Future Group and Amazon Partnership

From being dismissive about the potential of e-commerce in India to joining hands with the sector, leading ‘brick and mortar’ retailing entities seem to have had a chance of thinking on the former. A week after Future group Kishore Biyani alleged that online retailers were indulging in predatory pricing, the company announced a partnership with Amazon India.

The two companies will jointly sell goods over the internet amid growing friction between online and offline retailers over heavy discounting. Future group will sell more than 45 own labels of apparel, followed by in-house brands in the home, electronics and food categories, while the US headquartered company will handle order fulfillment and customer service for the merchandise on its portal. Both firms will also develop a new line of products across categories to be exclusively sold at Amazon and Future Group’s retail stores.

In its home market, Amazon had similar alliances with retailers such as Target Corp and Toys R US in the past decade though both sourced over time once the online seller gained scale and attracted other large brands. Following the India deal, Future Group’s four dozen own brands such as Lee Cooper, John Miller and Indigo nation will be taken off from online marketplaces where they are currently being sold.

It is also reported that Amazon is planning to open its first brick and mortar store in New York. The company main rivals in India are Flipkart, Snapdeal and other online stores. In the offline market, just three companies – Aditya Birla Madura Garments, Arvind Brands and Future Group either own or sell more than two dozen brands each, thus becoming the preferred options for any online player looking to partner retailers.

Industry insiders also said the Indian retailers move reflects a bid to expand into new distribution channels such as e-commerce in the search of growth. Last month, Snapdeal agreed to create Croma Flagship store on its e-commerce portal to sell electronics items including mobiles, tablets, and laptops. 

Flipkart and OLX Partnership

With more and more people accessing the internet through smartphones and tablets, the internet user base has grown to be around 243 million. This has led to exciting and booming e-commerce sector in the country. Last week, Flipkart announced that it had raised fresh capital of $1 Billion; soon afterwards, Amazon too announced that it will invest another $2 Billion in India.

In addition, keeping the momentum going, Internet firms Flipkart and OLX are joining hands for one of a kind marketing partnership. The two sites will launch a joint campaign ‘urging’ consumers to upgrade by selling used products on OLX before buying the new products on Flipkart. OLX was founded in 2006 and is owned by South African Internet Company Naspers, which is an investor in Flipkart. OLX is a marketplace for used goods, while Flipkart sells only new goods. The campaign will be on for a month, and will include several categories within electronics.

With this partnership with OLX, it will be able to provide an end-to-end solution to customers especially in electronics categories where selling old products is an integral part of the buying process. Earlier this year OLX competitor Quickr, had collaborated with Amazon owned Junglee, a price comparison portal. Through this Junglee, users could compare prices of new products across online shopping sites and find locally available pre-owned products listed on Quickr.com.

The first phase of the tie-up will be kicked off with a joint marketing campaign using consumers to upgrade by selling their used products on OLX.in before buying the new products on Flipkart. The Idea of this tie-up was conceived keeping in mind the strong and independent position of OLX and Flipkart in their respective market space. The rationale for the number one online classifieds platform and the leading e-commerce platform coming together for a marketing campaign is a seamless one. With so much funds and collaborations Flipkart is reviving their business model and in no time Flipkart will be India’s largest Online seller and they can beat Amazon in selling products online.