The Flipkart story
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ON A RETAIL HIGH: The Bansals, Binny (left) and Sachin.
A typical professional from a metro. recounts his first experience with Flipkart. So. accessibility to a variety of products makes audiences from smaller towns and cities opt for the online route. Often. convenience and a new relationship. and the journey for him has “just begun”. In the metros. he's short on time. “I felt Flipkart was the best option as the transaction was easy. and the variety of products was a bonus. a 26-year-old Project Executive from Mumbai. this humble seed of desire has germinated into a $100 million e-retailing favourite. both the Bansals. shortage of time is a big driver for online shopping. and it's a mantra they're applying successfully alright! E-commerce: Good to go? The concept of e-commerce is downloading at a fairly rapid pace in the psyche of the Indian consumer. and then at Amazon. is an ardent believer in the merits of customer service. and he's invariably seeking convenience. I usually prefer
. From an initial investment of $8.000. “why not start an e-commerce site?” That was the genesis of Flipkart. A quick glance at Flipkart's timeline shows it was to start as a price comparison platform. Flipkart has grown into a $100 million-revenue online retail giant in just five years.
TOPICS consumer goods electronic commerce retail
economy. On the other hand. Popular portals such as Flipkart are spearheading the conversion of offline shoppers into online bargain hunters. “For books. Adds Naveed. customers are unable to purchase items of their choice. Major retailers face challenges in stocking their stores adequately.
“It came to me as a Christmas gift from my Secret Santa. and it was all about choice. The founders' passion for the consumer Internet space manifests itself in the brand.com. who were colleagues at IIT-Delhi.” Sachin muses.” For Flipkart. business and finance company information
From a start-up with an investment of just four lakhs rupees. but there weren't enough e-commerce sites to compare. an e-voucher from Flipkart seemed an ideal fit. This gift marked his initiation into the sphere of e-commerce. which is synonymous with customer service and satisfaction. “A simple desire to create a tailor-made product for the Indian consumer has grown into something beyond what we imagined. this means the unlocking of a vast audience waiting to experience the joys and comfort of shopping online. thus prompting them to resort to e-retailers. Ushamrita Choudhury tracks the fairytale. So. as an afterthought. Many Indians today are embracing e-retailing with enthusiasm. CEO and one of the co-founders of Flipkart (the other being Binny Bansal). thought.” is how Naveed Ansari. „Don't count your customers before they smile' is the company's operating mantra. Sachin Bansal.
“The value proposition in either formats of retailing. it's often cheaper to buy online. “It's not like a 100-metre dash. in a way. a content writer from Raipur. a quick overview of India's Internet penetration shows a user base of approximately 100 million. Sales projection determines the inventory. and 55 languages. “We face significant challenges in reverse logistics. and the available inventory accounts for the sales made. one of India's earliest. as is the risk of failure. the scope for growth is immense. “Bigger investments in our supply chain and technology will enable larger warehouses and increased process automation. The acquisition of
. Yes. ‘Kart'apulting into the future Positive word-of-mouth gives Flipkart an edge on the customer side of the business.” There's still no formula for 100 per cent success. With several reputed brick-and-mortar retailers also offering online services. only seems logical. thus. Flipkart is running the marathon with ample support from private equity players such as Accel Partners and Tiger Global. Backstage.com will result in a faster expansion rate. and alliancing with like-minded businesses. Sachin reiterates. which prompts the question. “We've trained our customer service executives to take spot decisions. none of these issues can remain unresolved for long. This statement doesn't seem far-fetched. Addressing customer concerns and owning up to our mistakes reassure customers we have their best interests at heart. “still needs lots of investment to bolster its back-end. The files. The founders don't think discounts can replace the customer's satisfaction of being serviced promptly and efficiently. the books-to-electronics e-shop adopted the warehouse model. proposes to connect nearly 160 million additional Internet users by 2014. there is no history one can to refer to. As a customer-centric organisation. convenience and comfort takes over. it seems natural the trend of shopping remotely will scale up substantially. which are digital rights management (DRM) free. Flipkart connects with customers in real-time. “Nearly 60 to 70 per cent of deliveries take place through our own network. This practice. “We are open to partnerships that'll help us attain our goals. traditional or modern. By 2015. Japanese literature. In our business.shopping from physical stores. Although profits after tax remain negative. I'm