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Bloomberg
With Amazon now gobbling up more than 40 percent of all online spending in the US, that’s left traditional retailers scrambling for the rest.
Walmart Inc., Target Corp. and Best Buy Co. have all made big investments in recent years in e-commerce — sprucing up websites, offering more delivery options and making acquisitions like Walmart’s $16 billion deal for India’s Flipkart. But growth rates are naturally slowing as their online units mature, and all that spending is taking a toll on profitability in a sector that already operates on razor-thin margins.
That’s rattled investors, who punished all three companies after their first-quarter results despite strong sales growth across
the board.
At least one retail chief doesn’t place much stock in dot-com growth rates. Best Buy Chief Executive Officer Hubert Joly said that breaking out online sales separately “might not make sense†in the future as half of the company’s online orders are picked up inside or shipped from its stores. The CEOs of Target and Walmart also say they want to serve the custom-ers any way they want to shop — online or not — as long as they’re spending.