Walmart overhauls Jet.com as online business fails to deliver results

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Walmart overhauls Jet.com as online business fails to deliver results

FILE PHOTO: Walmart’s logo is seen outside one of the stores in Chicago, Illinois, U.S., November 20, 2018. REUTERS/Kamil Krzaczynski

WASHINGTON (Reuters) – Walmart Inc on Wednesday announced a sweeping overhaul at Jet.com, an e-commerce retailer it acquired in 2016 for $3.3 billion, and said it will eliminate the online business’s president.

Walmart said it will integrate Jet.com’s retail, technology, marketing, analytics and product teams with its own e-commerce business and current president of Jet, Simon Belsham, will leave in early August.

Walmart’s move reduces the scope and importance of Jet.com in its overall U.S. e-commerce ambitions of taking on Amazon.com Inc and growing its online revenue in the United States, according to interviews with six vendors, two consultants and three Walmart employees.

Jet.com, which was expected to boost Walmart’s reach particularly with city dwellers and millennial shoppers, has not lived up to the retailer’s expectations of becoming a driver for online grocery sales and growing market share in urban areas, the sources added.

The retailer has previously said it expects losses from its online business, including Jet.com, to increase this year, without giving additional details.

Going forward, Kieran Shanahan, who oversees Walmart’s food, consumables, health and wellness categories, will be responsible for Jet.com’s strategy and management, in addition to his current role.

Reporting by Nandita Bose in Washington; Editing by Lisa Shumaker