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Move Over Amazon. Target and Kroger might be tying the knot – or at least some speculators thought this was going to happen.
After Amazon’s $13.7 billion acquisition of Whole Foods Market in August 2017, other retailers are rethinking their market strategy. And for good reason. Amazon is dominating the grocery industry and is eyeing more industries for its’ mass expansion. With over $700 billion market capitalization, Amazon is valued higher than Walmart, Target, and Kroger combined.
That’s why other companies are doing whatever it takes to hang on to the market share that is still left – even exploring the possibility of teaming up to avoid falling down.
Retail veterans, Target & Kroger, aren’t allowing Amazon to claim a 100% market victory yet.
News sources say that Target and Kroger may not be on the verge of merging anytime soon but the two companies have discussed working together. And the most appealing partnership opportunity comes from Target’s acquisition of app-based delivery service, Shipt.
Target acquired Shipt in December 2017 for $550 million in cash, making Shipt a wholly owned Target subsidiary. The company was founded in 2014 by Birmingham-based millennial Bill Smith. Under Smith’s leadership, the delivery service gained a network of over 40,000 personal shoppers who provide high-quality same day delivery service in over 80 U.S. markets.
The acquisition of Shipt gives Target it’s own platform to cater to customers in a unique way. Although there may seem to be competition from InstaCart and Amazon Fresh, two on-demand delivery services that focus on customers in specific markets, Target is well positioned to use strategy to maintain it’s position in the retail industry.
What’s next for Kroger and Target? The specific plans haven’t been revealed yet but rumors of a possible merger did cause both stock prices to soar on Friday, March 23rd.
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