How does Walmart extend open innovation via $225 Million acquistion?
Walmart Mexico (Walmex) reported that its majority shareholder agreed to buy Cornershop for 225 million dollars. After that acquisition, it will sell the operations of the home delivery platform in Mexico and Central America.
The purchase of Cornershop for 225 million dollars, is undoubtedly an example of the strategic coherence of the global retail leader to capitalize on the development of the potential online purchase. Cornershop has the platform to support the delivery of orders from supermarkets, pharmacies, and other specialized stores.
The online sales of WalMart in the US alone, grew 44% in the fiscal year of 2018. This figure is reaching 11.5 billion dollars by now.
That is why Walmart needs to deal with a successful platform like Cornershop to ensure the delivery of the final product in a short time possible. In this case, less than 90 minutes. That way, it is offering a virtually unbeatable shopping experience to their customers.
In the USA, Walmart had acquired the Modcloth, Moosejaw and Monobos online brands in 2017. Also in 2017, it acquired the Parcel startup, which specializes in the delivery of perishable products to customers in the New York area.
For several months now, it has been offering delivery service, with deliveries on the same day in nearly 100 major cities in the USA.
Walmart USA has been working for some time with a series of strategic partners, specialized in "on demand" delivery services, such as Postmates, Doordash, and Google Express among others. The problem here is, there is no significance movement in non-US market, especially, in South and Central America
"Walmart is experiencing the greatest transformation in its history and Chile is the protagonist. Here the country and the customers will be the most benefited: more services will be added to the platform, we will expand our coverage and the shopping experience will improve its already high-quality standards: fast, simple and with products at the lowest prices every day," explained the CEO of Walmart Chile.
Horacio Barbeito, general manager of Walmart Chile, highlighted the operation as a clear sign of the transition that the company is experiencing globally, which has opted to expand its presence in the digital world.
"The acquisition of Cornershop is very special for Walmex, as it marks a major step towards fulfilling our goal of becoming the best omnichannel retailer in Mexico: Cornershop's digital leadership, technology and capabilities, combined with infrastructure, scale, Walmex's experience and logistical capabilities will allow us to accelerate growth and deliver a frictionless shopping experience to more customers," said Guilherme Loureiro, president and CEO of Walmart Mexco
Cornershop Business Model
Founded in 2015, Cornershop is made up of an experienced team led by its Chilean co-founders Daniel Undurraga and Juan Pablo Cuevas and the Swedish Oskar Hjertonsson, current CEO, who will remain at the forefront of the digital business.
The idea of Cornershop is simple. You ask for what you want from a supermarket or pharmacy. Then, they take it to your home, all through a friendly mobile app interface dealing with only small fees.