“Amazon and SOUQ.com share the same DNA – we’re both driven by customers, invention, and long-term thinking,” said Russ Grandinetti, Amazon Senior Vice President, International Consumer. “SOUQ.com pioneered e-commerce in the Middle East, creating a great shopping experience for their customers. We’re looking forward to both learning from and supporting them with Amazon technology and global resources. And together, we’ll work hard to provide the best possible service for millions of customers in the Middle East.”
The acquisition is expected to close in 2017. It will be the largest acquisition for Amazon since Twitch.
Amazon’s acquisition of Souq marks the company’s first move into serving the Middle East region, which covers a total of some 50 million consumers across several countries, as well as a relatively untapped market: only about two percent of all retail spend today is made online, according to a report from McKinsey.
Souq gives Amazon an immediate leg up rather than building a new service from the ground up: the company includes both a payments and fulfilment infrastructure, along with a marketplace that already has some 4 million products and works with thousands of merchants to help sell their goods online.
What I wrote last week still holds true:
Flipkart has its own internal turmoil to deal with, so it never made much sense that there were talks about such a large acquisition outside the Indian market. (Maybe it was in parts just to drive up the price Amazon would have to pay? Who knows.)
The real question though in all this is: Where the hell is Alibaba?
- Amazon to Acquire Middle Eastern Online Retailer Souq After All
- Who -Besides Alibaba- Can Challenge Amazon’s Tech Driven Online Retail Position?
- While Amazon Launches Prime in India, Flipkart-Owned Myntra Buys Jabong
- Fight for India: What Alibaba Plans Against Amazon
- How Flipkart Is Planning to Defeat Amazon: Cutting Costs & Getting Inspired by Jet.com
- Tiger Global Wants Flipkart to Be IPO-Ready By 2018/19. But What’s the Growth Strategy?
- Flipkart Is in Turmoil, as the Company Tries to Grow Up
- The Race Between Flipkart and Amazon is Getting Close