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COMPARATIVE AND MARKETING

STRATEGY OF
SNAPDEAL AND FLIPKART

vs

GOKAVALASA DINAKAR
ROLL NO 20130114
PGDM (2013- 2015 )
DATE :

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TABLES OF CONTENTS
Page No
I.

INTRODUCTION ............................................................................. 3
FLIPKART .............................................................................. 7
II.

PROFILE OF FLIPKART .................................................................. 8

III. OVER VIEW OF FLIPKART............................................................. 12


IV. MARKETING STRATEGY OF FLIPKART ..................................... 16
SNAPDEAL ............................................................................... 30
V.

PROFILE OF SNAPDEAL................................................................. 31

VI. OVER VIEW OF SNAPDEAL............................................................ 34


VII. MARKETING STRATEGY OF SNAPDEAL.................................... 36
VIII. COMPARATIVE ANLAYSIS OF FLIPKART AND SNAPDEAL....... 42
IX.

CONCLUSION ....................................................................................... 51

X.

ACKNOWLEDGEMENT ....................................................................... 53

XI.

BIBLIOGRAPHY .................................................................................. 54

INTRODUCTION
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FLIPKART:
Things are easier said than done! To realize our dreams and that also in such a
grand manner is really a tough task. The founders of Flipkart have probably conquered their
dreams with the amazing success of Flipkart. Flipkart is something which has really opened
up the Indian e-commerce market and that also in a big way.
Flipkart was co-founded by Sachin Bansal and Binny Bansal in Oct 2007. Both
are graduates from IIT-Delhi and have prior work experience in Amazon.com They both
were solid coders and wanted to open a portal that compared different e-commerce websites,
but there were hardly any such sites in India and they decided to give birth to their own ecommerce venture - Flipkart.com.
Thus was born Flipkart in Oct 2007 with an initial investment of 4 lac (cofounders savings). It was never going to be easy since India has had bad past experiences
with e-commerce trading. It was not an easy segment to break into, people were very
particular in paying money for something which they had not seen and received. The trust
was missing in the Indian customers. So what Flipkart had to do was to instill trust and faith
in their customers. And they did exactly the same, will discuss more on how they did so later
in the post.
Flipkart began with selling books, since books are easy to procure, target market
which reads books is in abundance, books provide more margin, are easy to pack and
deliver, do not get damaged in transit and most importantly books are not very expensive, so
the amount of money a customer has to spend to try out one's service for one time is very
minimal. Flipkart sold only books for the first two years.
Flipkart started with the consignment model (procurement based on demand) i.e.
they had ties with 2 distributors in Bangalore, whenever a customer ordered a book, they
used to personally procure the book from the dealer, pack the book in their office and then
courier the same. In the initial months the founder's personal cell numbers used to be the
customer support numbers. So, in the start they tried their best to provide good service, focus
on the website - easy to browse and order and hassle-free, and strove hard to resolve any
customer issues. Since there were not any established players in the market, this allowed
them a lot of space to grow, and they did in fact grew very rapidly.

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Flipkart had a revenue of 4 crore in FY 2008 - 2009, 20 crore in FY 2009 - 2010,


