The past week brought news that Walmart and JD.com, China’s largest e-commerce company by revenue, are expanding the strategic partnership they formed last year. One element of this is the launch of a new shopping event—the JD-Walmart 8/8 omnichannel shopping festival—which will take place next week, on August 8. Here, we wrap up key points from the announcement.
Key Features of the Expanding Partnership
Inventory integration: Walmart and JD.com will roll out a jointly developed supply chain system to integrate inventory management. When an order is placed on JD.com, the system will analyze the inventory data of both companies and determine whether to deliver from the closest Walmart or the closest JD.com warehouse. Pilot projects will be launched in six cities.
Store and platform integration: JD.com recently set up its first JD Home store, which mainly sells electronic products, inside a Walmart store in Shenzhen. JD.com is also establishing pickup stations at Walmart stores. Meanwhile, Walmart has launched five online stores on JD platforms, and 134 Walmart stores have joined the JD Daojia rapid delivery platform.
Customer integration: The two companies seek to integrate their customer bases with the launch of the joint 8/8 omnichannel shopping festival. To support the launch, customers shopping at any of the 400-plus Walmart stores in China have been able to earn coupons for the 8/8 event by scanning a QR code in-store from July 20.
8/8: A “New Singles’ Day”
With promised savings, interaction and entertainment, 8/8 has more than an echo of Alibaba’s Singles’ Day shopping event. We have few details so far, even though it is less than a week away, but JD.com says that the event will offer savings across the various JD and Walmart channels as well as rewards for shopping on multiple channels. The event will feature a livestream broadcast from Walmart’s first US store and opportunities for shoppers to interact by sharing their experiences to earn rewards.
The companies say the 8/8 event will help Walmart reach 99% of the Chinese population covered by JD.com’s logistics network. JD.com is no doubt hoping that it reaps publicity and revenues akin to those generated by last year’s Singles’ Day, when Alibaba enjoyed a 24% uplift in gross merchandise volume, which reached $17.8 billion.
What Does It Mean?
We see these as takeaways from the partnership:
- International retailers continue to see greater opportunities in China when they collaborate with local players. In particular, the Walmart-JD.com partnership confirms the extent to which major retailers must focus on marketplace websites in order to cater to Chinese shoppers.
- The cooperation is further evidence of retailers blurring channels—including in terms of inventory management—to serve customer demand for convenience and immediacy.
- The 8/8 event suggests that entertainment has a role at the heart of retailing.
Other pieces you may find interesting include: Walmart and JD.com Expand Strategic Partnership in China, Takeaways from Walmart’s 47th Annual Shareholders’ Meeting, Takeaways from Walmart’s 47th Annual Shareholders’ Meeting