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Introduction to Business 2e

Critical Thinking Case

Introduction to Business 2eCritical Thinking Case

Critical Thinking Case

Walmart Gets Serious about E-Commerce

As the world’s largest retailer by total sales, Walmart has built thousands of brick-and-mortar stores in the United States, Mexico, and elsewhere. Although a success story when it comes to traditional retail locations, Walmart has struggled with its e-commerce efforts, with online sales accounting for nearly 20 percent of the company’s $680 billion in annual sales by 2025. The company has tried several different e-commerce strategies in the past, but none of them was an overwhelming success. Some company insiders objected to the pricing strategy used for online purchases; they were fearful that Walmart’s lower prices online would take customers (and sales) away from the retail locations.

Doug McMillon, Walmart’s CEO since 2014, believed a significant change was needed in the company’s e-commerce business. Between 2014 and 2016, Walmart spent billions to acquire several online companies to expand its e-commerce business in an effort to take a small bite out of retail giant Amazon’s success. In 2016, Walmart purchased Jet.com, an e-commerce site that sells a little bit of everything (books, clothing, electronics, etc.) at discount prices. The goal was to use the acquisition to fuel Walmart's e-commerce efforts. Four years after the acquisition, Walmart made the decision to discontinue the Jet.com brand and website. Walmart's leadership utilized the expertise in e-commerce from Jet.com to boost their own efforts in building Walmart's market share in online sales. Additionally, Walmart worked to identify other established online companies to add to their e-commerce profile.

First Walmart purchased footwear e-tailer ShoeBuy for $70 million in January 2017. The following month, Walmart bought outdoor specialty retailer Moosejaw for $51 million (sold to Dicks Sporting Goods in 2023). Then in March, Walmart paid $75 million for ModCloth, an eclectic shopping site for women’s fashions (sold to Go Global Retail in 2019). Walmart also purchased Bonobos, a hip fashion retailer geared toward millennial men, and then later sold the company to WHP Global and Express in 2023.

Reaction to the acquisitions has been mixed, depending on whom you ask. Retail analysts applaud the company’s radical move, pointing out that several well-known traditional retailers have closed their doors or filed bankruptcy because they failed to take part in the e-commerce revolution. However, McMillon’s decision to allow the online retailers to operate independently may help retain loyal customers. The focus on e-commerce may also prompt in-store customers to take advantage of the expanded offerings available through Walmart.com.

Critical Thinking Questions
  1. What are some advantages of Walmart purchasing established web businesses?
  2. What impact has Walmart’s acquisition of nontraditional retailers had on the shopping habits of Walmart’s customers?
  3. How did the aggressive e-commerce plan implemented by Walmart affect operations at its retail locations?

Sources: Brad Stone and Matthew Boyle, “Amazon Won’t Know What Hit ’Em!” Bloomberg Businessweek, https://www.bloomberg.com, May 8–May 14, 2017; “What an Acquisition of Bonobos Would Signal About Wal-Mart’s Strategy,” Forbes, https://www.forbes.com, May 9, 2017; “Walmart Acquires Niche Online Retailers, to the Dismay of Hipsters,” Denver Post, https://www.denverpost.com, March 24, 2017; Alana Abramson, “Walmart Acquires Online Women’s Retailer ModCloth,” Fortune, https://fortune.com, March 17, 2017; Phil Wahba, “Walmart’s 29% Online Holiday Season Growth Sends Shares Jumping,” Fortune, https://fortune.com, February 21, 2017; Laura Heller, “Take That Amazon: Walmart Buys Moosejaw for $51 Million,” Forbes, https://www.forbes.com, February 15, 2017; “Walmart Acquires ShoeBuy for $70 Million,” Business Insider, https://www.businessinsider.com, January 6, 2017; "Walmart Inc. (WMT) Revenue," https://wallstreetnumbers.com, accessed March 5, 2026; "Wal-Mart Expands Online Reach with ShoeBuy Acquisition," Associated Press, https://apnews.com, January 5, 2017; Joan Verdon, "Reborn at Age 18: Modcloth’s New Owners Give the Vintage-Inspired Clothing Brand New Tools for Growth," CO—, https://www.uschamber.com, August 10, 2020; Melissa Repko, "Walmart Winds Down Jet.com Four Years after $3.3 Billion Acquisition of E-Commerce Company," CNBC, https://cnbc.com, May 19, 2020; Julia Waldow, "‘Not a Core Competency:’ Why Moosejaw No Longer Fits in Walmart’s Portfolio," Modern Retail Daily, https://www.modernretail.co, February 27, 2023; Gabrielle Fonrouge, "Walmart Sells Bonobos to WHP Global and Express in $75 Million Deal," CNBC, https://www.cnbc.com, April 13, 2023; Christian Stadler, "What Is The Secret To Walmart’s Success?" Forbes, https://www.forbes.com, May 24, 2024; "Walmart US Turns Ecommerce Profitable for the First Time," Ecommerce North America, https://www.ecommercenorthamerica.org, April 14, 2025.

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