“We know that many of our customers already shop on-line, and with Buy.com we will be moving quickly to create the UK’s best on-line department store”, said Luke Mayhew, John Lewis’ trading director. The company intends to continue development of its own department store’s web site, which currently offers a limited range of merchandise, in parallel with further development of Buy.com in the UK.
Buy.com was launched in the UK in March 2000 and was quoted as being the fourth most visited e-commerce web site in the UK in December 2000, with 550,000 unique visitors.
The UK arm of Buy.com has been for sale, however, since its US parent company ran into troubles in the US and cancelled plans to open in Continental Europe. It is currently in the process of shutting down or selling its operations in Canada and Australia, after reporting fourth-quarter losses of $27.4 million (£18,674,196).
Market analysts and e-commerce consultants are reporting a growth in alliances or acquisitions of this type, with traditional retail companies looking to develop their e-commerce strategy by acquiring the management skills of an existing dot.com. Market analysts are seeing deals like this as part of a rapidly growing trend by traditional ‘bricks and mortar’ companies buying the set up and ideas of troubled ‘clicks and mortar’ dot com companies.
The deal is set to close by the end of this month, but the terms are not being disclosed.