Myntra announced on Tuesday that it had acquired Jabong in a deal worth $70 million (in cash). This deal has come out of the blue, and many industry experts are probably scratching their heads. Most had expected and predicted that Snapdeal or Future Group were the front-runners to acquire Jabong (and GoJavas).
After the 'successful coup', Flipkart Founders Sachin Bansal and Binny Bansal took to Twitter to announce their 'spoils'.
While Flipkart (Myntra) has not yet clearly highlighted their thought process and why they decided to acquire the troubled Jabong, the ever-active Twitter junta dug deep and put forth interesting analysis on why Flipkart went ahead with the deal. Here are some of the highlights-
Bansals decided to acquire Jabong after 932nd unsuccessful attempt to unsubscribe from Jabong's daily sale emails. pic.twitter.com/AjL5OhFG75— Kunal Dua (@duak) July 26, 2016
Flipkart, Myntra and Jabong can together break Dr. Batra's world record of spamming people.— SAGAR (@sagarcasm) July 26, 2016
Myntra buys Jabong, influenced by its own End of Reason Sale last month.— Rohit Koshy (@artikay) July 26, 2016
So, Jabong's new parent is Myntra and grandparent Flipkart.— Keh Ke Peheno (@coolfunnytshirt) July 26, 2016
The Flipkart > Myntra > Jabong deal. pic.twitter.com/lrZxTZQRyz— abhishek tripathi (@abhishek_tri) July 26, 2016
Another major announcement today was Amazon launching its Prime service in India and offering a 60-day trial period for customers. Amazon and Flipkart have a history of going head-to-head in trying to outdo each other and timing their announcements at almost the same time. In July 2014, Flipkart announced its $1-billion funding round led by Tiger Global and Naspers. Not to be outdone, just a day later Amazon announced that it had set up a $2-billion India-specific fund for expansions.
Popular Twitter celebrity and Founder of Fandromeda and TenTenTen Ramesh Srivats summed up both announcements with a witty tweet-
Flipkart, Myntra & Jabong are now a composite, while Amazon Prime.#MakesNoSenseToMeAlso— Ramesh Srivats (@rameshsrivats) July 26, 2016
Amazon recently announced that it was upping its India investments to $5 billion and with founder Jeff Bezos' strategy to win India at all costs, Indian e-commerce platforms have been feeling the heat to scale up and also the cold, with the 'funding winter' upon India.
YourStory had also recently explored how a merger among the big boys of e-commerce could be a route to battle 'foreign elements' like Amazon and Alibaba that are slowly closing in on India.
The bigger question in the near future for Indian consumers though is a more pertinent one- monopoly in a certain space generally means no more discounts. So,
— YourStory (@YourStoryCo) July 26, 2016