According to JD.com’s International President, Winston Cheng, their partnership with the American retail giant Wal-Mart is proving so successful it is leaving competitors such as Amazon in its wake. Talking to CNBC, he said:
“We’re integrating with Wal-Mart in a much tighter partnership, which … potentially, Amazon might do with Whole Foods. But for us, we’ve already started on this strategy over a year ago with Wal-Mart.”
Currently, JD.com is China’s second largest ecommerce player, behind the behemoth that is Alibaba. Since 2016, when it began hosting Wal-Mart’s ecommerce offerings on its platform, both companies have been working together to integrate their platforms, inventories and customer resources in China.
Now, Chinese shoppers are able to purchase over 1700 US made products from Wal-Mart through JD.com’s online platform. According to Cheng, the partnership is a strategic one and one that brings about significant benefits to both JD.com and Wal-Mart.
“We bring, clearly, the online traffic to Wal-Mart,” said Cheng. Furthermore, Wal-Mart is “offering space in their stores for our inventory … so we have expanded our fulfillment capabilities as a result of that as well,” he said, adding that the company also looks forward to selling “a tremendous number of quality imported products not previously widely available in China through Walmart and Sam’s Club.”
However, JD.com’s partnership with Wal-Mart is not its only one. At the end of 2014, Chinese tech firm Tencent went into partnership with JD.com, crucially giving JD.com a headline slot on the WeChat mobile app, owned by Tencent.
“With the Tencent partnership, we bring a lot of the mobile traffic also to our customers,” Cheng said. “And with the Wal-Mart partnership, it’s a fully-integrated online traffic to online e-commerce to offline retail strategy,” he added.
However, whilst JD.com’s International President Winston Cheng says that they are leaving competitors like Amazon in their wake when combining ecommerce and bricks and mortar retail, it would be foolish for anyone to write Amazon off or indeed Alibaba.
Both of these companies operate a ruthless efficiency and whilst JD.com may believe that they have the advantage now, the innovation and drive that both Alibaba and Amazon display means that this advantage could be overtaken at any time. Amazon have been slowly moving into the bricks and mortar market whilst Alibaba has been a bit more adventurous, launching more of its Hema supermarkets that combine online and offline shopping. The battle for the omnichannel is heating up, and it’s unclear as yet who the winner will be.