October 20, 2017

HMM: Wal-Mart’s Answer to Amazon? Its Own Web Mall.

The world’s biggest retailer is near a deal with Lord & Taylor that would give the department store dedicated space on walmart.com, according to a person familiar with the matter. Such an agreement would be the first step in creating an online mall that shoppers could access from Wal-Mart’s website, this person said.

Additional brands that could eventually be included in the project are men’s clothing company Bonobos and online retailer Jet.com, both of which are owned by Wal-Mart, as well as other traditional chains, this person said. Financial terms of the potential Lord & Taylor partnership couldn’t be learned.

Wal-Mart is seeking to build an anti-Amazon coalition as it begins to ramp up e-commerce sales after several years of sluggish growth. Last year Wal-Mart bought Jet, placing its founder Marc Lore at the head of U.S. e-commerce operations. Then Wal-Mart made a series of smaller e-commerce purchases including Moosejaw, Bonobos and ShoeBuy, both to expand its online selection and gain give it access to brands built online, executives have told investors.

Now Wal-Mart aims to make walmart.com more attractive to premium brands and high-income shoppers, an area Amazon has also pursued in recent years.

Higher-end brands have been reluctant to work with Amazon because of its reputation as a discount e-outlet. So why would a higher-end department store like Lord & Taylor partner with Walmart? Best guess: Amazon has grown so large that everyone else is frightened of being consumed by Bezos’s beast.

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