Amazon looks for more in-roads into India
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Amazon looks for more in-roads into India

Amazon may have passed up a recent opportunity to buy India’s biggest online grocer, but it’s not taking its foot off the gas when it comes to travelling further into Indian Ecommerce. The company, which will be competing with Chinese online retail giant Alibaba for market share, is set to buy a 5% stake in Shoppers Stop Ltd. This marks Amazon’s first investment in a publicly traded retailer in India, but it may well not be the last – Amazon CEO Jeff Bezos has earmarked $5 billion for his expansion into the country.

Amazon’s share price has risen by 27% so far this year

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SOURCE: Yahoo Finance

India is a major market for Amazon, hence Bezos’ willingness to throw cash into it. Alibaba has dominated the Chinese Ecommerce market, leaving little room for Amazon to branch out into the world’s biggest emerging market. India, in number two spot, therefore becomes far more relevant. But Amazon is not uncontested there: Alibaba is also moving in.

The Shoppers Stop deal will see Amazon place its “experience centers” in the chain’s 80 brick-and-mortar locations. These outlets will let customers try out products available online, driving traffic to Amazon’s Indian site. Shoppers Stop will also be present on this site: the company will have an exclusive flagship store on Amazon, where it will sell its entire portfolio of 400 brands.

Disclosure

Dominion holds Amazon in its Global Trends Ecommerce Fund.


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