It’s Amazon (AMZN) on one side and the rest of the corporate world on the other. Everybody seems to be forging partnerships to go up against the leading online retailer. The latest is Alphabet’s (GOOGL) subsidiary Google which is investing $550 million in Chinese e-commerce company JD.com as part of a strategic partnership to bring about a retail framework where shopping can be made more suitable for each customer with as fewer roadblocks as possible.
Through this collaboration, JD.com will make its products available in US and European markets through Google Shopping which will improve its product visibility and convenience of purchase. It would also help in expanding the retailer’s services beyond China. For Google, this partnership will provide the opportunity to grow into Asian markets and also to keep up with rivals like Amazon that have made investments in other technological areas.
Google, whose search engine was blocked in China over censorship issues, has made a few other investments in Asian companies such as the cab service provider Go-Jek in Indonesia and the mobile game company Chushou in China. Apart from this, Google also entered into a partnership with French retailer Carrefour SA to facilitate the order and purchase of groceries through smart devices.
Tencent and Walmart have also made investments in JD.com
JD.com, whose main competitor is Alibaba, also has investors in Tencent and Walmart (WMT). The online retailer has made significant investments in technology and logistics and claims to have a high-speed delivery system. JD has been testing drone delivery for rural areas to improve its logistics efforts.
As per an Axios report, 90% of the company’s deliveries in China are made in a single day while 57% are done in 12 hours. JD.com believes the super fast delivery service will prove to be a massive advantage for the company going forward.
The partnership between Google and JD.com comes at a sensitive time amid a brewing trade war between China, and the US. JD.com appears to have put its plans for expansion in the States on hold currently due to the tense situation between both the countries. The company, which was almost written off by a hedge fund manager at APS Asset Management, has managed to survive and is making the right efforts in moving ahead.
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