In Strategic Acquisitions: Amazon vs Walmart (2017), I described how both retail giants were investing in digital capabilities in order to give an omnichannel customer experience while growing (keep growing and adapting) a successfull and sustainable business.
Today, retail is more dynamic than ever due to the impact of technology and new types of communication (e.g. social media). The marketing funnel has changed, and the customer journey is impacted by a new brand-consumer relationship that multiplies touchpoints and puts the customer and the experience at the center. New retail has given rise to new business models, new distribution channels, new store formats, new marketing tools… The result is a Revolution that is reshaping operations in every industry (Fashion Goes Tech. A. Segura. 2021)
Amazon and Walmart, the kings of online and offline retail have invested in the other side of the coin (physical vs digital), building an omnichannel ecosystem. Many of the acquisitions are tech startups from Grocery, Media & Entertainment, Cloud Services, Financial Services, Artificial Intelligence, Logistics, even pure-players or retailers.
Both giants share something in common: investments in high-tech startups. Technology to empower the phygital business. I see growth as digital marketing: you need organic and inorganic strategies. M&A is a lever to accelerate digital transformation and this is the reason I’m illustrating Walmart’s adaption to the digital era through its latest acquisitions (in this case, inorganic strategies are acquisitions).
But Walmart is not only betting on acquisitions and is launching multiple initiatives too to reach their business, social and environmental targets. Walmart is empowering its business ecosystem through initiatives that focus on omnichannel, connecting supplier, brands, employees and customers, while enhancing customer experience. For example, Walmart Connect (formerly Walmart Media Group); Gatik Go Driverless (self-driving car pilot); new pet care services; pop-up distribution centers (eDCs); new checkout experience; piloting drone delivery; partnership with TikTok; launch of Walmart+, amongst others.
Since my post in 2017, Walmart acquired or invested in the following companies (not exhaustive):
- Moosejaw is an online retailer of jackets, clothing, footwear, tents, backpacks and travel products for men, women, kids and babies.
- Bonobos is an online apparel marketplace that designs and sells shirts, shorts, jeans, sweaters, blazers, golf pants, jackets and coats.
- Parcel is a provider of last mile delivery services for online retailers.
- Spatialand is an online platform that allows businesses to create virtual reality contents for gaming and entertainment sectors.
- Flipkart is an E-commerce portal that sells apparel, footwear, smartphones, home appliances, furniture and computer accessories.
- Cornershop is an on-demand delivery platform that enables users to order and buy groceries from local supermarkets.
- Bare Necessities an online retailer of intimate apparel and underwear for women and men.
- Eloquii is a designer, manufacturer and online retailer of apparels, shoes and accessories for women.
- Art.com is an online retailer that specializes in providing wall art products.
- Aspectiva is a provider of AI-based customer behavior analytics solutions for the retail sector.
- Polymorph Labs is a monetization platform that offers unified reporting, self-service booking tools and channel management solutions for publishers.
- Zeekit: Combining fashion and technology, Zeekit has developed a dynamic virtual fitting room, giving every person the chance to see themselves in any item of clothing found on-line.
- Rakuten: Walmart invested $153 Million to accelerate the growth of Rakuten’s ecosystem in Japan and globally.
- Fintech startup: Walmart announced the creation of a new fintech startup designed to develop and offer modern, innovative and affordable financial solutions. The new company is a strategic partnership with leading fintech investment firm Ribbit Capital.
- MeMD: Founded in 2010 by an ER physician and entrepreneur, MeMD originated as a telehealth company that aimed to provide individuals and businesses with on-demand, online care for common illnesses and injuries.
Walmart’s Q4 and 2021 annual review reported an annual revenue of nearly $560 billion and $35 billion of growth; $40 billion of growth in constant currency. Walmart continues to build the next generation business model, investing in automation to fuel future sales and earnings growth. FY22 capital investments are expected to be nearly $14 billion to build supply chain capacity and automation to stay ahead of demand, improve the customer experience and increase productivity. U.S. comp sales increased 8.6% with strength across most key categories and U.S. eCommerce sales increased 69% with strong results across all channels.