Flipkart, which competes with Amazon in India, is doubling down on an area where it has established a clear lead: Fashion.
On Thursday, the Flipkart Group announced it had invested $35 million in Arvind Fashions for a significant minority stake in one the decades-old Indian firm’s subsidiaries as the Walmart -owned firm looks to tighten its grip on fashion apparels in the world’s second largest internet market.
Through acquisition of Myntra and Jabong over the years, Flipkart has already established dominance in India’s fashion e-commerce market. The company said today it was acquiring a stake in Arvind Fashions‘ Arvind Youth Brands, which operates Flying Machine brand in India.
The two companies said the new investment strengthens their partnership as they look to serve demands and needs of the “fashion-conscious youth” in India. Arvind Fashions began selling items on Flipkart six years ago.
91-year-old Arvind Fashions runs of the nation’s largest fashion brands, and also manufactures and carries apparels of international brands including Polo Assn, Arrow, GAP, Tommy Hilfiger, Calvin Klein, Aeropostale, the Children’s Place and Ed Hardy among other local and international firms.
The investment comes at a time when both Flipkart and Amazon have been expanding their private labels ecosystem in India. And by courting Arvind Fashions, Flipkart could look to replicate a similar strategy in the fashion space. The Indian e-commerce market for fashion products was worth $7 billion last year, research firm Forrester told TechCrunch.
“Flying Machine is a brand that is known in households across India, popular with the youth and synonymous with value and style. Through this investment, we look forward to partnering with the team at Arvind Youth Brands to continue to grow the market for its portfolio of products and enhance the strong brand equity that has been built over the last few decades,” said Kalyan Krishnamurthy, chief executive officer of Flipkart Group, in a statement.
The partnership with the Flipkart Group is aimed at helping Arvind Fashions accelerate its online growth strategy, said J. Suresh, managing director and chief executive of Arvind Fashions.
“Given the strong existing relationship with the Flipkart Group, and their presence in online fashion, it was an obvious choice for us to enter into this engagement through which Flipkart and Myntra will be our preferred online partner for the Flying Machine brand, while we continue to grow our offline sales through channels like exclusive brand stores, department stores and multi-brand stores,” he said in a statement.
More to follow…