RetailTechNews’ weekly Amazon Watch brings you some of the company’s biggest moves from the past seven days, analysing how the giant is revolutionising the retail space. In this week’s edition: Trump vs Amazon; Game of mergers; and Amazon to rival Walmart’s Flipkart bid.

Trump vs Amazon

Amazon and Donald Trump are at war again, after the American President claimed that the U.S. Post Office loses USD$1.50 (£1.07) on average for each package it delivers for Amazon.

The attacks have seen Amazon’s share price fall in recent days, amid concern that he might push for its power to be curbed by anti-trust laws. Trump tweeted: “If the P.O. 'increased its parcel rates, Amazon's shipping costs would rise by $2.6 Billion.' This Post Office scam must stop. Amazon must pay real costs (and taxes) now!"

Whether the rate of increase would be this dramatic or not, if the U.S. government intervenes, and Amazon is forced to pay higher shipping costs, the face of the retail market could change dramatically. At the moment, Amazon can price most of their competition out of the market.

However, if shipping costs are increased, some of this hike will make its way to consumers, causing the pricing of items on Amazon to increase. Although the company will still have market-leading speed and convenience, the ability to price-match Amazon will give retailers a better foothold in the industry, increasing competition rates.

Game of mergers

Target and Kroger are discussing a possible merger, amid Amazon’s increasing hold on the retail market. The two companies first started conversations last summer about a partnership that could improve Target’s grocery business and give Kroger customers more access to merchandise and e-commerce.

Amazon’s acquisition of Whole Foods has forced many retailers’ hands in terms of mergers and acquisitions aimed at improving their digital offerings, and wrestling back a bit of market share from the behemoth.

U.S. grocers including Kroger, Albertson’s, Publix, and Ahold Delhaize struck deals with Instacart to give their supermarkets a digital presence and provide on-demand delivery to their customers. Albertson’s also purchased meal-kit purveyor Plated.

Amazon’s chokehold on the retail industry shows no signs of easing up, so it is likely the next year will see more M&A activity in the space, as traditional retailers look to up their online capabilities. Mergers of e-commerce pureplays and brick-and-mortar retailers will help both stay afloat, as Amazon hunts their market share.

Amazon to rival Walmart’s Flipkart bid

Amazon may make a rival offer to buy Indian e-commerce firm Flipkart, which is also in talks with Walmart. The news comes as the two companies jostle for dominance in India’s booming e-commerce industry.

A deal with Walmart would give the world's largest brick-and-mortar retailer access to an e-commerce market that Morgan Stanley estimated to be worth USD$200bn (£142bn) in a decade's time.

On the other hand, a deal with Amazon, which looks less likely, would spark concerns over a monopoly, as Amazon and Flipkart currently dominate the online market in India. Amazon has committed to invest USD$5bn (£3.5bn) in India to expand its online grocery delivery offerings.

Any deal between Flipkart and Amazon would be a body blow to Walmart, that is taking a beating from Amazon in the U.S. e-commerce market, and saw an investment in Flipkart as an opportunity to take on Amazon on a new battle ground. This content was originally published in RetailTechNews.