Walmart has announced plans to buy e-commerce site Jet.com for US$3.3 billion in order to boost its online retail sales. Walmart has been struggling to compete against online retailers like Amazon that is pulling ahead of other retailers in e-commerce.
Jet.com was launched by Marc Lore in July last year. Its initial strategy was to offer large discounts and the lowest prices on items based on a pricing formula that took into account factors such as basket size for an annual $50 fee.
Walmart and Jet.com will remain separate companies, but will co-operate over technology.
Wal-Mart’s online business posted its slowest growth in a year in the latest quarter. Sales in the unit were $13.7 billion in 2015.
Jet.com started off using a pricing strategy that offered discounts for placing larger orders and charged a $50 subscription fee. The subscription model was dropped after three months