Walmart enters talks to buy TikTok with Microsoft

Linda J. Dodson

Walmart, America’s biggest retailer by revenues, has struggled to match Amazon’s growth in internet shopping but is making a renewed push into online retail, hastened by the pandemic.

While not a natural steward of TikTok, whose key audience is smartphone-wielding teenagers and young adults, the company is believed to see the app as a potential springboard to growing online sales. TikTok has made only tentative steps in ecommerce but its Chinese counterpart, Douyin, is a major player in online shopping within China, letting users connect to online stores such as Alibaba’s Taobao and JD.com.

“The way TikTok has integrated ecommerce and advertising capabilities in other markets is a clear benefit to creators and users in those markets,” a Walmart spokesperson said, confirming deal talks. “We believe a potential relationship with TikTok US in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses.”

Teaming up with Microsoft, which is leading the bid, would form a coalition of the biggest rivals to Amazon’s two main businesses. Walmart is preparing to launch a subscription service to rival Amazon Prime, while Microsoft is the main competitor to Amazon’s cloud computing business.

Last month the two announced a five-year partnership that would see the supermarket giant use Microsoft’s cloud and artificial intelligence services. Donald Trump, who has called TikTok a national security threat due to its Chinese ownership, has given ByteDance until September 15 to sell its US operations or face a ban. 

The Oracle-led bid, which also includes ByteDance’s US investors such as venture capital firms General Atlantic and Sequoia, has offered $20bn in cash and stock, as well as a promise that 50pc of TikTok’s future profits will go to ByteDance, according to reports.

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