Walmart Shuttering Text-Driven Shopping Service Jetblack
Walmart’s New York City-based concierge shopping service Jetblack is shutting down and laying off most of its 350 staffers, according to reports on Thursday (Feb. 13).
The personal shopping and delivery service relied on text messages and promised speedy delivery. The service ends Feb. 21 and 293 of Jetblack’s employees will be laid off, a Walmart spokesperson told The Wall Street Journal.
Some Jetblack technology and design team employees will become part of Walmart’s wider customer organization, continuing to work out of New York, the spokesperson added.
Walmart tried to spin off the money-losing unit last year and also discussed possible investors including Microsoft, United Parcel Service and venture capital firms. Those talks have ended, people familiar with the situation said.
Jetblack was launched publicly in 2018 as part of an innovation arm at Walmart dubbed Store No. 8. Jetblack members paid $600 a year to order anything except fresh food by text message. Walmart aimed to use Jetblack’s human agents to train an artificial intelligence system.
The concierge shop-by-text service never made it out of New York and the division lost money. Last fall, its CEO Jenny Fleiss, who co-founded Rent the Runway, was replaced by Nate Faust, senior vice president of supply chain and logistics with Walmart’s eCommerce unit and co-founder of the Jet.com eCommerce site.
“We’ve learned a lot through Jet black, including how customers respond to the ability of ordering by text as well as the type of items they purchase through texting,” Scott Eckert, Walmart senior vice president and head of its Store No. 8 incubator, said in a company blog post. “We’re eager to apply these learnings from Jet black and leverage its core capabilities within Walmart.”
JetBlack customers spend about $1,500 per month, Walmart said in September. The orders aren’t cheap to fill, but Walmart said it has gathered a lot of useful data on people’s shopping preferences.