In the old days, a landmark retail deal would typically mean an audacious M&A. Walmart’s acquisition of Asda or Kingfisher’s pounce on Castorama set the tone.

Carrefour aims to benefit from Google's tech prowess to 'create new commerce experiences'

Carrefour aims to benefit from Google’s tech prowess to ‘create new commerce experiences’

Such deals have not gone away – Sainsbury’s proposed merger with Asda and Tesco’s tie-up with Booker show that, and each could be transformative as well as defensive.

But there’s a new type of deal emerging, which is yet another signal of how retail continues to be refashioned by new technology.

In the past week Google has taken a stake in and struck a strategic partnership with Chinese ecommerce giant JD.com, and forged an alliance with French grocery giant Carrefour.

Google’s $500m investment in JD means the pair will combine the tech prowess of one with the other’s supply chain and logistics strengths to “explore the creation of next generation retail infrastructure solutions with the goal of offering helpful, personalised and frictionless shopping experiences”.

“The fact that in today’s landscape Carrefour is tying up with Google rather than snapping up another retailer is telling about the contemporary and future dynamics of retailing”

In France, the aim is to “bring together the expertise of both companies to offer consumers new and innovative commerce experiences… whether that’s in a store, online, on smartphones, or with voice”.

A few years back, Carrefour would have been among those retailers growing through traditional megadeals – in the late 1990s it merged with counterpart Promodes to create the biggest food retail group in Europe and the second largest in the world.

So the fact that in today’s landscape it is tying up with Google (even if no equity is being exchanged) rather than snapping up another retailer is telling about the contemporary and future dynamics of retailing.

New style of deals

If it’s happening in China, in Europe and the US – Amazon’s takeover of Whole Foods could be seen in a similar light, albeit that was a full-sale acquisition – then perhaps the same will happen here.

You might even ask why it isn’t. How different might M&S’s proposition and performance be if Google or a similar new digital giant were an investor or partner, and the retailer’s operations benefited from the knowledge, insights and technological imagination it might bring?

“Might HoF be thriving rather than gasping for life had it attracted the attention of a different sort of Chinese investor, an Alibaba for instance, rather than the one it ended up with?”

Might House of Fraser be thriving rather than gasping for life had it attracted the attention of a different sort of Chinese investor, an Alibaba for instance, rather than the one it ended up with?

While how they play out remains unknown for the time being, the new style of deals seem to be predicated more on a genuine sense of partnership than was sometimes the case in the past.

In fact they ultimately involve a wide range of parties. Walmart is also a shareholder in JD, meaning it is the online shopping platform for the US Goliath’s bricks-and-mortar stores in China was well as an ecomm investment in its own right.

The ideal business model blending online and offline operations is a holy grail for many retailers at present, and the latest tie-ups show that retailers and tech companies alike recognise each has strengths and opportunities that the other doesn’t.

They are combined strengths, however, which Amazon does have. And in some respects Amazon represents competition for Google as much as it does for traditional retailers.

Last December, for instance, a Survata study in the US found that 49% of consumers’ first product search was through Amazon, while search engines accounted for 36% and retailers only 15%.

Retailers increasingly recognise that the answers to the problems they face, or the ability to fully exploit opportunity, is not in their gift to the extent it once was.

That means new ways of doing things, including new sorts of partnerships.

As long as the new-style deals don’t suffer the problems that often dogged the old-fashioned ones, such as clashes of ego or the preservation of baronial fiefdoms, they could represent a new way forward.

It will be astonishing if, in the next few months, some of the UK’s big retail names are not following in Carrefour’s footsteps.

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