While marketplace sellers wait to hear from Wal-Mart and Jet about their combination, they have strong opinions on what they’d like to see next.

Wal-Mart Stores Inc.’s pending acquisition of Jet.com Inc. impacts more than just the two retailers in talks—it also affects the roughly 3,000 merchants that sell on the retailers’ online marketplaces.

Wal-Mart on Monday announced plans to acquire 1-year-old online marketplace Jet in a cash and stock deal valued at $3.3 billion. While Wal-Mart is best-known as the world’s largest retailer by revenue and has an online presence that brought in $13.7 billion in sales last year, it also has a much smaller online marketplace business that allows outside merchants to sell on its e-commerce site, similar to business models operated by Jet, Amazon.com Inc. and eBay Inc.

Wal-Mart has about 600 retailers and brands selling on Walmart.com as marketplace sellers, Internet Retailer estimates. Jet has more than 2,400 merchants selling on its site. Wal-Mart says Jet will continue to operate as its own distinct brand, for now.

It’s unclear how the acquisition will affect Wal-Mart and Jet sellers, as neither company has reached out to merchants regarding the deal, but some marketplace sellers say it’s best for their businesses to keep the brands separate.

Wal-Mart and Jet make a good couple but should remain separate entities, says Jason Boyce, co-founder and CEO of online sporting goods retailer Dazadi Inc. While the two companies tout their low-priced products, Jet does it “a lot sexier than Wal-Mart,” Boyce says. Dazadi, No. 673 in the Internet Retailer 2016 Second 500 Guide, sells on several online marketplaces in addition to its e-commerce site, Dazadi.com. Online marketplace sales represented 65% of its $16.2 million in revenue in 2015.


“Both companies offer low prices, but Jet’s branding ‘makes it OK’ to bargain shop,” Boyce says. “Our preference would be to keep the sites separate. If Jet and Wal-Mart were to combine under the Wal-Mart flag, they would lose a lot of Jet customers,” he says. 52.4% of Walmart.com’s shoppers have an annual household income of $60,000 or less, according to Top500Guide.com data.

In addition, rolling Jet under the Wal-Mart brand may hurt some merchants because of how the Wal-Mart brand is perceived compared with the Jet brand. E-retailer OrthoticShop.com, for instance, only offers some of its inventory on Walmart.com, in contrast to Jet, where it offers its full product assortment. It’s not by choice, though. Some manufacturers of OrthoticShop’s products don’t allow the company to sell their products on Walmart.com, says Matt Behnke, president of the comfort footwear retailer.

“There’s still this stigma that Wal-Mart equals ‘cheap,’” Behnke says. “Some manufacturers thinks selling on Wal-Mart cheapens their brand.”

OrthoticShop began selling on Wal-Mart this year, and Behnke says there have been a few instances where manufacturers have asked them to take down the manufacturers’ products that the retailer was selling on Walmart.com. This has never happened for any products that it sells on Jet, but it has occurred on other marketplaces such as those operated by eBay and Sears Holdings Corp., he says. OrthoticShop.com brings in about $10 million in sales and generates about 60% of its revenue from its sales on Amazon and about 30% on its own website. OrthoticShop.com’s typical daily revenue from Jet has ranged from $1,000- to 1,800 since it began selling on the marketplace earlier this year.


On the other hand, Nathan Gordon, chief information officer of online retailer Christmas Central, says that combining the brands wouldn’t make much of a difference to the e-retailer because the marketplace is still small.

“So much of our marketplace sales comes from Wal-Mart and Amazon alone that if we stopped selling on Jet, our customers would just find our products somewhere else,” Gordon says.

Christmas Central sells its 109,000 SKUs on 11 marketplaces, including Wal-Mart and Jet, and about 75% of its revenue comes through those marketplaces. Wal-Mart’s marketplace sales have outpaced Christmas Central’s sales on Amazon thus far in 2016, Gordon says.

The e-retailer of seasonal merchandise, No. 534 in the Top 1000, says it hasn’t found that its customers differ across shopping portals.


“When we first started selling on Wal-Mart, they told us that the average order value will be lower than other sites. But we found that customers buy the same items they do on our site and Amazon. They were not afraid to spend $1,000 on Walmart.com,” Gordon says.

Wal-Mart’s marketplace has quickly increased the number of merchants in the last couple months, adding 100 new sellers in May and 150 merchants in June, with hundreds more expected to be added by the holidays, Seth Beal, the retailer’s senior vice president of global marketplace, told Internet Retailer last month. Wal-Mart offers 11 million products online and plans to add 1 million items per month to the assortment, primarily through its marketplace, Beal says.

In Internet Retailer’s newly released “Online Marketplaces: The shopping mall of the future” report, you can read more about how merchants are growing on marketplaces, which ones they’re selling on, key details of some of the largest marketplaces in the U.S. and what they’re doing to keep up with Amazon.