(Bloomberg)—Jetblack is going black.
Walmart Inc.’s Jetblack, a personal-shopping service for busy urban families, will cease operations Feb. 21, according to a company spokesman. The brainchild of Walmart’s online chief Marc Lore, Jetblack will be integrated into the parent company’s operations and its technology applied to other parts of the retailer. Nearly 300 employees will be let go as part of the move, with 58 staying on with Walmart, the spokesman said.
The decision comes after discussions to sell the money-losing unit fizzled, a person familiar with the talks said.
The move was not much of a surprise, as Walmart has said very little about Jetblack in recent months amid a broader restructuring of its U.S. ecommerce business, which is growing but remains unprofitable. Jetblack was the first business to emerge from Walmart’s Store No. 8 technology incubator, which has also undergone changes as its two co-leaders have departed. Walmart replaced Jetblack’s CEO in October.
“When we launched Jetblack, part of the initiative was to start testing and building technology with the intent that it could be used in other ways, including applying it to other parts of our business,” Scott Eckert, senior vice president of next-generation retail and the head of Store No. 8, said in an internal company memo. Advances in text-based shopping and voice ordering “will be an important way Walmart serves customers in the future.”
The news was first reported by The Wall Street Journal.
Jetblack’s customers paid $50 a month for the service, which allowed them to text their requests for, say, a child’s birthday present, which would elicit a range of ideas that shoppers could choose from. Personal shoppers roving around Manhattan retailers like Sephora and Saks would then purchase the item and deliver it the same day—gift wrapping included.
Jetblack once claimed it had “thousands of people” on its waiting list, but the service didn’t make much sense beyond doormen-staffed apartment buildings.
The 293 impacted employees will be offered severance if eligible, while the remaining 58 workers will form a New York-based “Conversational Commerce” team housed inside the retailer’s customer-focused division led by chief customer officer Janey Whiteside.
Walmart is No. 3 in the 2019 Digital Commerce 360 Top 500.