Google to Invest $550 Million in China's JD.com
CHINA AND THE WORLD - Like the saying goes, it takes two to tango—or was that mango? Two companies are teaming up for an unlikely partnership to battle the constant threat that Amazon has become for the industry. Google is investing $550 million in Chinese online retailer JD.com.
“This partnership with Google opens up a broad range of possibilities to offer a superior retail experience to consumers throughout the world,” JD.com’s Chief Strategy Officer Jianwen Liao said. “This marks an important step in the process of modernizing global retail. As we celebrate our June 18 anniversary sale, this partnership opens a new chapter in our history.”
Retail solutions will be developed as the partnership takes shape, which will tend to Southeast Asia, U.S., and Europe retailers. Fusing JD’s supply chain and logistics expertise with Google’s technology expertise, the alignment seeks to create the next generation of retail infrastructure solutions that will be helpful and personalized for customers’ shopping experiences.
The Wall Street Journal posits that the the move will expand both companies’ retailing presence, and with this endeavor, JD will sell products on Google’s Google Shopping feature. In addition, this step will strengthen JD’s stance in the U.S. and Europe, as it moves beyond its competition in China.
"We are excited to partner with JD.com and explore new solutions for retail ecosystems around the world to enable helpful, personalized, and frictionless shopping experiences that give consumers the power to shop wherever and however they want,” Google Chief Business Officer Philipp Schindler said.
The Google Shopping capabilities permits retailers to show their ads for products above Google’s search results’ blue links. Further, Google has made other moves recently, including voice-enabled smart speakers and convenient home grocery delivery, according to the news outlet.
Walmart and Tencent Holdings are other shareholders that Google will now be joining. The latter of the three will receive 27,106,948 newly issued JD.com Class A ordinary shares. The shares are issued at $20.29 per share, which equals out to about $40.58 per ADS, based on the volume-weighted average trading price over the prior trading days, the press release shares.
Will Google’s partnership with JD boost interest in other tech companies stepping into the grocery domain, and, if so, will that interest shift the trajectory of business moving forward?AndNowUKnow will keep you updated with the latest happenings in our industry.