Wal-Mart CFO says having two e-commerce platforms will ‘allow us to try new things’

It is no secret that Wal-Mart’s pending acquisition of Jet.com in the U.S. and recent partnership with JD.com in China are strategic plays the retail giant hopes will help its own e-commerce brand in the future.

Wal-Mart Stores Chief Financial Officer Brett Biggs recently told analysts that the moves are part of the retailer’s growth plans in the changing retail dynamic. Biggs was one of the featured speakers at the Goldman Sachs Global Retail Conference held in New York.

“Jet on its own is an exciting brand, it’s grown very quickly and what they do with their smart cart technology is really interesting and unique in the way they have a customer build a basket. So having that unique brand like Jet is great for us,” Biggs said.

He added that Wal-Mart is excited about the differences in the two brands and how leveraging one against the other is likely to improve Walmart.com and Jet.com.

“I had a chance to meet with the Jet team yesterday … Marc Lore and his team have astute knowledge in this industry which is a big benefit,” Biggs said.

Biggs said Walmart.com has build at good foundation under Neil Ashe’s leadership, but now Lore can bring his team and their unique insight sharing information back and forth between the two brands.

After investing heavily in e-commerce infrastructure over the past two years, Biggs said investors began to see some of the fruits in the recent quarter reported Aug. 18. There was an acceleration in Gross Market Value growth by 13%, in part because of the retailer’s push to add marketplace or third party suppliers. With respect to the marketplace push, Biggs said Wal-Mart wants to be there for the customer with first party, third party or any other way they want to shop.

When asked if the two brands – Jet and Walmart.com – would co-exist long term or if one would be folded into the other, Biggs said Wal-Mart has experience running multiple brands. In the U.S. there is Neighborhood Market and Supercenters and globally there are many multiple brands that allow Walmart to reach customers in different ways.

“Having two brands in e-commerce will allow us to try new things, lever each brand and take strengths from both. Jet also serves a more urban customer which is a benefit,” Biggs added.

When asked about the $3.3 billion paid for Jet.com, Biggs said the capital allocation is a way Wal-Mart can reinvest back into the business to enhance shareholder return. Wal-Mart has to ensure it has a healthy business long term, while understanding that shorter and mid-term results are also watched closely by investors, he said.

Somewhat overshadowed in recent weeks is the JD.Com partnership which analysts say is a big deal for Walmart’s growth in China. Biggs said the JD.com deal made a lot of sense when considering that Yihoadian’s reach in China was limited. He said the Yihaodian business was good but China’s landscape is huge and partnering with the No. 2 player in that country looked to be the best way to grow internet sales in China.

Analysts applaud the recent moves by Wal-Mart to try grow its ecommerce business. Veteran retail analyst Walter Loeb of Loeb & Associates noted in a recent blog post that the Jet.com and JD partnership provide Wal-Mart with opportunities to become more competitive with giants like Amazon and Alibaba.

Loeb said Walmart will be in a more competitive position with opportunities to take market share which is what management is aiming to do. In so doing, Loeb said, it’s the customer who will be the biggest winner, but likely not so great for the retail sector overall.

“Many will be hurt, when elephants fight, the ants get stomped on,” Loeb said.