75 crore in FY 2010 - 2011, and the revenue for FY 2011 - 2012 which ends on 31 Mar 2012
is expected to be 500 crore. This is indeed a massive growth. The company targets revenues
of 5000 crore by 2015. he company started from 2 employees and now has around 4500
employees.
Flipkart started with consignment model as discussed above, since most of the
customer issues like delivery delays etc. result from procurement model, the company
started opening its own warehouses as it started getting more investments. The company
opened its first warehouse in Bangalore and later on opened warehouses in Delhi, Kolkatta
and Mumbai. Today the company works with more than 500 suppliers. As on date more than
80% orders of Flipkart are handled via warehouses which help in quick and efficient
service.
A humble beginning from books, Flipkart now has a gamut of products ranging
from: Cell phones, laptops, computers, cameras, games, music, audio players, TV's,
healthcare products, washing machines etc. etc. Still, Flipkart derives around 50% of its
revenue from selling books online. Flipkart is the Indian market leader in selling books both
offline and online, it enjoys an online share of around 80%. The electronic items have a large
number of players like Naaptol, Letsbuy, Indiaplaza, Tradus, Infibeam, Yebhi etc. The
electronic market share is distributed among them in different unknown proportions.
India has around 13.5 crore internet users today where as the number of homes
with Cable and Satellite (C&S) television is 10.5 crore. The expected internet users will
reach a figure of 30 crore by 2014 and C&S homes are expected to be 14 crore by 2014.
Thus India has a tremendous internet growth and with the customers getting accustomed to
e-commerce, the future of e-commerce sector is definitely rosy. An approximated 25 lac
people have transacted online this year, the number is all set to increase with time.
Also to mention most of the Flipkart customers use internet from PC's/Laptops to
order goods. The use of mobile internet is very less at the moment, but with the advent of
smart phones the use of mobile internet for e-commerce transactions will soar with time.
India has 8 crore mobile net users at the moment, the number is expected to swell to 22.5
crore by 2014.
In the financial year 2008-09, Flipkart had made sales to the tune of 40 million
Indian rupees. This soon increased to 200 million Indian rupees the following year.
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Flipkart targets to hit the one billion mark by 2015. Going by their ever increasing
popularity, it does not seem like a farfetched thought.
Back at the time when Flipkart was launched, any e-commerce company faced
two major difficulties. One was the problem of online payment gateways. Not many people
preferred online payment and the gateways were not easy to set up. Flipkart tackled this
problem by introducing cash on delivery and payment by card on delivery in addition to
others.
The second problem was the entire supply chain system. Delivering goods on
time is one of the most important factor that determines the success of an ecommerce
company. Flipkart addressed this issue by launching their own supply chain management
system to deliver orders in a timely fashion.
Flipkart also acquired few companies like Myntra.com, LetsBuy.com etc., to
better their presence in the market. With the entry ofAmazon.com in India, the competition
between the companies has seen many takeovers.
Flipkarts journey from a small book e-retailer to Indias largest ecommerce platform inspires a generation of start-ups. In a country where stereotypes are
common, Flipkart managed to break the norm and change the ecommerce industry in India
for ever. Flipkarts story proves that if you have a great idea, and you are a doer and not a
thinker, success is not far off.

SNAPDEAL:
It is never easy to start a business. You need to work on your ideas, find capital
and investors and then you need to work hard to get results. Ask those who have succeeded,
they tell you it is the best feeling ever when an idea takes off to places. Snapdeal set a niche
for itself in the sphere of e-commerce in India.
In 2010, when Kunal Bahl and Rohit Bansal wanted to start their own business,
they chose an offline couponing business and named it Money Saver. 15000 coupons were
sold in three months and it was time to take the business to the next level.
It was after they met investor Vani Kola that the venture really took off. The first
meeting did not go well but after another round of discussion, Vani Kolas venture capital
firm decided to invest in Snapdeal.
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Initially started as an offline business, Sneapdeal went online in 2010. It was a


