Wal-Mart Stores (NYSE:WMT) just teamed up with Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL). The Google Express service already featured 46 retail partners, but none with the market heft of Sam Walton's shopping empire.
Now that Wal-Mart is aboard, does that make Google Express a serious challenger to Amazon.com (NASDAQ:AMZN) and its voice-shopping tools powered by Alexa and Amazon Echo?
Let's find out.
What is Google Express?
Google Express has been around for six months now. The service lets you place online shopping orders through a web site, a mobile app, or the voice-controlled Google Assistant tool. It's the last option that's a potential game-changer here, and it includes support for the Google Home voice-controlled home automation helper.
The service has featured a plethora of household-name retail partners from the start. The original announcement name-dropped Costco (NASDAQ:COST), Walgreens (NASDAQ:WBA), and Whole Foods Market (NASDAQ:WFM). Early additions included Target (NYSE:TGT) and Kohl's (NYSE:KSS). Any way you slice it, that was always a pretty impressive range of well-known store brands. I wouldn't be surprised to see Whole Foods dropping off Google's partner list since it was bought by Amazon, but the organic food store veteran is still aboard the good ship Google Express.
How big of a deal is Wal-Mart?
Wal-Mart takes Google Express to a whole new level. The annual sales of the other retailers I've listed here add up to just 70% of Wal-Mart's revenue tally.
Also, Google Express doesn't blanket the American map equally. If you're shopping from New York City, you'll have access to 36 stores today (not including Wal-Mart, which joins the fray in September). In Beverly Hills, California the list shrinks to 34 names. In the relative backwaters of Tampa, Florida, I have to settle for 29 store partners.
Wal-Mart should pop up on most of these lists next month, given the retailer's massive footprint of physical stores. And if you only get one shopping option, Wal-Mart offers a juicy combo of low prices and a wide product selection.
If Wal-Mart was shopping around for an e-commerce partner, Google claimed a big prize here. Of course, the retailer's management takes a dim view of rising rival Amazon, and was never likely to throw in its lot with the leading e-commerce platform anyhow. But the online shopping market is larger than just Amazon and Google, so at least this deal keeps Wal-Mart's partnership away from other hopefuls.
These are still the early days of online shopping in general and of voice-driven shopping tools in particular. We are watching a few major players in these markets staking out their strategies right now. It's a little early to pick long-term winners here, even if the largest retailer on the planet is teaming up with a leading online business early on.
As a shareholder of both Alphabet and Amazon, I hope to see both companies escalating this fight much further. Voice-powered technology is one of the biggest sea changes going on right now, and pairing that revolution with the cold, hard dollars of shopping experiences can only be a good thing -- for the winners.