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Businesses

Walmart Buys Jet For $3 Billion, Hopes To Turbo Charge Ecommerce (venturebeat.com) 98

Walmart says it has agreed to acquire online retailer Jet.com for $3 billion in cash. As a promise, Jet.com says it will deliver cheaper prices on a range of goods by encouraging users to buy more items at the same time or to purchase products located in the same distribution center -- thereby cutting collection and shipping costs. ZDNet reports:Overall, it's clear that Wal-Mart has Amazon envy and needs to scale its e-commerce operations. The Jet management team has had experience battling Amazon through Quidsi and its brands such as Diapers.com. As for the deal, Wal-Mart said some of the $3 billion for Jet will be paid over time and $300 million of Wal-Mart shares will also be part of the transaction over time.
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Walmart Buys Jet For $3 Billion, Hopes To Turbo Charge Ecommerce

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  • Turbo Charge? (Score:5, Insightful)

    by luis_a_espinal ( 1810296 ) on Monday August 08, 2016 @10:06AM (#52664431) Homepage
    Walmart doesn't need to turbo charge its commerce site. It needs to rewrite it? Have you tried searching for something in its online catalog? It's like a trip to Altavista circa 1995.
    • by drinkypoo ( 153816 ) <martin.espinoza@gmail.com> on Monday August 08, 2016 @10:59AM (#52664743) Homepage Journal

      Sears.com is, bar none, the most crufty and crappy e-commerce site I have ever seen. When you combine that with their high prices and poor customer service, it's a wonder they haven't folded already.

      It's especially pathetic when you consider that Sears used to be synonymous with shopping from home in America. They let Montgomery Ward's consume their mail-order business, and then Ward's was consumed by the proliferation of cheaper shop-at-home options; they died off before the web even became a serious force there. They have the shipping lines and the will call facilities to be the name in home shopping, but they don't seem to have the supplier networks any more. Literally everyone else has better prices.

      • Sears.com is, bar none, the most crufty and crappy e-commerce site I have ever seen. When you combine that with their high prices and poor customer service, it's a wonder they haven't folded already.

        It's only a matter of time I think. Sears (and Kmart - same company now) have been in a seeming death spiral for quite a while now. Stunningly badly managed. I actually worked for Kmart for a brief time and my experience working there was so bad I've been rooting for them to die in a fire ever since.

      • by jbengt ( 874751 )

        They [Sears] let Montgomery Ward's consume their mail-order business . . .

        Montgomery Ward was the leader in the mail-order business before Sears existed.

        • Montgomery Ward was the leader in the mail-order business before Sears existed.

          But then Sears became the leader in that market for many years. Ward's made a brief comeback before exploding into fiery failure.

      • by Solandri ( 704621 ) on Monday August 08, 2016 @01:03PM (#52665747)
        Sears.com is what you get when a store decides to sell its brand name as a storefront. The vast majority of items on the sears.com site are sold by third party sellers who are paying Sears a commission to appear on their website. eBay has pretty much become the same thing. Newegg does it as well, though they do provide an easy way for you to restrict your search to only Newegg items.

        Most troubling, Amazon is doing this now. You'll notice that sometimes an item on Amazon is listed as "sold by FooBar, fulfilled by Amazon." This is a huge, huge problem. It means FooBar sends their inventory to Amazon who stores it in their warehouse, then Amazon ships it to you when you order it. The problem is, Amazon doesn't keep track of FooBar's inventory - they intermingle it with their regular inventory. If FooBar sends Amazon fake memory cards, that means you can order memory cards from Amazon (not sold by FooBar), and still end up receiving some of FooBar's fake memory cards. It's gotten so bad I've completely stopped buying easily counterfeited items like memory cards from Amazon, and pay a little more to buy them from a local big box store who buys in bulk directly from the manufacturer or a big distributor.
        • If a product has a "frustration free" packaging option, you can generally avoid this issue.
          Those items are inventoried separately. Some brands even create Amazon-specific packaging for this program. I recently bought an SD card from a major brand that came in packaging made exclusively for Amazon (complete with Amazon's name on it). Some rando shitstain seller dumping clones and fakes from China isn't going to get his shit in that same inventory pile.

