Walmart Inc. yesterday announced it had signed a definitive agreement with Flipkart Group to be the largest shareholder. Flipkart Group is an e-commerce firm based in Bengaluru in India. It’s a global leader in electronics and large appliances as well as mobile and fashion. Walmart will purchase an initial stake of approximately 77 percent of the company for $16billion. The remaining shares will be owned by existing investors such as co-founder Binny Bangsal, Tcent and Tiger Global. Walmart stated that the biggest ever deal will allow Flipkart to accelerate its customer-focused mission of transforming commerce in India by using technology. It also highlights Walmart’s commitment for sustained job creation in India, which is one of the fastest-growing and largest economies in the world. Flipkart will be able to leverage Walmart’s omnichannel retail knowledge, general merchandise supply chain knowledge, and financial strength. Meanwhile, Walmart will benefit from Flipkart talent, technology and customer insights. India regulators must approve the deal. Walmart and Flipkart will combine the strengths of both companies but they will still have their own brands and operating systems.
Total Retail Take: Flipkart’s investment is in line with Walmart’s goal to expand internationally, especially in countries with high long-term potential. Walmart’s purchase of Flipkart makes it the leader in e-commerce in India, which has more than 1.3 million people, strong GDP growth and a large middle class. It also increases its reach to a country with a significant number of smartphone users. Walmart anticipates that e-commerce will grow four times faster than overall retail in India. Flipkart has the unique ability to serve the needs of India’s growing online consumer base through its localized service, deep insight into Indian customers and best-in class supply chain. It also won the battle against Amazon.com for control of Flipkart.
Survey: Malls to Flourish, as Centers Tap into Experience-Led Shopping
In the last three months , more than half of America’s population has visited a shopping center. Americans expect that physical shops will continue to be the main source of their retail sales in the future. The priorities of shoppers are changing. Successful shopping centers are expanding beyond traditional retail to offer entertainment, services, and other activities to keep customers coming back.
Not only what you can purchase there will determine the future of shopping malls, but also what you have to say about them. American shoppers are visiting malls in large numbers — 165,000,000 in the last three months. But they are also going there to shop because of the variety of goods and entertainment available. This trend will be led by the best retail locations.
This is the clear message of the survey, which was commissioned by International Council of Shopping Centers. It surveyed more than 1,000 adults in February. Overall, the message is positive for both retail and retail realty. A majority of adults believe that physical stores will continue to be the main source of future purchases. A large percentage of Americans expect shopping malls will still exist in five and ten years. However, almost half of those adults believe that they will look different due to online-only retailers taking over physical space or renovation.
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This is no surprise, given the changes in retail. The retail experience has changed dramatically, with changes in the store mix and new food and entertainment options. The changes are overwhelmingly supported by Americans, with 70% of them agreeing that malls should provide engaging experiences for customers. This includes great shopping but also entertainment and services.
A majority of Americans agree that the shopping centers they visit keep their customers informed and fresh. A little over half of Americans believe that shopping malls and retail will be better off in the future. A little over two-thirds (26%) of Americans want malls to prosper, simply because they are valuable assets for their communities.
It is clear that there is a difference between reality and perception. Unexpectedly, 63 percent of Americans believe that an “e-retail apocalypse” is happening due to the growth of online shopping. However, the retail realty industry’s occupancy rate stands at 93.11%. Given the negative media coverage of the struggles of some retailers, it’s not surprising that the majority of Americans believe the industry is in trouble. However, a large majority of adults (66%) agree that retailers should be present in both physical and online locations.
This is exactly what is happening. Physical retail has a distinct advantage in both embracing omnichannel as well as providing the kind of in-store experiences consumers want. The future is driven by consumer tastes: 61% of Americans want physical retail to remain the same size, but to offer a wider range of products and to focus on providing “interactive brand experiences”, which can be used to support all shopping channels.
Surprisingly, three in four Americans want their retail stores to be diverse and vibrant, with a variety of services and retail — especially because it benefits their community when they have such shopping centers. Real estate agents and retailers agree that physical retail is more than just a shopping mall. Retail centers often feature live entertainment, farmer’s markets and craft fairs.
Since their inception, retail centers have been a key community hub. Shopping centers can be positioned to serve customers for many seasons by improving their customer experience.