bumpy ride in the first few months. Mistakes were made, but lessons were learnt. It is this
kind of hard work and diligent attempt to offer the best to the customers that gave Snapdeal
its initial success.
However, the biggest decision of the founders came in November 2011. Inspired
by the success of Alibaba.com, Rohit and Kunal wanted to create something on similar
lines. The deals business was shut down and an online marketplace was opened instead.
It was a make or break decision. Snapdeal had a huge market share in the deals
business at that time and starting something new was very risky and the move surprised the
investors too. At that point of time, eBay was the only marketplace in India.
It was a decision that was not for the short term. When Rohit Bahl managed to
gain the nod the board, the present form of Snapdeal took shape. The very fact that Snapdeal
is valued at a billion dollars today is a testimony to the vision of its founders.
Currently, more than 50,000 sellers sell around 5 million products on Snapdeal.
The companys phenomenal growth in a short span has been a remarkable journey. The
company began to concentrate on building scale and improving speed. When eBay invested
in Snapdeal, they brought immense experience to the table.
Snapdeal is one of the fastest growing e-commerce companies in India today
with the largest online market place. In just two years, the company went from scrapping
their group coupon business and starting an online marketplace to become a billion dollar
company. Its year on year growth is almost 600%.
The average age of the workforce at Snapdeal is 25. Their values Innovation,
Change, Openness, Honesty and Ownership drive them to press for greater success. The
companys growth had been phenomenal but it is their continued effort to bring the best to
the market and their zeal to succeed as the best B2C (Business to customer) marketplace is
what sets them apart.

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PROFILE OF FLIPKART
Flipkart, is an E-Commerce company established in 2007 by Sachin Bansal and
Binny Bansal. It operates exclusively in India, with headquarters at Bangalore,Karnataka.
Flipkart has launched its own product range under the name " DigiFlip " with products
including tablets, USBs, and laptop bags. Flipkart also has its own range of personal
healthcare and home appliances under the brand "Citron" and apparels under the brand
"Flippd".
In May 2014, Flipkart received $210 million from DST Global and in July it
raised $1 billion led by existing investors Tiger Global and South Africa's media group
Naspers. Flipkart's last fundraising round in December had pegged its valuation at $12
billion.

HISTORY OF FLIPKART :
Flipkart (Company) was founded in 2007 by Sachin Bansal and Binny Bansal,
both alumni of the Indian Institute of Technology Delhi. They had been working
for Amazon.com previously. The business was formally incorporated as a company in
October 2007 as Flipkart Online Services Pvt. Ltd.During its initial years, Flipkart focused
only on books, and soon as it expanded, it started offering other products like electronic
goods, air conditioners, air coolers, stationery supplies and life style products and e-books.
The first product sold by them was the book Leaving Microsoft To Change The World,
bought by VVK Chandra from Andhra Pradesh. Flipkart now employs more than 16000
people. Flipkart allows payment methods such as cash on delivery, credit or debit card
transactions, net banking, e-gift voucher and card swipe on delivery.

ACQUISITIONS :

2010: We Read, a social book discovery tool.

2011: Mime360, a digital content platform company.

2011: Chakpak.com, a Bollywood news site that offers updates, news, photos and
videos. Flipkart acquired the rights to Chakpak's digital catalogue which includes 40,000
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filmographies, 10,000 movies and close to 50,000 ratings. Flipkart has categorically said that
it will not be involved with the original site and will not use the brand name.

2012: Letsbuy.com, an Indian e-retailer in electronics. Flipkart has bought the company
for an estimated US$25 million.Letsbuy.com was closed down and all traffic to Lets buy has
been diverted to Flipkart.

2014: Acquired Myntra.com in an estimated 20 billion (2,000 crore, about US$319


million) deal.

