Cakmak said that all the hype around speculation of a Target acquisition misses a few key points, writes Casey Coombs in Puget Sound Business Journal.
“They need brand affinity. It’s not just about the footprint,” he said during a Jan. 4 interview with CNBC. “They need to flex the muscles on the pricing side, and it’s about improving selection.”
Target doesn’t tick off those boxes, he said, offering up three companies that could be the target of Amazon’s next buyout.
Sephora competitor Ulta Beauty is one of them, due to its antiquated shopping experience and high prices, he said.
Lyft is another potential acquisition target.
Bringing the popular ride-share company under Amazon’s fold would strengthen the retailer’s last-mile logistics and beef up its self-driving efforts against companies like Google and Uber.
A Costco acquisition makes sense on the retail side for its quality private label brand, Kirkland Signature, Cakmak said.
Last year, Amazon (Nasdaq: AMZN) finalized its largest buyout ever: paying $13.7 billion for Austin, Texas-based Whole Foods Market Inc.
Costco (Nasdaq: COST) has eight locations in Greater Philadelphia, with a Mount Laurel, N.J. spot the closest to the city.
However, Target (NYSE: TGT) has around 20 stores in the area with recent additions of its small-format concept in Philadelphia. It also has plans to open in Ardmore. The retailer recently made its own big deal, in which it will acquire Instacart rival Shipt Inc. in a deal worth $550 million. Costco also has been stepping up its delivery game.