Wal-Mart Stores, Inc. announced today that it has finalized an agreement to purchase discount ecommerce site Jet.com for roughly $3 billion in cash and $300 million in Walmart shares.
Jet.com launched in 2015 with the promise, “Prices Drop As You Shop.” Using what the company calls “real-time pricing algorithms,” customers can save money by choosing to purchase items located in the same distribution center, opt out of the free return policy, or pay with debit cards. Within a single year, Jet.com reached $1 billion in Gross Merchandise Value (GMV) and was growing by more than 400,000 new users each month.
According to Walmart’s official announcement, the acquisition of Jet.com aims to expand the retail giant’s existing ecommerce presence, currently limited to its online site and mobile app. “We’re looking for ways to lower prices, broaden our assortment and offer the simplest, easiest shopping experience because that’s what our customers want,” said Doug McMillon, president and CEO, Wal-Mart Stores, Inc., in the announcement. “We believe the acquisition of Jet accelerates our progress across these priorities.”
Jet.com was founded by Marc Lore, Mike Hanrahan and Nate Faust in 2013. In 2005, Lore co-founded Quidsi, the parent company of retailer sites Diapers.com, Soap.com and Wag.com, which was purchased by Amazon in 2010.