November 25, 2014, this date created a buzz in online media, when VCCIRCLE reported about the “possible biggest buyout deal” for universe’s largest e-commerce firm Amazon inc. when it initiated the talks with Indian lifestyle e-tailer Jabong.com. On analyzing the strong effect of Flipkart-Myntra merger deal for $300 Million, Amazon started making its strategy to grip on the market space by initiating talks with Jabong, which is accountable for controlling about 25% of the market. But according to the latest news, the deal is no more in the pipeline.
Earlier in the talks, Jabong which is backed by Rocket Internet, were evaluated at a whooping $1.2 Billion. The deal, which was said to be the biggest in Indian e-commerce acquisition space, could have provided Amazon with the much needed upper hand to be the front player in the domain. However the reason for the same has not been made public yet.
India’s online fashion market is dominated by the merged Flipkart and Myntra with a combined market share of 50 per cent, while Jabong controls 25 per cent of the market and others, such as Fashionara, Limeroad.com and Zovi, the rest. Jabong had reported a gross merchandise value (GMV) of Rs 509 crore from three million orders in the January-June period of this year.
Jabong is now concentrating on its global integration into Global Fashion Group (GFG) which will be operational in the next two to three months. GFG, an emerging markets-focused fashion e-commerce firm has Dafiti (Latin America), Lamoda (Russia and CIS), Namshi (Middle East) and Zalora (South East Asia and Australia) and covers 23 countries.
In a separate development, Amazon was also reportedly in talks to buy London-based luxury fashion products e-tailer Net-A-Porter. Early this week, Italian online fashion retailer Yoox inked the deal to buy Net-A-Porter.
The development in the Indian e-commerce market has always been on the verge of greater competency among the leaders. We are sure, this sunset will surely be creating another sunrise somewhere else down the line. We just have to wait and watch!!