      • they're another in a long line of companies that got "Bained". They owned a ton of property (it's how they survived so long, they could weather down turns in the economy because they weren't saddled with expensive leases). They got bought out and liquidated for the short term gains selling their property. I miss them. They were a few steps above Walmart/Target without the crazy expensiveness of a Men's Warehouse. I've got a 40 year old freezer bought from them that still works great.
    • I tried to purchase diapers for my granddaughter to be picked up at a store in another state. It did not go well since they somehow lost her name and would not allow her to pick up them. I would purchase a lot more if they would have tickets around the store for items. For instance a computer motherboard that would have a ticket for it. I would just give the ticket to the clerk who would scan it and than the item would be delivered to the store where I would pick it up and return it if anything was wron

    • When Walmart released their cloud software it was evident that they had someone that knew what they were doing behind the scenes. It just wasn't their front facing website.

      What they need to do is set up a half decent API and 'open source' the front ends. Sell a Rasp Pi with keyboard to plug into any TV with HDMI that has all the tools needed to make a front end. I know 14 year old me would have loved to have development tools that cheap.

      Give away $1,000, $10,000, $100,000 prizes (Walmart credit of course)

      • The best front end interface is an SQL editor.

        SELECT Title, Description, Brand, Price, AggregateRating, InitialSaleDate
        FROM Basic_Product_View_USD
        WHERE
        (Title like '%Thing I Want%'
        OR Description like '%Thing I Want%')
        AND InStock = 1
        AND Price = 4.0
        AND InitialSaleDate >= '01/01/2015'
        AND NOT Seller = '3rd Party Shitfest'
        ORDER BY AggregateRating DESC, Price ASC, InitialSaleDate DESC, Title, Product_ID

        Add in natural language indexes for your search term (which all serious SQL servers give you) and baby you've

    • by tattood ( 855883 )

      Walmart doesn't need to turbo charge its commerce site. It needs to rewrite it? Have you tried searching for something in its online catalog? It's like a trip to Altavista circa 1995.

      That's what they are doing. If you don't have the technical expertise to do something, you either pay someone to write it for you, or you buy something that is already written. Jet.com is going to turn into Walmart's web front end.

      • Jet.com turning into Walmart's web front end is not a great improvement. Jet's search leaves a LOT to be desired.

        Or maybe it's their selection that leaves a lot to be desired. I never bought anything from them because my local dollar store usually has a better selection.
    • by mjwx ( 966435 )

      Walmart doesn't need to turbo charge its commerce site. It needs to rewrite it? Have you tried searching for something in its online catalog? It's like a trip to Altavista circa 1995.

      To use the correct car analogy, they don't need to turbocharge (one word, turbocharge is one word) their e-commerce, they need an engine swap, replacement suspension and new body panels.

  • by Fly Swatter ( 30498 ) on Monday August 08, 2016 @10:13AM (#52664471) Homepage

    They have no warehouses, they are just a paper storefront to the cheapest seller for that particular item. You never know who is actually sending you the products. Seems way overvalued.

    • by b0bby ( 201198 ) on Monday August 08, 2016 @10:23AM (#52664535)

      It seems to me that it's even better - they set the lowest price, to beat Amazon et al and build market share, but as far as I can tell they actually are paying their partners their regular price. I imagine that the difference is being made up by venture capital. Back to 2000 - we'll make it up in volume!

      I base this on the fact that when I have bought stuff through them (because the price is the lowest) I have got an enclosed receipt from whoever actually shipped it with their normal price on it. Now, it may be that Jet gets a discount from that on the backend, but I doubt it's enough to cover all of it.

    • Jet.com does have warehouses.

      Most products on Amazon are actually coming from Amazon partners and often shipped by the Amazon partner direct to the consumer. Many commonly ordered items are delivered by the partners to Amazon to stock in an Amazon warehouse for faster delivery. Rarely is Amazon the actual entity that is the seller, Amazon has little interest in spending its own capital on stocking inventory.

      Jet.com did originally attempt to build market share by advertising products that weren't even fro

      • by swb ( 14022 )

        How does "Sold by and shipped by Amazon.com" work then?

        To avoid junk or misrepresentation, I usually choose the Amazon-as-seller option. vs. the negligible savings of a third party seller.

        I can believe that products Amazon sells and stocks are merely "owned" by Amazon in the sense that they essentially just act as a logistics warehouse, perhaps paying some small premium to possess the item in their warehouses to meet Prime delivery obligations.

