Wal-Mart to Invest $50M in Chinese Online Grocer New Dada
Wal-Mart Stores Inc. said on Friday it would invest $50 million in Chinese online grocery and delivery firm New Dada. The move extends Wal-Mart's partnerships with local Chinese online players to help boost sales in the world's second-largest economy. For example, Wal-Mart earlier this year sold its own online platform, Yihaodian, in exchange for a stake in local Chinese e-commerce giant JD.com Inc. (New Dada is a joint venture part-owned by JD.com.) The investment in New Dada will help Wal-Mart target Chinese shoppers with faster delivery times in a popular but competitive online grocery market. New Dada has over 25 million registered customers and delivers in over 300 Chinese cities.
Total Retail's Take: Wal-Mart is clearly betting on China, and by cementing its relationship with JD.com, it's also taking aim at JD.com's biggest competitor, Alibaba. Not only is China one of the world's fastest-growing e-commerce markets, but online grocery is a category that appears poised for growth. Wal-Mart hopes this combination will pay dividends.