Wal-Mart Stores Inc. continued to expand its e-commerce presence Thursday, announcing that Jet.com has acquired an online footwear, clothing and accessories company.
The retailer purchased ShoeBuy from IAC, an American media and Internet company, for about $70 million in a deal that closed Dec. 30. The Boston-based e-commerce company will continue to operate as a stand-alone and complementary site to Walmart.com and Jet.com.
Wal-Mart purchased Jet.com for $3.3 billion last year and is operating the e-commerce site and Walmart.com as separate entities. The acquisition also included Hayneedle, an Omaha, Neb., home furnishings company that Jet.com had purchased for about $90 million in early 2016.
ShoeBuy -- which was founded in 1999 -- carries more than 800 brands and more than 1 million items, including footwear, clothing and accessories. Some of the brands available on its site include Adidas, Puma, Uggs and Polo Ralph Lauren.
"Jet will gain the experience of a well-established e-commerce player in the footwear industry, who has transformed the online shopping experience for millions of customers," Wal-Mart said in its announcement. "ShoeBuy brings access to a large assortment of products, strong industry relationships, and rich content that will further enhance our customer experience."
Brian Yarbrough, a retail analyst with Edward Jones, said the move continues Wal-Mart's aggressive plan to gain online market share. He added that Wal-Mart's acquisition of ShoeBuy is similar to an acquisition by e-commerce giant Amazon.com, which purchased online shoe retailer Zappos.com Inc. for about $850 million in 2009.
But Yarbrough said he doesn't anticipate Wal-Mart's acquisition to make a significant impact.
"I don't know if it will ever be meaningful when you think about the sheer size of Wal-Mart's sales," Yarbrough said of the addition. "But I think it goes with the fact they are obviously full speed ahead online, and I wouldn't be surprised to see them do more deals like this as they continue."
Tom Caporaso, chief executive officer of e-commerce solution provider Clarus Commerce, said Wal-Mart has been aggressive because it has to be to meet the changing behaviors of shoppers, who continue to spend more online each year.
ShoeBuy "fills a need" for the retailer as it tries to gain online market share in important categories like footwear, Caporaso said.
"The ShoeBuy purchase, along with what Jet did with Hayneedle, is [Wal-Mart] buying categories, pieces of the puzzle where they might not have deep merchandise or distribution," he said.
Like Jet.com and Hayneedle, ShoeBuy will keep its identity under its new parent company. Chief Executive Officer Mike Sorabella, his executive team and more than 200 employees will continue to be based in Boston.
Carol Spieckerman, a retail analyst and president of Spieckerman Retail, said the purchase is more evidence that Wal-Mart is taking a portfolio approach to its e-commerce business. Spieckerman said ShoeBuy will continue to give the retailer "depth of assortment, brand relationships and overall relevance in key categories."
"Amazon has also shown a propensity for gobbling up digital category players like diapers.com, but mostly with a goal of taking out competitors rather than building true category strength," Spieckerman said in an email. "Wal-Mart is taking the latter approach and it will be interesting to see how it strikes a balance between synergizing its growing number of digital holdings and maintaining independence and differentiation between them."
Business on 01/06/2017
Print Headline: Jet.com acquires footwear e-retailer