Wal-Mart (NYSE: WMT) has booked a massive 63% uptick in US online sales for its 1Q 2018 fiscal year, along with a 69% increase in gross merchandise volume. The company can thank its recent acquisitions for those figures, chief among them last summer’s blockbuster deal for ecommerce platform Jet.com for $3.3 billion—a transaction that also represented a massive win for the target’s VC backers.
But that wasn’t the only recent ecommerce pickup for the giant retailer. Of Wal-Mart’s last 9 completed M&A deals, three have been in internet retail, and some of the acquisitions represent the building blocks of a larger ecommerce strategy: Wal-Mart has added companies up the supply chain in commercial transportation, logistics and wholesale, according to the PitchBook Platform.
On a broader level, dealmaking in ecommerce by companies based in North America and Europe remained hot through last year after it jumped 43% YoY in 2014.
Completed corporate acquisitions in ecommerce since 2010
For its part, Wal-Mart is engaged in a prolonged fight for market share with Amazon. However, retailers’ attempts to compete with the likes of Amazon and eBay alone cannot account for the sustained increases in ecommerce M&A.
Rather, the wider shift in consumer habits away from shopping at brick-and-mortar stores has prompted retailers across various industries to make a concerted push into this space. Not only have companies spent billions of dollars picking up ecommerce targets, they have also started building out their own offerings. To that end, some have also leveraged recent acquisitions as platforms for buying smaller rivals that might make a good fit. Case in point: Jet.com’s March announcement that it had agreed to acquire women’s fashion retailer ModCloth.
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