        • "Sold by and shipped by Amazon.com" means that Amazon is the retailer, has purchased the inventory, and they bear the risk and cost of holding that inventory.

          Third party sells have 2 options. They can list on Amazon and ship from their warehouse. The other option is that they can rent warehouse space from Amazon. Amazon will then ship the goods for them. The 3rd party has to stock the warehouse and bears the risk and cost of inventory.

    • It does have some warehouses, but it's true they just laid on a gimmick to the Amazon marketplace concept to wow rubes like Walmart
  • Shopping this weekend took me there, and something about it felt like a scam, I paid 30% more somewhere else rather than give them my payment info (I was worried I'd get subscribed to something).

    • by Nehmo ( 757404 )

      ... felt like a scam, I paid 30% more somewhere else rather than give them my payment info (I was worried I'd get subscribed to something).

      Anytime you give your payment info to another party online, you are taking some risk. Even a trusted recipient can be insecure with the data. But that risk can be managed. (Read up on the subject if you need to. You can always just use a card with only a small balance.)

      And by "subscribed to something" do you mean a recurrent automatic withdrawal from your money? If so, has that happened to you before? Did you try to correct it?

      • by fnj ( 64210 )

        Jet did have a recurring membership fee for a time. They dropped it, but they still wanted to retain my credit card info and did not accept PayPal. I gave them one of those "fake card" numbers you can get from your credit card provider, funded with only a small prepayment, and with a short expiration time.

      • by AvitarX ( 172628 )

        It's never happened to me, but it's something I'm away of happening (small pre-checked box to sign up for a savings club or some such).

        It looks like Hey did actually do that in the past, so my feel of the site's vibe was correct.

        One thing I do to mitigate risk is bit do business with what feels like fake businesses, and the constant ways they pushed extra discounts were part of that.

        Also that they specifically wanted a debit card seemed a little shaky to me.

  • by Anonymous Coward

    "The Jet management team has had experience battling Amazon through Quidsi and its brands such as Diapers.com."

    They failed to mention that Amazon now owns Quidsi and the sub brands since 2010

    • by Nehmo ( 757404 )

      They failed to mention that Amazon now owns Quidsi and the sub brands since 2010

      Good catch.

      https://www.quidsi.com/brands Businesses of an industry tend to agglomerate over time - like planets forming from dust and asteroids. There's even a math formula to predict the distribution member sizes tend to. Someone else probably can explain this. I can't. Except for monopolistic implications, in most industries, this is not such a bad thing. Size often makes for efficiency.

      (I should note, however, in the news media industry, it's definitely a bad thing. We get deprived of alternative poin

  • by QuietLagoon ( 813062 ) on Monday August 08, 2016 @10:37AM (#52664595)
    The prices were usually quite good. What I liked was the ability to ship to to a local store (5 miles away) and pick it up there for zero shipping charge. Usually the pickup was next day, occasionally it was two day. My first order was same day, about 5 hours after I placed the order, it was ready for pickup. All for no shipping cost.

    .
    That's so much better than Amazon's having to wait three days to a week before it is even shipped if you opt for free delivery. (I'm not talking about amazon prime's free shipping, I don't pay $100 per year for free shipping when the product price already has shipping charges baked in. So you amazon prime fanbois don't have to post how great prime is.)

    • by fnj ( 64210 )

      Fat lot of good Walmart free pickup does me. The nearest Walmart is 50 miles away in blindingly congested traffic, and I don't drive much. Their basic shipping is mostly USPS and is as slow as watching paint dry.

      Amazon's Prime went to absolute shit when one day with no warning they changed from sending everything UPS or FedEx to my door, and started using horrible, dog-slow USPS service. There is no USPS delivery here, it is hell to get to the post office, try to find a parking space, wait forever at the co

      • ...Fat lot of good Walmart free pickup does me. The nearest Walmart is 50 miles away in blindingly congested traffic, and I don't drive much....

        Yeah, if there's no Walmart near you that you can get to conveniently, the free in-store pickup is a non-starter.

      • by jbengt ( 874751 )

        Fact: when you give Amazon a post office box number to ship to, poof; there goes your Prime 2-day shipping

        That should be obvious since UPS, FedEx, et al, cannot deliver directly to a USPS Post Office Box.
        By the way, where do you live in the U.S. where the USPS does not deliver to you?
        I know there are places in the US where UPS & FedEx won't go, but will instead forward the package to the USPS for final delivery, but I'm not aware of any place where it's the other way around.

