Amazon wants a bigger retail footprint. The company made that clear when they bought Whole Foods in 2017 for $13.7 billion. Amazon may open 3,000 cashierless stores across the country over the next three years. But Amazon needs more than Amazon stores with techy perks to stay on top. Amazon needs a Walmart type chain that can give the 5,000-store Fort Smith Arkansas serious competition. Target can do that if Amazon gives Target the tools to do that. Target’s 1,800 stores would give Amazon the credibility the company needs to beat Walmart’s in-store sales figures in cities across the country.
If Target and Amazon get together, Walmart will have to clean up their retail image. Walmart got its start by being the cheapest big retailer in the game. Walmart was all about the lowest price. Product quality or store display didn’t mean much to Walmart executives, and that worked for decades. But Amazon changed the retail game by using a free delivery program called Prime. Free shipping hooked Walmart shoppers, and that forced Walmart executives to add their shop online pickup in store service. Plus, Walmart expanded their product offerings online. The company officially entered the techno-selling age by showing their customers they could compete with Amazon online.
Loup Venture’s analyst Gene Munster thought Amazon would close a deal with Target in 2018. But the CEO of Loup Ventures, Andrew Murphy, said the company didn’t get that prediction right. Murphy also said a deal between Amazon and Target still makes sense in 2019. But Murphy won’t say if he thinks 2019 is the year a deal might happen.
Target likes to do things their way. That’s one reason some analysts say a deal with Amazon won’t happen. Minneapolis-based Target knows Amazon will change a few things like bringing Target’s online business out of the dark ages. Buying products from Target online can be a painful experience for shoppers. Amazon can help change Target’s online shopping experience, and that upgrade would certainly have an impact on Walmart’s online retail store.
Even though Loup Venture’s stands by their prediction, there’s no comment from Amazon and Target. If the predictions about an economic downturn come true, 2019 might not be the year for an Amazon-Target marriage. But according to some investors, the marriage may happen sooner than later if Target needs a lifeline due to the recession that economist say is in the works.