either, but I wouldn't underestimate Walmart.
I think you misread the parent - he said that out of 16 employees, 11 were millennials and none of those had 'brand recall' as you insist on calling it.
Apart from that, I'd bet that most or all of the 11 millenials would say Walmart is probably one of the least exciting, least cool brands they're know.
There are some huge assumptions built into your comment.
How so?
So they've been eating the cost of shipping and overhead with no margins and have zero loyalty because they don't really have a unique value proposition.
They failed with their initial subscription model. They say they can keep costs low with their technology and rewards based shopping but they haven't proven anything.
It gets better with Walmart though - now they have a supplier and distribution hub that has great relationships with countless vendors.
Walmart brings the solution to that to the table. They already have the merchandise, and infrastructure. While the general opinion of Walmart is that they are terrible, Walmart's distribution and transportation infrastructure is King in that world.
Currently Jet.com fulfills orders by just going to the stores and purchasing and shipping.
A public company like Walmart, there's some people doing
some math here.
Yahoo also reported that it's writing down $482 million
in charges related to the declining value of Tumblr,
the social-blogging service that Yahoo acquired for
$1.1 billion in 2013.
and the company is writing off $7.6 billion related to
its acquisition of the Nokia phone business. That's more
than the $7.2 billion Microsoft paid for Nokia's phone
business last year.
1) A calculation of risk/reward on this investment
2) Determining whether result of 1 appropriately reflects Walmart's risk profile.
Given that Walmart decided to acquire, it is safe to assume this investment's risk of loss falls within Walmart's investment profile.
Translation: "I can't see how this deal makes sense but WalMart is a huge company so it has to make sense even if to me it doesn't".
By that logic no big company would ever fail or screw up. Every time there's a huge acquisition there are some people here making this fallacious argument or a variation of it. There are always people "doing some math" inside these companies, that doesn't mean that the success of any given strategy is a given.
The equation they're solving for is probably not, "How can we maximize Walmart's profits?", though. It's "How can I maximize my own immediate career goals?"
I think building Amazon wasn't cheap too. Amazon made losses for most of two decades straight, so Walmart dumping massieve money into building a competitor, with the insights of today, might still be cheap, relatively.
... the case for Amazon getting crushed by Wal-Mart doesn't stand up when you do some side-by-side comparing of their Web sites. What's wrong with Walmart.com? Put simply, it settles for taking orders for the products people come looking for rather than enticing them to buy things they hadn't even thought of buying.
http://www.bloomberg.com/news/articles/2000-12-17/walmart-do...
It's 16 years later and Walmart still hasn't been able to compete with Amazon very effectively.
It's useful to note that those 10 biggest websites are operated by large retailers with a physical presence, so it doesn't necessarily mean they're in trouble (walmart, macy's, home depot, etc.)
But the gap between Amazon and the next biggest e-tail site is huge. It's more of a canyon than a gap, really.
are your serious?
Walmart's revenue was $482.1[0] billion in 2015 and amazon's was $107b[1]
[0] - https://www.google.com/webhp?sourceid=chrome-instant&ion=1&e...
[1] - https://www.google.com/webhp?sourceid=chrome-instant&ion=1&e...
edit - sorry, i missed the .com part