        • by fnj ( 64210 )

          By the way, where do you live in the U.S. where the USPS does not deliver to you?

          You're the one guy who asked me nicely, so I'm glad to tell you. Eastern Massachusetts - Cape Cod - pretty heavily populated, but anywhere outside of the larger town centers there's no home delivery. I'm on a private road, so they won't even deliver to roadside mailboxes. In fact, they won't even deliver to a mailbox at the END of the road, where it joins a main town road. There are plenty of places in the US with no front door

      • What kind of remote bumblefuck place do you live in where USPS shipping is slow, and there's no delivery? I ship USPS First Class small packages all the time, all around the country (and internationally too), and it almost never takes more than 3 days to get anywhere, and frequently it'll take 2. Even packages to Canada arrive in about a week, a bit longer for Europe.

        You must either live in Alaska or some remote part of North Dakota or Montana or someplace like that. That's what you get for living that f

        • I have the same problem in my town of 3000. Inside of the city limits if you want mail you MUST buy a PO Box for $110 a year. Live outside of the city limits you get free home delivery because you are on a rural route and have contracted delivery. I must have a PO Box as a billing address for credit cards and utility bills. So I am required to give my billing (PO Box) and shipping (Street) address. The problem is when the dumb asses ask for a shipping address and MAIL me a package. FedEx has Smartpost. Whic

          • What weird-ass state is this in? I've never heard of the USPS requiring PO boxes for anyone, or not having residential delivery service just about anywhere.

            • Do some research. The US has over 1200 Zip codes that do not have home delivery. I did a research paper on it back in High School. It is 100% at the discretion of the USPS if you get home delivery of your mail.

        • by fnj ( 64210 )

          I don't CHOOSE to have a PO box, you objectionable, presumptuous person. It's the only way I can get mail. And yes, first class USPS is pretty fast, but Amazon won't ship first class. They ship by the method THEY choose. And don't presume to tell me where I live. I live on the East Coast, about 1-1/2 hours south of Boston.

          By the way, Amazon only changed their shipping policy a couple of months ago. Up until then, Prime shipping worked like a dream.

    • by sjbe ( 173966 ) on Monday August 08, 2016 @12:13PM (#52665323)

      What I liked was the ability to ship to to a local store (5 miles away) and pick it up there for zero shipping charge.

      Zero shipping charge but you spend 30+ minutes (minimum) of your time plus gas going to pick it up. It might be cheaper depending on what you are having sent to you but the price isn't zero. Plus you have to actually go to a Walmart which is something I'd actually pay to avoid. My nearest Walmart is about 8 miles away so with my truck I'll spend roughly 3/4 of a gallon of fuel to get there and back. At local fuel prices as I type this (around $2.25) that is about $1.68 per trip in fuel alone for "free" in store pickup. Not even counting the value of my time either. Not bad but not great either. See below.

      That's so much better than Amazon's having to wait three days to a week before it is even shipped if you opt for free delivery. (I'm not talking about amazon prime's free shipping, I don't pay $100 per year for free shipping when the product price already has shipping charges baked in.

      You are aware that Walmart has their own version [walmart.com] of Prime, right? Whether Prime is a good deal depends on how you shop. For me I buy a LOT through Amazon so on a per transaction basis it would be substantially more expensive (not to mention time consuming) for me to go pick something up at Walmart every time I placed an order. I placed 154 orders through Amazon in 2015, so the freight cost per order was $0.65 per order. That's less than the cost of gas to my nearest Walmart and back AND I didn't have to waste my time traveling to Walmart.

      • ...Zero shipping charge but you spend 30+ minutes (minimum) of your time plus gas going to pick it up. It might be cheaper depending on what you are having sent to you but the price isn't zero.

        I tend to be in the area at times, so it is convenient for me. As I mentioned to another poster, if it is not convenient, then the free in-store pickup is a non-starter.

        .
        But I do agree with your point about not wanting to go to Walmart. They're not the best store in the area.... (and I'll leave it at that)

    • by Solandri ( 704621 ) on Monday August 08, 2016 @12:47PM (#52665619)
      Drove to the local Walmart 5 miles away. I needed to pick up some stuff from Home Depot, so I was going to be in the area anyway.

