As Walmart’s main website has grown, Jet has languished, suffering declines in traffic and sales even as it added brands like Nike and Apple and rolled out a fresh-food offering.

(Bloomberg)—Walmart Inc. will fully integrate all Jet.com employees into the larger company and shrink the unit’s management team nearly three years after buying the ecommerce site.

The changes, outlined in a memo Wednesday from Jet co-founder Marc Lore, include the departure of Jet president Simon Belsham, who will seek another opportunity inside or outside the company after a transition period that ends in early August. After that, Walmart senior vice president Kieran Shanahan will take over day-to-day responsibilities of the Hoboken, New Jersey-based unit, Lore said in the memo.

Since Walmart acquired Jet for $3.3 billion in 2016, the world’s largest retailer has granted Lore’s former startup and its employees—so-called “Jetheads”—a degree of autonomy that was unusual in Walmart’s rigid corporate structure. But as Walmart’s main website has grown, reaching about $20 billion in sales last year, Jet has languished, suffering declines in traffic and sales even as it added brands like Nike and Apple and rolled out a fresh-food offering.

Walmart will now merge Jet’s marketing, analytics and product teams within Walmart, and fully integrate its technology and retail teams, which had been partially meshed. It’s not clear how much smaller Jet’s overall workforce will be after the changes. The remaining Jet-focused staffers will work under Shanahan, who previously ran the e-commerce operations at Asda, Walmart’s U.K. arm, whose online business has served as a model for Walmart’s.

Most of Jet’s original leaders are no longer directly involved with the unit. Lore now runs all of Walmart’s U.S. online operations, while his fellow co-founders, Mike Hanrahan and Nathan Faust, have transitioned into other senior roles inside Walmart. Former president Liza Landsman left last year, while several other managers have moved on to launch their own startups.

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“They probably want the talent they have to focus on the Walmart brand,” said Sucharita Kodali, an analyst at Forrester Research. “If they keep the Jet brand alive, it would make sense to keep it for experiments.”

Lore thinks otherwise. “Jet continues to be a very valuable brand to us, and it is playing a specific role in helping Walmart reach urban customers,” Lore said in the memo. Jet will look to reach more of them in the coming months, as it’s looking for new cities to expand into.

“More to come on that,” Lore said.

Walmart is No. 3 in the Internet Retailer 2019 Top 500.

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