FINANCE :
Initially, the founders had spent 400,000 only for making website to set up the
business. Flipkart has later raised funding from venture capital funds Accel India (US$1
million in 2009) and Tiger Global (US$10 million in 2010 and US$20 million in June
2011).On 24 August 2012, Flipkart announced the completion of its 4th round of $150
million funding from MIH (part of Naspers Group) and ICONIQ Capital. The company
announced, on 10 July 2013, that it has raised an additional $200 million from existing
investors including Tiger Global, Naspers, Accel Partners and Iconiq Capital.
Flipkart's reported sales were 40 million in FY 20082009, 200 million
in FY 20092010 and 750 million for FY20102011. In FY 20112012, Flipkart is set to
cross the 5 billion (US$100 million) mark as Internet usage in the country increases and
people get accustomed to making purchases online. Flipkart projects its sales to reach 10
billion by year 2014. On average, Flipkart sells nearly 10 products per minute and is aiming
at generating a revenue of 50 billion (US$0.81 billion) by 2015.
On November 2012, Flipkart became one of the companies being probed for
alleged violations of FDI regulations of the Foreign Exchange Management Act, 1999.
Flipkart reported a loss of 281 crore for the FY 2012-13. In July 2013, Flipkart
raised USD 160 million from private equity investors.
In October 2013, it was reported that Flipkart had raised an additional $160
million from new investors Dragoneer Investment Group, Morgan Stanley Wealth
Management, Sofina SA and Vulcan Inc. with participation from existing investor Tiger
Global.
On 26 May 2014, Flipkart announced that it has raised $210 million from Yuri
Milners DST Global and its existing investors Tiger Global, Naspers and Iconiq Capital.
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In early July 2014, it was also highly speculated that Flipkart was in negotiations
to raise at least $500 million, for a likely listing in the US for 2016.
On 29 July 2014, Flipkart announced that it raised $1 billion from Tiger Global
Management LLC, Accel Partners, and Morgan Stanley Investment Management and a new
investor Singapore sovereign-wealth fund GIC.
On 6 October 2014, Flipkart sold products worth INR 650Crore in 10 hours in a
special one-day event - "The Big Billion Day", claiming they had created e-commerce
history, but their hard-won reputation for good customer service suffered because of
technical problems, and angry reactions on social media from buyers disappointed with the
pricing and availability of products. It claimed to sell a whopping 5 lakh mobile handsets,
five-lakh clothes and shoes and 25,000 television sets within hours of opening its discounted
sale at 8 AM. In December 2014, After it received $700 million from another funding,
Flipkart had a market cap of $11 billion or Rs.66000 crore.
On 20 December 2014, Flipkart announced filing application with Singapore
based companies' regulator ACRA to become a public company after raising USD 700
million for long term strategic investments in India following which its number of investors
exceeded 50. The USD 700 million fund raised by Flipkart added new investors - Baillie
Gifford, Greenoaks Capital, Stead view Capital, T. Rowe Price Associates and Qatar
Investment Authority - on company's board. Its existing investors DST Global, GIC,
ICONIQ Capital and Tiger Global also participated in this latest financing round.

FLYTE DIGITAL MUSIC STORE :


In October and November 2011, Flipkart acquired the websites
Mime360.com and Chakpak.com. Later, in February 2012, the company revealed its new
Flyte Digital Music Store. Flyte, a legal music download service in the vein of iTunes
and Amazon.com, offered DRM-free MP3 downloads. But it was shut down on 17 June
2013 as paid song downloads did not get popular in India due to the advent of free music
streaming sites.

EXCLUSIVE PRODUCT LAUNCHES :


Motorola Mobility, previously owned by Google but then sold to Lenovo, in an
exclusive tie up with Flipkart launched its budget smart phone Moto G in India on 5
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February 2014. This triggered an overwhelming response from online shoppers and more
than 20,000 units were sold within hours of launch on Flipkart.
After the Moto G successful debut launch, Flipkart was looking for a long term
tie up with Motorola Mobility. The Moto G success story, led to another exclusive tie up
between Flipkart & Motorola Mobility, who launched their flagship Android smart phone,
the Moto X on 19 March 2014. After Moto G and Moto X, Flipkart invited the Moto E, the
newest member of Moto family which is even cheaper than Moto G on 13 May 2014.
The sale of high-end smart phone Xiaomi Mi3 produced by Xiaomi Tech was
launched in India on an exclusive tie-up with Flipkart. The first batch was sold out within 39
minutes on 22 July 2014, the second in 5 seconds on 29 July 2014. The sale was proceeded
on pre-registration mode where more than 150 000 buyers booked for the 5 August 2014
sale. This got sold off in less than 2 seconds. Following this Xiaomi Tech decided to sell
20,000 pieces in the next sale scheduled for 12 August 2014. On September 2, 2014 Flipkart
held a flash sale of the budget Android smart phone the Xiaomi Redmi 1S which was
launched in India in July 2014. 40, 000 units priced at Rs 5999 each were sold within
seconds. In the second round of Xiaomi Redmi 1S sale held on Sept 9, 2014, 40,000 units
were sold within a span of 4.5 seconds, slightly longer than the first sale, which lasted just
4.3 seconds. Third round of Redmi 1S sale held on Sept 16, 2014 with again 40,000 units
sold in fastest of all 3.4 seconds. In the 4th round of sale of Redmi 1S held on Sept 23, 2014,
Flipkart put more units this time, 60,000 units go out of stock in 5.2 seconds. In the latest
Flash sale held on Sept 30, 2014, once again 60,000 units Go out of stock in 13.9
seconds. Redmi Note in India exclusively through Flipkart.
The first flash sale of 50,000 Redmi Note devices held on December 2, 2014 and
all the devices sold out in mere 6 seconds, just like all the earlier flash sales of Xiaomi held
at Flipkart.

