Wal-mart is Buying Amazon.com, Really

Okay, there are now two of us who think Wal-mart is going to buy Amazon.com this year — that makes it a lock doesn’t it?

Bold business prediction for 2006: Wal-Mart will buy Amazon.com.
       – T. J. McGill, Evergreen Pacific Partners (Seattle)

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Comments

  1. thoughtfulman says:

    I just thought of a way this would be disastrous. Almost all stores with both a web and brick presence (including Wal-Mart!) allow you to return to the brick store what you bought on the web. This simply could not work in a Wal-Mart/Amazon combination.

  2. Franklin Stubbs says:

    Um, why couldn’t you flip that around and say that the presence of a nearby return site (physical Wal-Mart) would make customers that much more comfortable buying high-end-electronics type products from Amazon.
    I know I’d be more comfortable buying a $300 gizmohickey online if I knew I could return it to a nearby store. Ironically this would let Wal-Mart muscle in on the high-end products business (via Amazon) while still keeping its physical shelf-space devoted to made in low-end stuff.

  3. thoughtfulman says:

    Amazon lives by the long tail. Well, not totally, but way more so than Wal-Mart. If you return Zamfir’s Greatest Hits to the local Wal-Mart, it will stay there forever. Wal-Mart eliminates any inventory that doesn’t sell by the zillions — they amputate any long tail they find growing. They’re complete opposites in that respect, but not complementary. At least, that’s what I think.

  4. Come on, Paul. The guy thinks Microsoft’s stock is going to go up by 30 per cent this year — he’s clearly on drugs :-)

  5. Franklin Stubbs says:

    Yeah but what retailer lets you return music or movies in the first place once opened? If you don’t like Zamfir or Meatballs IV you’re stuck, regardless of where you bought. Nobody takes back opened media materials.
    Unless of course, a friendly Amazon kiosk within your local Wal-Mart offered to resell Zamfir for you, at a modest fee, and credit the few bucks to your account at no charge… another way the combo makes money, in-house ebay type shops for people to drop off their old CDs, DVDs, videogames, books…
    The combination just plain works. Only drawback is Amazon’s yuppie friendly, starbucks compatible persona vs Wal-Mart’s my-name-is-earl, barefoot-and-pregnant one. They’d have to work on that marriage.

  6. Chris says:

    If that acquisition did go through, IMHO the most underrated asset that Walmart would be acquiring would be Amazon’s amazing analytics- their masses of collected data, and their software/infrastructure, and the people who know how to use it and continue improving it.
    The recent flap about Walmart.com recommending “Planet of the Apes” to folks looking at an MLK DVD would be a case in point. Ignore the racism thing, that’s a red herring- of course it was not racism but simply a suggester application that was a fourth-rate Amazon rip-off that never worked that well in the first place.

  7. Chris says:

    One more thing, that’s that of course Franklin Stubbs is quite right about the persona difference.
    Simply put I think there are a lot of people in the Amazon demographic who really don’t want to shop at Walmart. They may not be so fanatic that they’d try and prevent other people from shopping at Walmart, but would definitely not allow themselves to be effectively “forced” to buy from Walmart.
    I think that the biggest people so many people use Firefox is so they can avoid using a browser made by Microsoft. Walmart probably has just as many or more folks who would “veto” it in this way, they’re just not as visible as the anti-Microsoft folks since (thank God) they’re not as big a monopoly as Microsoft (yet)

  8. Michael Robinson says:

    Chris: “IMHO the most underrated asset that Walmart would be acquiring would be Amazon’s amazing analytics- their masses of collected data, and their software/infrastructure, and the people who know how to use it and continue improving it.”
    Ironically, those people originally came from Walmart, where they learned how to do that in the first place:
    http://www.informationweek.com/722/22iuwal.htm