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The Wall Street Journal reports that Walmart is close to finalizing a deal that would add department store chain Lord & Taylor to its website, part of a broader strategy to diversify its online offerings beyond its price-oriented image.

This strategy is designed to help Walmart position itself better to compete with Amazon; it also could help Lord & Taylor get more web traffic at a tough time for the department store industry.

Since Walmart bought Jet and installed that online company’s founder, Marc Lore, as its head of US e-commerce operations, it has been buying up small specialty retailers such as Bonobos and Moosejaw. Even though these retailers are not in synch with the Walmart/Jet typical value-driven approach, the feeling seems to be that it makes sense to spread its bets around.

The Journal suggests that this is not dissimilar from the approach being taken by Amazon, though it is coming at the issue from a different direction: “Amazon has made an aggressive push in recent years to win over fashion brands. It scored a coup in June when Nike Inc. agreed to sell some of its products directly to the e-commerce company, and over the years it has reached agreements with department store stalwarts such as Calvin Klein, Kate Spade and Levi Strauss. Amazon has also extended its reach into physical stores, buying grocer Whole Foods, and striking a deal with department store Kohl’s Corp. that lets shoppers return goods bought on Amazon at 82 Kohl’s locations.”
KC's View:
It really is interesting to watch these two companies assemble various pieces that they believe will serve them well in this pitched battle, especially because it seems pretty clear that neither is done … there are more moves to be made, and some of them, I suspect, will be unexpected.

The question, increasingly, becomes the degree to which smaller competitors are going to remain viable.