definitely going to be a regular on their site. “All our efforts are invested in matching customers' expectations. Innovation is just one aspect of the business universe. K. and Founder and CEO. adds to the „surprise and delight' factor for customers. and maintains its own inventory. In the online context. he opines innovation is the key to the company's success. the company's valuation is soaring thanks to eager participation of these private equity players. Gathering and analysing data.” states Binny. which. Plus. and subsequent adoption of e-commerce. but so far. Such experiences explain the growing popularity of Flipkart in the non-metro regions as well. we want to clock in $1billion.” he signs off. but we're still seeing real growth. Flipkart began operations on the consignment model — goods were procured from suppliers on demand. Flipkart stresses on customer service — it aligns with the firm's philosophy of „making better our service promise'. Binny's long-term outlook includes scaling up the firm's self-delivery network.” Sachin articulates.” Like a typical entrepreneur. On the operational front. through Facebook and Twitter. Extending services like cash-on-delivery and credit card payment at doorstep were introduced to provide ample choice and comfort to customers. who thinks such a model provides for better control over the entire logistics management piece. Globally. The company has its own warehouses. because they're then treated to offers that are most suited and relevant to their preferences. which are quite costly to manage. Our bigger objective is to redefine the way India shops. it's this back-end that connects the dots.com. according to Sachin. we operate on the lowest margins. Today. Now. Flipkart's COO. Both the founders are happy to see increased venture capital participation in the e-commerce space. based on the orders received through the website. physical and online. issues faced by the company pertain to delay in deliveries. e-commerce veteran. honesty is the best policy for this ecommerce trailblazer. is different. since once the customer completes her transaction. the trust-building exercise is accorded a lot of importance.” Consistent customer service is the hallmark of Flipkart. pegged at $4. The spread. There's ample scope for both to grow. Vaitheeswaran. Their recent acquisition of Letsbuy.” he continues. with the potential to balloon to $70 billion by 2020. eventually. the attempt is to widen Flipkart's reach in the digital domain through Flyte. the premise of any business. hence. rests on its ability to harness data. Hence. we may be able to do it sooner. that's otherwise difficult to find. However. the story's no different. It's a big task to track unsuccessful orders. compares the vertical to a hard-fought marathon. or faulty products.” ent huses Riddhima Toshniwal.” states Sachin. it's a self-feeding cycle of sorts. but looking at present trends. how does Flipkart utilise its data to generate consumer insights? Since the industry is still in infancy.” In this industry. Indiaplaza. only Flipkart has managed to supply me with Manga.” Sachin avers. which have collectively invested $150 million in the entity so far. the portal's recently launched paid music download service. can be played without any restrictions on any type of device and for an unlimited number of times. Customers can buy music in MP3 format from over 700 genres. becomes crucial for planning the business's future course of action. “We will close 2011-2012 with over $100 million in revenue. Similarly. Binny pitches in saying.5 billion. The Government's National Broadband Plan. delivery drives delight. and we'll do our best to bring e-commerce into the forefront. It's the experience of touch-and-feel that makes physical shopping exciting. Consulting firm Technopak Advisors estimates India's digital economy at $600 million currently. The Devil lies in the detail A robust back-end is a vital pre-requisite for an online business to survive.
People are still pre-booking for this smartphone
. It added that the Moto G page alone saw 1 million page views on launch day while Flipkart’s total mobiles sales were five times that of its usual daily mobile sales. Edited excerpts from the interaction. coupled with a rising web-literate population and zealous venture capital funding may just propel Flipkart to become India's answer to Amazon.slideshare.net/himanshesh/flipkart-success-story-16376599#
Flipkart has been riding high since the launch of the new Moto G smartphone. He tweaks the famous MasterCard campaign to sound something like “There are some things you can't buy online… For everything else. It has been the fastest selling mobile phone for sure on Flipkart. According to Flipkart.Letsbuy. May be it is sheer genius. A burgeoning consumer class. while as much as 67 percent of its traffic was driven by Moto G. there's Flipkart!”
http://www. Only those companies that can successfully engage customers through novel ideas. the Moto G launch saw their traffic increase two-fold from normal days. We have run out of stock for the 16 GB version and we’ve put them on pre-order.
Response to Moto G? How has it been compared to say other smartphones that were also launched on the website in the past?
