The deal is aimed at combining JD’s expertise in logistics and supply chain with Google’s technology to experiment with changes in how people shop.

(Staff and Bloomberg)—Google is investing $550 million in cash in China’s Inc. as the U.S. search giant pushes deeper into online commerce. is the largest retailer in Asia, ranking No. 1 in the Internet Retailer 2018 Asia 500. Its revenue for 2017 reached $55.7 billion, up 40.3% from 2016. is also No. 5 in the Internet Retailer 2018 Online Marketplaces, with gross merchandise volume (GMV) up 40.1% from 2016 at an Internet Retailer-estimated $197.6 billion—more than double the GMV of eBay Inc. (No. 4).

Alphabet Inc.’s Google will buy newly issued Class A shares at $20.29 per share, equivalent to $40.58 per ADS, or American depository share, the companies said in a joint statement Monday. The pair plan to explore joint development of retail solutions in a number of areas around the world, including Southeast Asia, the U.S. and Europe. The deal comes just a week after Google struck an alliance with Carrefour SA to sell groceries online in France through the U.S. company’s platforms including Home and Assistant.

The flurry of activity signals Google’s growing ambitions in e-commerce. The French partnership will allow consumers to order staples through Google services on their smartphones, tablets or other devices. The latest deal is aimed at combining JD’s expertise in logistics and supply chain with Google’s technology to experiment with changes in how people shop.


“We are excited to partner with and explore new solutions for retail ecosystems around the world to enable helpful, personalized and frictionless shopping experiences that give consumers the power to shop wherever and however they want,” Philipp Schindler, Google chief business officer, said in the statement.

One of the draws for Google is that has its own fulfillment and logistics network, similar to Inc. (No. 1 in the Internet Retailer 2018 Top 1000), said Bloomberg intelligence analyst Jitendra Waral. offers Google a more scalable infrastructure than that of other China-based e-commerce monoliths such as Alibaba Group Holding Ltd, which focus more on listings.

Retail is the biggest advertising area for Google, and the search giant’s spending on e-commerce is likely to increase, Waral said. The partnership with represents Google’s push to develop a long-term defense strategy against Amazon’s ad-market with two main goals: to retain their strength in retail advertising, and to expand into a bigger addressable market.


“It’s an offensive and defensive play,” Waral said.

The partnership with will likely serve as a benchmark for other retailers fighting against Amazon, as it will make it easier for Google to sell ad and cloud services and AI tools down the line, Waral said.

Google and JD have already teamed up elsewhere. They both participated in the latest funding round of Indonesia’s Go-Jek, a challenger in the ride-hailing business in Southeast Asia.


JD, which competes with giant Alibaba Group Holding Ltd., came under fire last month by a hedge-fund manager, who called China’s No. 2 e-commerce operator overvalued and criticized its “silly” investments. Kok Hoi Wong, chief investment officer for APS Asset Management Pte, said his own internal valuation for the $63 billion company was “a tiny figure.”

Alibaba owns and operates Taobao and Tmall, which hold the No. 1 and No. 2 spots on the Online Marketplaces.