Walmart made the headlines when it acquired Jet.com for $3.3 billion last year. It is still unclear what is the strategy for owning two online platforms Walmart.com and Jet.com, but if anything, getting the founder Marc Lore, and his team, to rejuvenate the e-commerce department was worth it. Talent is key, and previously it didn't look like Walmart was able to attract it.

Since then they made more acquisitions in the form of Hayneedle for $90 million, ShoeBuy for $70 million, Moosejaw for $51 million, ModCloth for $75 million, and most recently Bonobos for $310 million. However as Shelly Banjo wrote in Walmart's Bargain-Bin E-Commerce Plan at Bloomberg:

"Acquisition headlines at the very least create the perception Walmart intends to catch up to Amazon. But with Walmart reverting to its old strategy of hoping small investments will yield big changes, it's hard to see why the outcome will be all that different this time around."

Bonobos and ModCloth are both to be sold through Jet.com. But overall, in terms of M&A strategy, there isn't much beyond Walmart acquiring brands to strengthen their catalog.

Which is a solid strategy, but it won't return explosive growth everyone is looking for.

In The Marketplace Is Probably a Distraction for Walmart E-Commerce we wrote that the Walmart Marketplace launched in 2009 was a passive attempt to catch the passing e-commerce train. There were expectations it would make their online sales growth, but like all passive attempts it didn't. That's why Jet.com acquisition was a pivotal event as Walmart realized it needs to do more itself, not just expect the marketplace to solve their e-commerce struggles.

What does Netflix have to do with any of this?

Amazon is spending billions of dollars every year on video not because it wants to be come the next HBO. Amazon is building the video streaming service because not only it is an additional incentive to join Prime, and thus shop more on Amazon.com, but also because it captures attention.

Jim Freeman, vice president of digital video at Amazon, said this, key phrase being "so our customers could stay with us":

"We knew digital was coming. We felt the need to build that digital service, so our customers could stay with us and continue to use Amazon as a retailer for entertainment. That was the genesis for the original video effort."

Most shopping today is done through search. The search bar on Amazon.com is the gateway, and thus brands spend a lot of effort on efforts like keywords optimization. Online shopping is simply a more efficient way to shop. But it doesn't have to be just about efficiency. In the path from discovery to purchase Amazon captures the purchase part really well, but discovery happens elsewhere, most recently on social networks.

Thus by expanding their video product, and by selling tens of millions of Amazon Echo devices, Amazon is growing in discovery too. In April Amazon bought rights to stream 10 Thursday night NFL games for $50 million. Stream for free to Prime members. Because the value for Amazon is that customers spend time on Amazon, capturing the previously mentioned attention, and the many possibilities it gets to offer something more. Both in terms of ads, and products.

In China e-commerce companies are horizontally integrated with media platforms, and social networks. They own discovery, and purchasing. This means that there is no breakage between a customer discovering a product, and them being able to purchase it. In most other countries a customer has to go through disconnected platforms to achieve the same thing. It's not to say that the Chinese monopoly model is better, but there is more innovation there.

The challenge for Amazon is how to make their online presence, and mobile apps something people open just to browse. In the same way people go to shopping malls just to walk around. Because if you can build something like that, which in China Alibaba has done with the Taobao mobile app for example, the shopping happens not just when someone needs something.

Thus considering all this, Amazon Video looks less so like Amazon going after HBO, and more so about them trying to capture attention when customers are not actively shopping. It's a much bigger game than chasing Oscars. It's a game where the end result is people spending more time on Amazon properties, and in turn shopping more.

If Walmart wants to be relevant in e-commerce 10 or 20 years from now it needs to the same. Acquisitions, and internal work done to expand the catalog are all solid work, but it is not taking, and rethinking what e-commerce shopping will look like in the future. Walmart will continue to grow, reaching $16 billion US sales online next year, but not because of innovation.

It would be interesting to ask how many people inside Walmart, and Amazon have used, and understand Snapchat. And by induction how many understand the people who do. Because the new generation, for whom Snapchat is the most used app, will be shopping differently. There is not going be innovation in e-commerce if the people building it don't understand their users.

At $86.6 billion market cap Netflix today is beyond Walmart's budget. But picking up ShoeBuy for $70 million is, as Shelly Banjo of Bloomberg put it, hoping small investments will yield big changes.

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