Walmart’s Flipkart May Be Its MVP Against Rival Amazon
India-Based Online Retailer
Walmart (WMT) is betting on Flipkart, a $37.6 billion e-commerce company based in India, to advance its competitive advantage against rival Amazon (AMZN). The US retailing giant owns 75% of Flipkart which, like Amazon, offers a diverse range of products from a variety of suppliers.
While the Indian online retailer initially focused on offline brands and value-oriented segments, it now has plans to target affluent consumers as well. As the company continues to expand, it is considering an IPO in the US next year, a move supported by Walmart.
Ambitious Expansion Plans
Flipkart’s ambitious expansion plans are meant to fulfill its vision of becoming India’s biggest online consumer company. It envisions a variety of segments that will complement its e-commerce offerings.
India is becoming one of the world’s largest online markets. Amazon is Flipkart’s primary competitor in the country. Walmart’s investment aims to expand its global reach and online competence, but there’s a connection to the US as well.
Possible 2023 IPO
In the US, Walmart has been struggling to get traction in the online space as it trails Amazon’s success by a significant margin. It wants a bigger piece of the $1 trillion US e-commerce pie. It currently lays claim to less than 7% market share, while Amazon boasts nearly 40%. Walmart has tried to improve its positioning through investment in fulfillment centers and improvement in delivery.
If Flipkart is able to realize its dream and achieve a dazzling IPO, Walmart may have success eating into some of Amazon’s e-commerce business.
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