Flipkart, the Indian e-commercial company is going to acquire an online travel tech company called Clear trip for 40 million dollars, roughly 299.8 crore Indian Rupees.
It is however not clear whether this is the original amount or not but rumours call it as a giant deal of around forty million dollars for bolstering its presence in the online travelling domain that can make it to be the strongest competitors against Amazon
The deal was announced on Thursday on 15th of April, 2021 following an explanation on how this acquisition will help the company to grow in its business and revenues.
In a conformity with IBEF, the India Brand Equity Foundation, the expectancy for Indian in the sector of travelling and tourism is 6.7 percent to reach 35 Lakh crore Indian rupees, and for the accountancy, it shall be 9.2 percent of the total economy by 2029.
Ever since both the Flipkart and Amazon had been battling with each other regarding flight fare offers, bus as well as train bookings with the help of Cleartrip and MakeMyTrip, Flipkart seemed to be more aggressive in the competition. Though it was presumed to not settle for less, little did anyone knew it will acquire the partnering company so soon.
After the acquisition, Cleartrip however will continue to operate as a separate brand then what is the point of acquiring? Basically, as per the agreement made, Flipkart will not take away the entire company or brand. Instead, it will only acquire all the Cleartrip operations as well as it’s whole of the shareholding.
Kalyan Krishnamurthy, the Chief Executive of Flipkart replied with a statement that their company open heartedly welcomes the new teach that is of the Cleartrip as well as their deep industry knowledge and technological capabilities that shall improvise the deeper value and travel experiences for the customers.
In 2018, Flipkart partnered with MakeMyTrip to enable travel bookings on its platform. Later, in August 2019, Flipkart signed a deal with Gurugram-based Ixigo. Since then, the travel industry has faced an uphill struggle, with over a year of COVID-related restrictions having a huge impact on travel.
Stuart Crighton, the Chief and second brain behind Cleartrip, expresses his gratitude in becoming the part of Flipkart Group and family and upholds the collaboration as an affirmative decision in serving the travel industry.
Cleartrip was founded by Hrush Bhatt, Stuart Crighton and Matthew Spacie in the year 2006 as one of the first and biggest travel aggregator majorly competitive with MakeMyTrip and Ibibo. It also became the first Indian online travel agency to get featured on the Apple Watch in 2015. By the end of the year, the company had so much traffic from the application that by the month of May, 2016, about 75% of traffic for the company came all alone from the mobile-based app itself.
Cleartrip then later also started to headquarter in Dubai. This made them launch an Arabic version of its website in 2018 to grab the traffic and popularity from the rapidly growing Arabic community in the GCC region. The same year it brought an Alexa integration to let users book their flights and hotels using just the voice.
Flipkart on contrary, is headquartered in Bangalore and incorporated in Singapore. As of March 2017, the company holds a market share of 39.5% in the Indian e-commercial industry.
The acquisition of Cleartrip is nothing new to Flipkart as it has already dominated its position over Myntra, Jabong, other apparel segments. It also has ownership over PhonePe based on UPI (Unified Payments Interface, MapMyIndia, and eBay.in, the Indian subsidiary of eBay.
By bringing Cleartrip on board, Flipkart is directly stepping into the travel aggregators market that already has EaseMyTrip, Goibibo, MakeMyTrip, and Yatra, among others. The deal also comes at a time when people are avoiding travels due to the coronavirus spread.
The pandemic since 2020 triggered a significant increase in the number of online shoppers. The Indian e-commerce players such as Flipkart, Amazon, Myntra, Nykaa, etc., witnessed an unprecedented demand as millions of people turned to online shopping due to social distancing and lockdowns.