Walmart’s Store No. 8 innovation incubator nurtures new technologies and ideas geared toward propelling the brick-and-mortar-based retailer into the digital-first era. Jetblack, the first new business to emerge from the future-forward accelerator, offers a personal shopping service for affluent Manhattanites and Brooklynites who wouldn’t think twice about paying $50 monthly to get their last-minute requests delivered same-day.
It’s perhaps the biggest move yet in Walmart’s all-out war against Amazon, which has virtually set the bar for e-commerce and convenience through its membership-based Prime ecosystem of services, including Prime Now for two-hour deliveries and the grocery-focused Prime Fresh option. Last year, Amazon launched a discounted version of Prime targeting low-income consumers—a demographic traditionally associated with Walmart—as it neared saturation among high-income households. More than 82 percent of households pulling in $112,000 or more annually hold Prime memberships, according to data from Piper Jaffray.
Jenny Fleiss, who co-founded Rent the Runway and runs the Code 8 firm within store No. 8, is in charge of Jetblack, which is operating in invitation-only mode for well-heeled folks who live in select Manhattan and Brooklyn doorman buildings—secure enough to receive deliveries 24/7—following a beta test in Manhattan earlier this year. The service revolves around the convenience of text messaging; members simply dash off a text to Jetblack with their request, receive relevant product recommendations, select the most desirable option and get their order delivered free of charge same (or next) day. There’s no spending threshold users must meet, and Jetblack staff will pick up any items members want to return.
“With Jetblack, we have created an entirely new concept that enables consumers to get exactly what they need through the convenience of text messaging and the freedom of a nearly unlimited product catalogue,” Fleiss said. “We are confident this service will make shopping frictionless, more personalized and delightful.”
Industry pundits have predicted a shift toward text message- and chat-based conversational commerce. Business Insider noted that the four largest messaging apps have 4.1 billion active monthly users, and the daily time U.S. users spent in these apps increased 15.2% from eight minutes to 10 minutes year over year, according to eMarketer research from 2017. On the back end, Jetblack combines artificial intelligence and human insights through “the expertise of professional buyers” to deliver on-target product recommendations across categories including apparel, health and wellness, parenting and home goods.
Walmart said in a statement that Jetblack—whose name, website design and color scheme seem to be born from Jet.com—targets “time-strapped urban parents,” though the messaging on the Jetblack website is geared toward “busy moms,” in particular. The retailer thinks the service will resonate with someone who might need last-minute birthday gifts, for example, which will arrive at their doorstep wrapped and with a card. Jetblack fulfills from both Walmart’s and Jet.com’s own inventory, as well as local brands and specialty stores.
Jennifer Sherman, SVP of product and strategy for omnichannel platform provider Kibo, said Jetblack marks one of the most high-profile forays into what’s been dubbed “headless commerce,” an approach to web development and architecture that “decouples” the consumer-facing front end form back end systems like content management engines. It’s growing in popularity as retailers seek flexible and cost-friendly ways of developing e-commerce platforms serving increasingly complex paths to purchase.
“Headless commerce is an interesting space, and merchants have yet to fully crack the nut on meeting consumers where they are, whether or not it is on their primary e-commerce site,” Sherman said. “Walmart has always successfully targeted and sold to a value-focused shopper, and with a $50/month price tag and brands like Saks and Pottery Barn onboard, Walmart is taking a step to appeal to a different demographic that focuses on more high-end goods, as the service won’t be offered for replenishment style shopping given that grocery isn’t included.”
Sherman called out Jetblack’s technology model, which leverages a team of personal shoppers in lieu of a machine learning engine. “This tells us that Walmart is placing more value on its associates rather than on personalization technologies and use of machine learning to automate what should be some straightforward capabilities,” she said.
“It will be interesting to see how Walmart will balance its use of technology and associates moving forward with services like this one and additional initiatives in the future,” Sherman concluded.