The curious case of Walmart and its venture into creating a stable of hot startup DTC brands has come to a close, with the 2023 sales of Moosejaw, Bonobos and Eloquii in quick succession. So it’s a fitting time to take a look at the six-year-plus journey that began with the massive $3.3 billion acquisition of Jet.com in 2016.
While part of it may look ugly on the balance sheet, especially Jet.com and the 76% discount to Bonobos’ $310 million price tag in 2017, Walmart gained a good deal in terms of market intelligence, entrepreneurial innovation and insights into younger shoppers and fashion.
For one proof point, consider that Walmart’s ecommerce penetration more than doubled in that time, from 5% to about 13% or $80 billion as of Q4. As Adam Sandler would say, not too shabby. Being left in Amazon’s dust was a real fear in 2016.
Raj Konanahalli, a partner and managing director of business advisory firm AlixPartners, said Walmart saw the spree, overseen by former head of ecommerce Marc Lore, as a way to grow its digital presence, compete with Amazon and upgrade its branding. Having leveraged all the value from ownership, it was time to move on. Konanahalli shares more of his thoughts in our latest MCM CommerceChat podcast below.