From a demand point of view. a marketing student from Pune. quality products and seamless services will flourish. which was launched exclusively on the retail website. Summing up the Flipkart experience. or simple common sense the e-retail hero has been able to accomplish all this during its formative years.com! Uncovering India's online avatar is a fascinating process. has dedicated an ode to the portal. Abhishek Asthana.
Firstpost spoke to Flipkart CEO Sachin Bansal on the success of the Moto G and the future of e-commerce in India. this has beaten all our expectations.com signals FlipKart's ambitions to capture the domestic online market.
We have already developed this capability of taking pre-orders and living up to to the expectations of the customers.
What kind of smartphones would you say tend to do well in online sales? Are budget smartphones outdoing premium ones online as well?
So what has happened is that the mid-segment has grown the fastest in India. had nearly 50. we are seeing what more products we can launch just online and will take a call on that. those are also available on Flipkart. But that
. We are watching the data closely for Moto G.Have other pre-orders and launches also done well in the past for Flipkart? Have non-electronics products also done well?
We have been running pre-orders in the past as well. it is the first time that a product is available only online.
Do you think it’s possible to repeat this kind of success with Moto G. We’ve seen pretty good numbers on pre-orders for books as well.000 books on day one itself. which are not necessarily says smartphones or electronics?
Well it is the first time that a brand like Motorola has done this. Just to give you an example of that. It’s not just the really cheap budget phones that have done well. This is the first time that we had an exclusive on a mobile phone. we’ve been doing pre-orders for all new releases in India. the book release of Amish Tripathi’s The Oath of the Vayuputras. where you do an exclusive launch with other products as well. In books for instance. and even for India. Of course if you want to buy an Android phone for Rs 3000 or Rs 4000.000 pre-orders and we delivered those 50.
what we’ve seen is that online shoppers are very aspirational.
Which two segments of products would say is expected to grow fastest in India where e-commerce is concerned? Which products is Flipkart expecting will grow the fastest?
We’ve positioned ourselves as a trustworthy place to shop from. you might see decent amount of sales.
Can you elaborate on how you’re looking at aspirational?
. So that’s where e-commerce comes and we’re seeing that aspirational products are doing well. because we don’t want to be seen as someone who’s cheating their customers. If you push out such products. we are also looking from a quality perspective. The mid-range smartphones have done very well for us. They have high aspirations and they want to own a well-developed product but at a cheaper price.segment doesn’t really do that well. rather than budget phones. but yes in the end we are happy to let that go.
From a segment point of view. So where products are concerned. We want to be known for quality products.000. which kind of starts at around Rs 10. because the quality of phones is not always that great. want to own a good quality smartphone. We don’t sell low-quality products at all.
Most people who aspire to own a smartphone.
we’re looking at some brands that tend to well such as Puma. in smartphones. of course Samsung is doing well. Metro shoppers have by and large taken to e-commerce but the tier-II and tier III is starting to grow. over half of the mobile users will shift to smartphones.
These are the two aspects that we really need to push on over the next few years in these markets. They will be a bigger driver of growth for e-commerce in India in the coming years. because broadband connections are still easier to get in larger cities but in smaller cities. or even other well-known brands of sports shoes. we’re seeing a lot of premium smartphones doing very well. Even as a category. we believe that over the next 5-6 years. Then in shirts brands like Peter England.
Which platform do you think will see bigger growth in these towns for ecommerce? Mobile or still desktops and PCs?
Mobile will be soon be a bigger proportion in those cities. There are two aspects for our strategy here. for instance when it comes to clothing. In electronics. Second is whether we have a service level which is up to a standard that is acceptable to the customers in those markets. One is to make sure that we have the products that those customers want. it’s less prevalent to used broadband.
Is there a particular strategy for tier II and tier III towns? What are the obstacles you see for growth in these cities?
These towns and cities are definitely the next level of growth.So. Also the way people are getting converted into smartphone users across the country.
We believe that a majority of customers in tier-II and tier-III cities will probably have a mobile only device and not even have a PC or desktop. We already have some examples of those and you’ll see more of that in the future. For them. the brick and mortar retailers. Offline retailers will come on the e-commerce marketplaces and sell their products online. to the growth of e-commerce players in India?
India’s market is so nascent from an organised retail point of view that I think there’s a huge scope of growth for both offline retailers and e-commerce platforms to grow. Internet access will only be on mobile and they will shop only from mobile.
Lastly what sort of reactions do you see from offline stores. You will see more and more partnerships between e-commerce platforms and offline retailers.