IN HOUSE PRODUCTS:

In July 2014 Flipkart launched its own set of tablet, mobile phones & Phablet. The first
among these series of tablet phones was Digiflip Pro XT 712 Tablet.

In July 2014 Flipkart launched its first networking router, under its own brand name
named DigiFlip WR001 300 Mbit/s Wireless N Router.

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In September 2014 Flipkart launched its in-house home appliances and personal
healthcare brand Citron. The label includes a wide range of cooking utilities and grooming
products.

CRITICISM :
Flipkart is a Singaporean company with multiple Indian shell companies to run
an India focused operation. The Indian shell companies is used to funnel funds to the parent
Singaporean company.
On 6 October 2014 Flipkart launched Big Billion Day with intention to increase
the popularity by targeting billion sales in 1 day. This even though helped Flipkart achieve
the target led to public outcry and widespread criticism across consumers, competitors and
partners heavily damaging its reputation.
Many users could not place the order because the servers were not capable
enough to take the load and was giving random errors to users which led to frustration
among customers. Many users who placed orders got email saying that the order got
cancelled. Most of the products were sold for price less than cost price and was accused of
killing the competition. Major competitors filed complaints against Flipkart to commerce
ministry claiming that selling products for less than cost price is against the commerce
policy of the country. Ministry said that they will form new trade rules for e retail after this
incident.
On 13 September 2014 a Flipkart delivery boy molested a house maid in
Hyderabad. The house maid's employer has been fighting against Flipkart for justice on this
issue, and also for making offline delivery services safe.

AWARDS & RECOGNITION :

Co-Founder of Flipkart Sachin Bansal, got Entrepreneur of the Year Award 2012-2013
from Economic Times, leading Indian Economic Daily.

Flipkart.com was awarded Young Turk of the Year at CNBC TV 18's 'India Business
Leader Awards 2012' (IBLA).

Flipkart.com- got Nominated for IndiaMART Leaders of Tomorrow Awards 2011.

