Amazon lowered the boom on Walmart (NYSE:WMT). As the discount retailer announced plans to acquire Bonobos Fridayâa menâs clothing company for $310 million, Amazon said it plans to buy Whole Foods (NYSE:WFM) for $13.7 billion.
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Walmart shares finished the session 3% lower, a sign investors are betting Amazonâs e-commerce strategy will continue to dominate the industry, its shares jumped over 2%.
Amazonâs bet on the organic grocer will help the company better compete against Walmartâwhich is currently the leading grocer âbeating out competitors like Safeway and Kroger (NYSE:KR)âaccording to a 2015 Consumer Report that says the retailer captures about 25% of the grocery market in the U.S., up from around 7% in 2002.
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On Thursday, Kroger shares had the biggest percentage drop, 24.6%, since 1999. The chain posted its second-straight quarter of same-store sales declines and lowered its 2017 guidance. Additionally, both Walmart and Amazon are experimenting with drive-up grocery stores models.
In May, Amazon opened up two test locations in Seattle, which will allow Amazon Prime subscribers to place a grocery order online and then pick-up at a drive through window.
Walmart announced similar plans last week with a plan to test an automated grocery kiosk at a store location in Oklahoma City. The concept will allow customers to order groceries thru their app and pickup it up at a location using a special code.
As Amazon targets Walmartâs grocery arm, Walmart has been doing the same by ramping up its overall e-commerce push. Along with todayâs deal, it recently acquired apparel retailers Moosejaw and Modcloth. Last August, it paid $3 billion for consumer products retailer Jet.com.