Wait a second! Just last week I wrote on the race for global dominance between Amazon and Alibaba.  And shame on me for not even mentioning Walmart, especially since I’ve been on a rant about how Walmart is rapidly becoming Amazon’s biggest headache. And now they are about to give Amazon a migraine in the only big ecommerce market still up for grabs: India. Alibaba owns China and Amazon owns the U.S. (albeit looking over their shoulder as the behemoth bears down on them). But India is where these two giants are squaring off.

In review: Millennials make up a third of India’s population giving the country the highest growth potential in the region. According to research conducted by Morgan Stanley, in 2009 the online market in India totaled $3.9 billion. In 2016, it had jumped to $15 billion, and they project it will soar to $200 billion in 2026. According to a report by consulting firm Praxis Global Alliance, Flipkart, including its fashion unit Myntra, is the market leader in India with about a 45 percent share, while Amazon has about a 35 percent share. Snapdeals in India has a minor share and is being eyed by Flipkart as a potential acquisition candidate. Alibaba is a late entrant, and according to CB Insights, they may be in the very early stages of building a super app that will allow it to combine all of its various assets, resembling Tencent’s WeChat app. But currently, Alibaba is only a side show. Amazon and Walmart are battling it out in center ring in this circus.

Amazon and Walmart are both bidding for a stake in Flipkart, valued at around $20 billion (it was launched in 2007 and has yet to be profitable). According to people familiar with the bidding battle, Walmart is a “nose” ahead, intending to acquire a majority stake in Flipkart (it could end up being 50-60 percent) with the objective of increasing Flipkart’s share of market and maintaining its lead over Amazon, thus giving Walmart dominance in the market.

Walmart appears to be favored to win for several reasons.

Out of the box, since Amazon already has the second largest share of ecommerce in India at around 35 percent, they would face major regulatory barriers. Walmart would not (due to their lack of an online presence).

There’s a bit of irony in this move. Walmart has been trying to establish an offline retail business in India for over a decade, but it has been denied because of government regulations protecting India’s mom-and-pop shops. They tried with an offline partner, Bharti Enterprises, but it failed. So, the best toehold Walmart has been able to establish is a chain of 21 Best Price wholesale stores.

Another element that favors Walmart is that Flipkart’s non-strategic investors might find Walmart the most attractive cash-out opportunity and/or best strategic buyer that can provide synergies and more sustainable growth, both online and off. ·One fly in the ointment might be eBay’s $500 million investment for a five percent stake in Flipkart and a four-year exclusive agreement, according to an article in Recode.  So, even if Walmart does acquire a majority stake in Flipkart, as eBay’s deal now stands they would be operating alongside Walmart on the site. Maybe that’s okay with Walmart, maybe not. However, one expert close to the pending Flipkart/Walmart deal believes the behemoth will end up getting what the behemoth wants. I would go with that reasoning. And who knows? Maybe Walmart will find some kind of synergy with eBay, or just let them run out of the four-year contract.

• Flipkart founders Sachin and Binny Bansal favor Walmart because they would keep their jobs and continue with their personal commitment to the market.
• With a majority stake in Flipkart, Walmart also brings its substantial offline retail expertise and can start a new physical retail move. By default, Flipkart also gains expansion into the offline market.
• Flipkart will benefit from Walmart’s omnichannel expertise in the U.S. leveraging the synergy of physical and digital creating a multi-purchasing and distribution platform.
• And finally, the Jet.com knowledge and framework has an edge over Amazon with its “smart basket” expertise. This algorithmic formula for the most efficient, lowest priced basket of goods is beginning to gain traction in the U.S., and is considered a competitive advantage over Amazon.
• While Flipkart does not need help in its fashion categories and mobile expertise, Walmart can add value in grocery and hundreds of thousands of basic, daily household goods. Walmart also has a huge number of private label brands to add to the equation in all product categories.

A major advantage that Amazon has had over Flipkart is Amazon Prime with millions of members. To be competitive, Walmart would likely provide a Sam’s Club offering with two membership tiers: one at $100 annually and the other at $45. While Walmart offers this membership program only offline in the U.S., it has been successfully launched in China online with Walmart’s partner, JD.com. Full disclosure, the jury is still out on its relative success.

Who Will Win Flipkart?

At the end of the day, Walmart needs Flipkart more than Amazon. But Mr. Bezos is a competitive guy and no doubt hopping mad that Amazon lost in China against Alibaba, and Walmart has been able to gain ground there through its partial ownership of JD.com. This could take a while. Both Amazon and Walmart have deep enough pockets to withstand a withering bidding war.

However, I don’t believe this is a case of the highest bidder takes all. I believe the government’s regulatory barriers and Flipkart’s leaders and investors favor a Walmart win.

But, I will never rule out Amazon and its aggressive strategy to take over the world. Amazon never ceases to amaze in surprising and awesome ways.