      Walk in. There are no obvious signs saying where to pick up Internet orders. I ask an employee (there are a lot of them near the front). He says I need to go to a counter near the back of the store.

      Walk to back of the store and find what looks like the right counter. Nobody is there.

      Wait 3 minutes in case the person had just stepped away for a bit. Finally decide there's really nobody there.

      Spend 5 min wandering around trying to find a Walmart employee (not so many of them near the back). Finally find one. She says that's not her department, but she'll page the guy who's supposed to be there.

      Wait at counter for 5 more minutes. Just as I decide the lady lied to get rid of me, two other Walmart employees walk out a door next to the counter. I ask them for help. They say the guy who works the counter is eating lunch. One of them helpfully says she'll tell him someone is waiting, and goes back in. She walks back out a minute later and says he'll be right out.

      Wait 5 more minutes. Just as I'm about to go in search of another employee, the guy comes out still chewing (apparently finishing what he was eating was more important than a waiting customer). I show him my Internet purchase receipt. He walks to the back of the room and starts digging through mounds of haphazardly piled items.

      After 5 minutes of searching, he finds my item, brings it to me, has me sign saying I've received it.

      I walk out wishing I'd ordered on Amazon so I could have the last half hour of my life back.

      I've done ship to local store at a lot of places. Staples, Office Depot, Home Depot, Lowes, Fry's (their prices for small items tend to be better than Amazon's). All of them get it right - in and out in less than 5 minutes. Not so for Walmart. If it's not on their store shelves, or they won't ship it for free or a reasonable cost, I get it elsewhere. I'm never doing a local Walmart pickup again.
      • by phorm ( 591458 )

        apparently finishing what he was eating was more important than a waiting customer

        Uh, yeah. Being able to take your scheduled lunch (which is generally on your time, your dime) IS important, actually. If there's a problem with the location not being open when it should be (due to holidays, illness, or just somebody wanting to eat their f***ing lunch), then it's because somebody in management - who gets paid a lot more than this guy I'm sure - didn't make it a priority to ensure that the position was properl

      • by DogDude ( 805747 )
        You buy from the cheapest merchant you can find, and then are disappointed to find that you get terrible service? Really?
      • Wait 3 minutes in case the person had just stepped away for a bit.

        At the Walmart stores I've done pick-ups at, there were call buttons at the pickup desks. I didn't have to go looking for anyone, though I still had to wait several minutes.

        the guy comes out still chewing (apparently finishing what he was eating was more important than a waiting customer).

        According to some one I know who works for Walmart, there are strict rules about employees taking their breaks on time and for the exact time scheduled. He claimed employees have been fired for returning early from breaks.

        So this likely means the store manager either didn't assign an alternate or the alternate was assigned to cover more

    • Amazon Prime gives me free access to thousands of books, movies and TV shows and tens of thousands of songs. Plus I get my stuff delivered to my door in two days.
      Worth $8/month?
      Hell yes!
  • by Stormy Dragon ( 800799 ) on Monday August 08, 2016 @11:42AM (#52665085) Homepage

    I saw this in my RSS feed and thought, "$3 billion is a lot of money to pay for one jet"

  • by Anonymous Coward

    And here I was thinking: what does an expensive airplane got to do with e-commerce?

    People please. There is a difference between "Jet" and "Jet.com". Especially since other countries (with Walmart acquisitions present) also have retailers named "Jet" [jetonline.co.za].

  • So when I read the headline, my head said "Wait what?! 3 billion for a plane? WTF did they buy, a B-2 and 2 F22's??!"

    Then I realized this will be a hopeless play at trying to play catch-up after 15 years of staying still.

  • Retail is a brutal industry. Just look at retailers in the U.S. over the last century -- it's like the rise and fall of great empires. Again and again, dominant incumbents are unable or unwilling to innovate and stay ahead...or they blow money on expensive but useless projects like the Sears Tower.

    While I don't follow Walmart closely, a few business sources I read summarized the company's recent strategy as cost-cutting and aggressive inventory management (keep fewer items in-store) to generate more free ca

  • Walmart is subsidized by your's truly - the US taxpayer. Will that subsidy now increase to afford this acquisition?

    And, $300M in stock is not cash - until it is cashed.

Two percent of zero is almost nothing.

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