Inside a Jet.com warehouse in 2015.


Ben Fox Rubin/CNET

Walmart on Tuesday said it’s shutting down Jet.com, an e-commerce site that’s seen weakening online traffic for years.

The announcement was part of the world’s biggest retailer’s latest quarterly earnings report, in which it said its online sales surged 74% during the coronavirus pandemic. Walmart said it’s discontinuing Jet “due to continued strength of the Walmart.com brand” and said Jet had helped it build up its e-commerce business.

Walmart’s decision to shut down Jet may point to how hard it can be to succeed as a general-merchandise online retailer against the top three online retailers — Amazon, Walmart and eBay — especially if your parent company is focusing on building up its main site instead. These days, instead of competing against these major companies in a variety of categories, e-commerce startups are finding specific niches to grow into, such as Away for luggage, Rothy’s for shoes and Glossier for skincare. 

Jet, based in Hoboken, New Jersey, launched in the summer of 2015 as a rare, buzzy e-commerce startup in a market dominated by Amazon. It quickly raised $700 million, a huge amount for a new company, and offered creative new discounts to customers for the more stuff they purchased in one order and if they waived returns. The thinking was that if Jet could save money on shipping costs or fewer returns, it would share some of those savings with customers.

The startup was founded by Marc Lore, a prominent e-commerce veteran. In 2010, he sold his 5-year-old startup Quidsi, owner of Diapers.com and Soap.com, to Amazon for $545 million after Amazon initiated a price war against his company. He left Quidsi in 2013.


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Jet remained an independent company for a little over a year before Walmart, which was looking to bolster its online sales, scooped up the startup for $3.3 billion in September 2016. Lore was named Walmart’s new CEO of US e-commerce, a position he still holds today. The purchase was also part of a string of e-commerce buys from Walmart, which included ModCloth, Bonobos and Moosejaw.

About six months after the Walmart acquisition, Amazon shut down Quidsi, saying it struggled to make it profitable.

After bringing in many new e-commerce leaders, Walmart has seen success with its main Walmart.com site, which overtook eBay as the No. 2 online retailer in the US this year, according to eMarketer. But several of its smaller brands didn’t thrive, with Walmart selling ModCloth and cutting staff at Bonobos.

Jet’s online traffic has plummeted since the acquisition as Walmart has focused more on expanding Walmart.com, Marketplace Pulse reported. Jet traffic in December 2016 was 33 million visits, but that number dropped to 1.4 million by December 2019.

Jet attempted to rebrand itself in late 2018 as a site for urban dwellers, with a refreshed site and improved grocery service, but it remained difficult to stand out against much bigger rivals.

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