Dive Brief:

• Wal-Mart is accelerating efforts to grow its e-commerce business across China, with an emphasis on online sales of food, a category that does brisk business in the nation’s busy cities.

• Wal-Mart's shift to e-commerce in China comes after it slowed its ambitions for physical stores there last year.

• Wal-Mart assumed full control of its e-commerce site in China in mid-2015, three years after increasing its stake in e-commerce company Yihaodian to 51%. Upon taking over the site, the retailer said it would invest in its e-commerce services and vowed to create a seamless omnichannel experience encompassing online, mobile and brick-and-mortar sales.

Dive Insight:

According to the Associated Press, Wal-Mart currently controls just 1.6% of China's overall online retail market, far behind Alibaba at 46.9% and JD.com at 20.1%. But Wal-Mart's e-commerce efforts may ultimately fare better in China than in the U.S. Online sales, especially of food, are more mature and more ubiquitous there, while here at home Wal-Mart has experienced just 8% growth, well below that of rivals like Target and Amazon. 

“If you look at the U.S. market in 2015, e-commerce grew at 14.6% year on year,” retail futurist Doug Stephens told Retail Dive earlier this year. “If Wal-Mart grew at 8%, they were on the losing end, and somebody else was on the winning end, if you look at it from that very binary standpoint, because if you’re not at least growing with the market, you’re falling behind. It is important because in the long term we have to account for the fact that the consumer lives with this pervasive belief that they can get what they want, whenever they want it, wherever they are. If [Wal-Mart is] not at least keeping pace with the marketplace, they’re only going to look more inconvenient over time.”

To keep pace in China, Wal-Mart is expanding the number of delivery hubs it operates. Yihaodian currently oversees 250 e-commerce hubs, and in some places, Wal-Mart offers delivery of selected grocery items within three hours.

Moving forward, Wal-Mart plans increase its product selection, spotlighting items like imported foods, the Associated Press notes. In addition, Wal-Mart is extending its technological capabilities: Last year it launched an app that lets shoppers order online and pick up goods at stores in southern cities like Shenzhen, Guangzhou and Dongguan.

But Alibaba and JD.com may have built insurmountable leads. Alibaba operates 14,000 hubs in rural China alone and even more in cities, and JD.com oversees around 6,000 delivery and pickup stations across roughly 2,500 Chinese counties and districts.

"It will be very difficult for Wal-Mart to catch up in e-commerce," Kantar Worldpanel China’s general manager Jason Yu told the AP.