Walmart shares rise, grocer agrees new eCommerce JV with Japan's Rakuten

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Walmart Stores, Inc.is joining with Japan's largest e-commerce retailer Rakuten to launch an online grocery delivery service in Japan.

Wal-Mart has expanded its USA e-commerce sales in recent quarters after rolling out online grocery services and buying a string of online startups, including Jet.com Inc.in 2016, placing the site's founder Marc Lore at the head of US e-commerce operations.

"Working with Rakuten Kobo enables us to quickly and efficiently launch a full e-book and audiobook catalog on Walmart.com to provide our customers with additional choices alongside our assortment of physical books", Scott Hilton, chief revenue officer at Walmart's USA e-commerce division, wrote in a company blog post.

Wal-Mart Stores Inc has forged another alliance to counter Amazon.com Inc, partnering with Japan's Rakuten Inc to sell e-books in the USA and improve its online grocery business in the Asian nation.

The partnership also includes a revamp of Walmart's online grocery service in Japan that is to roll out in the third quarter.

The deal - which Walmart's chief executive, Doug McMillon, flew to Tokyo to announce - will allow Walmart's online grocery business in Japan to expand exponentially.


"We are excited to partner with Walmart because of its commitment to creating the best solutions to serve customers with low prices", Mikitani added.

The delivery service will be offered through Walmart's Japanese subsidiary, Seiyu. Rakuten Seiyu Netsuper will aim to increase fulfillment capacity, enrich the merchandise offering and improve convenience for the customer.

Sato, however, expressed doubt when it came to Kobo's chances of success in the U.S.

The new service will be powered by Rakuten technology, using artificial intelligence "to offer a more personalized merchandise offering", according to the statement. Walmart will be Kobo's "exclusive" USA partner, meaning it will be the biggest retailer to sell Kobo e-readers in the country, along with access to its library of over six million e-books. In 2016, Japan was the second-largest market outside the USA for Amazon, following Germany, with sales of $10.8 billion.

It will enable customers to order via Rakuten's electronic marketplace platform, which will then be completed by the Walmart and Rakuten partnership.

The most interesting facet of the alliance however, from a US market perspective at least, is that Rakuten will leverage Walmart to help sell its Kobo ereaders. In 2010, it acquired California-based Buy.com and rebranded it as Rakuten.com.

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