Walmart Stores, Inc. (WMT) proposed the purchase of popular short-form video app TikTok in partnership with Microsoft Corp, which could turn the retailer into an online advertising leader, analysts predict.
The purchase would equip Walmart to compete with retail giants like Amazon.com Inc, Facebook Inc, and Alphabet Inc’s Google and dominate social media allowing the retailer to reach customers across virtual and physical sales channels.
The sale of Chinese-owned companies, TikTok is under serious scanner from the Trump administration, because of the potential national security risk it throws due to the large amount of private data the app has of U.S users.
“Walmart is going to see a very quick rise in ad spend” if its bid succeeds, stated Scott Smigler, president of e-commerce marketing agency Exclusive Concepts. “From a brand standpoint, it’s a no brainer because of the reach Walmart has and the huge shift we’re seeing right now from offline to online (spending), For all of our brands and retailers that are eligible, we’re going to want them on Walmart for sure.” he added.
The deal could be an important step for Walmart, as the retailer is finding new ways to win over market share from rival Amazon.com, as the number of consumers shopping online is growing rapidly. Walmart recently scooped up online brands Bonobos for $310 million in 2017, and Art.com purchased for an undisclosed amount in 2018. Walmart’s Vudu still lags far behind the monthly viewership numbers that competitors Netflix and Hulu have.
TikTok owner ByteDance aims to strike a deal by Sept. 15.
Walmart Stores, Inc. (WMT) is a worldwide retailer that operates in various formats. The three segments of the company include Walmart U.S., Walmart International, and Sam’s Club. The company is comprised of discount stores, supermarkets, supercenters, hypermarkets, warehouse clubs, cash and carry stores, home improvement stores, specialty electronics stores, apparel stores, drug stores, convenience stores, and membership-only warehouse clubs; and retail Websites. To learn more about Walmart (WMT) and to continue to track its progress please visit the Vista Partners Walmart Coverage Page.
Vista Partners LLC (”Vista”) is a California Registered Investment Advisor based in San Francisco. Vista delivers timely and relevant insights via the website: www.vistapglobal.com with daily stories, weekly market updates, monthly macroeconomic newsletters, podcasts, & Vista’s proprietary equity and market research to help you stay informed and stay competitive. Vista’s mission is to invest partner capital while arming investors with a comprehensive global financial perspective across all market sectors. Vista also seeks to provide select issuers with actionable advice regarding fundamental development, corporate governance, and capital market directives.
Stay Informed! Stay Competitive! Please join us at Vista Partners and receive our FREE email updates throughout the week and view our exclusive content and research.