Monday, August 6, 2012

Apple Inc (NASDAQ:AAPL) May Buy E-Commerce Newbie The Fancy

The latest buzz according to Business Insider is that Apple Inc.(NASDAQ:AAPL) is planning to own The Fancy, a fast-growing social commerce website that is Facebook Inc(NASDAQ:FB) by Facebook and Twitter.

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So what is the motive here? Apparently, Apple wants to secure a place in the evolving e-commerce market. This venture would put 400 million users, who own credit cards, in sync with Apple’s iTune Store. Apple will clearly get a cut of the action.

In contrast to archrival Pinterest, The Fancy is small and allows users to enlist all the things that interest them. It is a New York-based start-up involving 20 people and led by CEO and co-founder Joe Einhorn. The Fancy is leaving no stones unturned in linking its users to transactions. The website takes a 10% cut of purchases. The sales are blowing up.

However, there is no news of any signed deal or guarantee of the venture. Also, the price that Apple has probably offered The Fancy is not known. On the other hand, it is absolutely not a coincidence that Apple CEO Tim Cook and Einhorn had met at Allen & Co.’s Sun Valley conference recently. It came as a surprise that shortly afterwards Cook, who maintains an extremely private life, started using The Fancy.

Apple does not have a reputation of making splashy acquisitions. However, from a source that is well-versed with the tech giant’s acquisition strategy has mentioned that it is a situation when Apple is likely to buy other companies.

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Then, there comes another question. How a 2-year old company with a handful of employees possible benefit Apple in any way? Apple has an e-commerce history that is around 15 years old when it had opened its first online store. All its early ventures had contributed in rolling out iPhone’s App Store and iTunes Store.

The Fancy may guide Apple with a clear route to convert interests of users into sales. 

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