AI/ML

Amazon Completes SOUQ Acquisition, Seeks to Empower Sellers with Technology

Amazon acquires Souq.com

Amazon has wrapped up another mega-acquisition within weeks of spending close to $14 billion to acquire Whole Foods in June. The Jeff Bezos-led cloud technology and e-commerce company confirmed that it has completed the acquisition of Dubai-based e-commerce marketplace, SOUQ.com, which is the largest e-commerce platform in the Middle East, and is often described as the ‘Amazon of the Middle East.’

Announcement Ends Months of Speculation

Earlier this year, Amazon had announced that it reached an agreement to acquire SOUQ for an undisclosed amount.

Russ Grandinetti, Senior Vice President, International Consumer at Amazon, had said,” Amazon and SOUQ.com share the same DNA – we’re both driven by customers, invention, and long-term thinking. 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’s technology and global resources. And together, we’ll work hard to provide the best possible service for millions of customers in the Middle East.”

Within days of announcing its interest in acquiring SOUQ, Amazon faced serious competition from other online retailers in the region, including EMAAR Malls PJSC. According to Bloomberg, the retail division of EMAAR offered close to $800 million to acquire SOUQ. However, SOUQ’s executive statement put all such speculation about its agreement with Amazon, to rest.

Amazon would Empower Sellers with New-Age Delivery Capabilities

Ronaldo Mouchawar, Co-Founder and CEO, SOUQ.com

Ronaldo Mouchawar, Co-Founder and CEO, SOUQ.com

SOUQ.com CEO and Co-Founder Ronaldo Mouchawar, said, “We are guided by many of the same principles as Amazon, and this acquisition is a critical next step in growing our e-commerce presence on behalf of customers across the region. By becoming part of the Amazon family, we’ll be able to vastly expand our delivery capabilities and customer selection much faster, as well as continue Amazon’s great track record of empowering sellers.”

Amazon’s massive drive to penetrate into new markets is pushing the boundaries of e-commerce, making them the world’s biggest retailer (twice as large as Wal-Mart).

By virtue of its algorithmic data-driven approach to present relevant products and recommendations to customers, Amazon is redefining the “art and science of shopping.” Amazon’s incredible growth and swift expansion into new channels and markets earned it the tag of “Death Star“, threatening the behemoths of traditional online shopping.

Competitors need to Buck Up

By completing the acquisition of Whole Foods and SOUQ in quick succession, Amazon is set to build a massive distribution network and physical stores. Amazon’s innovation and mastery at implementing new technologies over the web, social, mobile, augmented reality and virtual reality could drive sales and customer engagement across online as well as brick-and-mortar stores.  These acquisitions allow Amazon to deliver “auto shopping” experiences based on all the customer data collected from various online platforms.

Providing an apt insight into the current dynamics of e-commerce, marketing expert Chris H. Petersen wrote in a blog, “The rest of retail has entered the age where their greatest threat is not Amazon per se. The greatest threat for all retailers is one of “death by mediocrity”.

SOUQ’s acquisition shows just how high Amazon has set the bar in the e-commerce sector.

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