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OVER VIEW OF FLIPKART


Flipkart was co-founded by Sachin Bansal and Binny Bansal in Oct 2007. Both
are Graduates from IIT-Delhi and have prior work experience in Amazon.com They both
were solid coders and wanted to open a portal that compared different e-commerce websites,
but there were hardly any such sites in India and they decided to give birth to their own ecommerce venture - Flipkart.com
Thus was born Flipkart in Oct 2007 with an initial investment of 4 lac (cofounders Savings). It was never going to be easy since India has had bad past experiences
with e-commerce trading.
It was not an easy segment to break into, people were very particular in paying
money for something which they had not seen and received. The trust was missing in the
Indian customers. So what Flipkart had to do was to instill trust and faith in their customers.
And they did exactly the same, will discuss more on how they did so later in the post.
Flipkart began with selling books, since books are easy to procure, target market
which reads books is in abundance, books provide more margin, are easy to pack and
deliver, do not get damaged in transit and most importantly books are not very expensive, so
the amount of money a customer has to spend to try out one's service for one time is very
minimal. Flipkart sold only books for the first two years. Flipkart started with the
consignment model (procurement based on demand) i.e. they had ties with 2 distributors in
Bangalore, whenever a customer ordered a book, they used to personally procure the book
from the dealer, pack the book in their office and then courier the same. In the initial months
the founder's personal cell numbers used to be the customer support numbers. So, in the start
they tried their best to provide good service, focus on the website - easy to browse and order
and hassle-free, and strove hard to resolve any customer issues. Since there were not any
established players in the market, this allowed them a lot of space to grow, and they did in
fact grew very rapidly.
Flipkart had a revenue of 4 crore in FY 2008 - 2009, 20 crore in FY 2009 - 2010,
75 crore in FY 2010 - 2011, and the revenue for FY 2011 - 2012 which ends on 31 Mar 2012
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is expected to be 500 crore. This is indeed a massive growth. The company targets revenues
of 5000 crore by 2015.
The company started from 2 employees and now has around 4500 employees.
Flipkart started with consignment model as discussed above, since most of the customer
issues like delivery delays etc. result from procurement model, the company started opening
its own warehouses as it started getting more investments. The company opened its first
warehouse in Bangalore and later on opened warehouses in Delhi, Kolkata and Mumbai.
Today the company works with more than 500 suppliers. As on date more than 80% orders
of Flipkart are handled via warehouses which helps in quick and efficient service.
A humble beginning from books, Flipkart now has a gamut of products ranging
from: Cell phones, laptops, computers, cameras, games, music, audio players, TV's,
healthcare products, washing machines etc. etc. Still, Flipkart derives around 50% of its
revenue from selling books online. Flipkart is the Indian market leader in selling books both
offline and online, it enjoys an online share of around 80%. The electronic items have a large
number of players like Naaptol, Letsbuy, Indiaplaza, Tradus, Infibeam, Yebhi etc. The
electronic market share is distributed among them in different unknown proportions.
India has around 13.5 crore internet users today where as the number of homes
with Cable and Satellite (C&S) television is 10.5 crore. The expected internet users will
reach a figure of 30 crore by 2014 and C&S homes are expected to be 14 crore by 2014.
Thus India has a tremendous internet growth and with the customers getting accustomed to
e-commerce, the future of e-commerce sector is definitely rosy. An approximated 25 lac
people have transacted online this year, the number is all set to increase with time.
Also to mention most of the Flipkart customers use internet from PC's/Laptops to
order goods. The use of mobile internet is very less at the moment, but with the advent of
smart phones the use of mobile internet for e-commerce transactions will soar with time.
India has 8 crore mobile net users at the moment, the number is expected to swell to 22.5
crore by 2014.

Lets discuss the factors that lead to the grand success of Flipkart:
1) They always strove to provide great customer service. Flipkart customers are
more happy than with some of their competitors like Tradus.in, Indiaplaza.com; i have
myself experienced this a couple of times.

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2) Their website is great, easy to use, easy to browse through the products, add
products to wish list or to a cart, get product reviews and opinions, pre-order products, make
payments using different methods, in short hassle- free and convenient.
3) A very important point is that they introduced the option of cash on delivery
and card on delivery. This way people demonstrated more confidence in buying products. An
interesting fact, today Flipkart sells 20 products/min and have a massive customer base, still
more than 60% of the Flipkart's customers use Cash on Delivery and card on delivery
methods. This is because of two reasons, one is many people do not know how to make
payments online. And secondly people do not have immense trust in e-commerce in India.
Flipkart also provides a 30 day replacement guarantee on its products and EMI options to its
customers for making payments.
4) Flipkart's reason of success is that it has a great customer retention rate, it has
around 15 lac individual customers and more than 70% customers are repeat customers i.e.
they shop various times each year. The company targets to have a customer base of 1 crore
by 2015.

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FLIPKART MARKETING STRATEGY


Flipkart has been mostly marketed by word of mouth advertising. Customer
satisfaction has been their best marketing medium. Flipkart very wisely used SEO (Search
Engine Optimization) and Google Ad-words as the marketing tools to have a far reach in
the online world.Flipkart.com official Facebook page has close to 9 lac 'likes'. Flipkart
recently launched a series of 3 ads with the tag line - "No Kidding No worries". Kids were
used to create the adverts to send out the message - if a kid can do it, you can also do it.
The message is very clear to make people more comfortable with Flipkart, to
generate a great customer relationship and loyalty on the basis of great product prices and
excellent customer service. All in all to create a great customer experience.

FUTURE ROAD MAP:


Going forward electronics will be given more focus.
Flipkart has recently added a string of electronic items like calculators, water purifiers,
microwave ovens, washing machines, dish washers, vacuum cleaners etc.
Flipkart has opened a music store which sells CD's and DVD's of movies' music releases and
music albums.
Flipkart has also acquired Bollywood movie content from Chakpak. Since digital media in
going to rise in near future, Flipkart is geared up for the same. Soon it will start offering
digital content like movies and songs online, as in the customers can pay and stream online
digital content.
Flipkart will also provide e-books very soon.
They aim at 10 times growth and eyes at $ 1Billion sales by 2015.
They will look at bigger investments in their supply chain and technology.
Investment will be made in large warehouses and increased automation of their process, so
that the product is not delayed.
They intend to enter in to various new categories and expand their current categories as
well.
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Everything except for groceries and automobiles will be available on Flipkart in future.
To go further in the value chain, Flipkart is looking at associations with a larger number of
suppliers and partners, both nationally and internationally.

THREATS IN FUTURE:
There are no major foreseeable threats in the future. The company has built a
great brand name, they just have to maintain and enhance the same. It needs to keep
introducing more products, adapting to the changing needs of the customer with time. The
entry of Amazon.com in 2012 in the Indian e-commerce space has been cited as a big
challenge to Flipkart.
However i think that Flipkart is a respected Brand name in India and should be
able to compete with Amazon. Remember Amazon being a very big company can bring in
serious competition to Flipkart, since Amazon can bear more losses in the beginning to
gain customer base. But again Indian market is growing at a rapid pace as access to internet
increases and people become more aware of e-commerce sites and start trusting the same;
hence Indian market is sufficiently big at-least for these two giants to co-exist beneficially.
Thus in the end i would like to congratulate Flipkart founders for the
determination and hard work they have put in to realize their dream. The rewards they are
reaping are a natural follow up.
The company is currently valued at around 1 billion dollars i.e. 5000 crore.
More importantly Flipkart has ushered in the e-commerce era in India. This has generated
massive interest in e-commerce sector, people are opening websites to sell anything from
shoes to apparels to jewels to baby care products etc. This has helped in creating a lot of
job opportunities and thus helps the Indian Inc. growth story as well.
Flipkart CEO Sachin Bansal's mantras to all the budding entrepreneurs vying to
build a product company:
1) Be very focused on consumers.
2) Build amazing experiences for the customers.
3) Continuously innovate the product.

PRODUCT AND BRAND MANAGEMENT STRATEGY FOR FLIPKART


MARKETING:
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This term paper for Product and Brand management is on Flipkart, the online
megastore. Online shopping has to do with the Western nations for quite some time and
Indians are very restrained to online shopping. The quality of goods, credibility of shopper,
payment options, delivery time etc are the most important things that stand in the minds of
people wanting to do any online shopping. With users of internet increasing multiple folds
every year, people want to do miracles by sitting before their laptops or home PC. Though
Amazon is one of the earlier players in the industry, it is FLIPKART which is one of the
Indian players in this industry which really brought about the great change in the mindset
of Indian population.
Flipkart is an Indian e-commerce company headquartered in Bangalore,
Karnataka. It was Sachin Bansal and Binny Bansal, alumni of IIT,Delhi who started it in
2007. In its initial years, Flipkart focused on online sales of books but it later expanded to
electronic goods and a variety of other products. Flipkart offers multiple payment methods
like credit card, debit card, net banking, e-gift voucher and Cash on Delivery.
The cash-on-delivery model adopted by Flipkart has proven to be of great
significance since the credit card and net banking penetration is very low in India.
Initially word of mouth marketing was used to popularize their company.

1. NEW PRODUCT INTRODUCTION:


In 2007, Flipkart started with selling books. The first book sold at flipkart.com
was John Woods' Leaving Microsoft to Change the World Today. In 2010, they added to
their catalogue, media (including music, movies and games) and mobile phones and
accessories.
In 2011, product launches included cameras, computers, pens & office supplies,
computer accessories, home and kitchen appliances, personal care, health care, gaming
consoles, audio players and televisions. Flipkart is currently the only authorized online
reseller of iPods in India.
In October and November 2011, Flipkart acquired the websites Mime360.com
and Chakpak.com Later, in February 2012, the company revealed its new Flyte Digital
Music Store. Flyte, a legal music download service in the vein of iTunes and Amazon.com,
will offer DRM-free MP3 downloads. Flyte offers browse by language options where users
can download international as well as regional songs. Flipkart has listed the music based on
its genre on the new music store and has given a lot of variety. Users can shop for tracks
from various albums starting at 6 on the store. A purchased song can only be downloaded
maximum 4 times on an internet enabled device. Flyte garners 600K downloads in 5
months.
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In 2012, product launches includes health & beauty products, Life style
products which includes watches, belts, bags & luggage.
As far as future is concerned, Flipkart will be looking at bigger investments in
our supply chain and technology. In terms of sales they were earlier looking at a figure of
$1bn by 2015. But this can be achieved in the next one to two years. Flipkart will also be
looking at entering new categories. Additionally, Flipkart Self-Delivery, which currently
operates in 27 cities, will be further scaled up.
In a landmark move, NH7.in, a platform to discover independent music and
leading-edge culture created by Only Much Louder (OML), has partnered with
Flipkart.com to create an exclusive section dedicated to independent music on the Flipkart
digital music store, Flyte. The store will enable independent artists across the country to
sell their music digitally to their fans.
The NH7.in store on Flipkart will be a game changer. Up until now,
independent artists had limited avenues to retail their music to the ever-growing fan base
for indie music. The NH7.in community represents the largest group of indie music lovers
in the nation. Now, along with promoting independent music, NH7.in creates an avenue for
artists to sell music directly to their fans, which is the crucial next step for independent arts
to grow. In addition to this, four million monthly users of Flipkart will have access to a
wide selection of independent music from India and around the world at their fingertips.
In July 2012 Flipkart announced the launch of its in-house brand Digiflip.
Digiflip is a brand of digital accessories with products like laptop bags, laptop sleeves and
camera bags among others.

2. ACQUISITIONS:
The following are the acquisitions by Flipkart
2010: WeRead, a social book discovery tool.
The stated goal was to give Flipkart a social recommendation platform for
buyers to make informed decisions based on recommendations from people within their
social network.

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2011: Mime360, a digital content platform company.


2011: Chakpak.com
Chapak.com is a Bollywood news site that offers updates, news, photos and
videos. Flipkart acquired the rights to Chakpaks digital catalogue which includes 40,000
filmographies, 10,000 movies and close to 50,000 ratings. Flipkart has categorically said
that it will not be involved with the original site and will not use the brand name.
2012: Letsbuy.com
Letsbuy.com is India's second largest e-retailer in electronics. Flipkart has
bought the company for an estimated US$ 25 million.Letsbuy.com had been closed down
and all the traffic of Letsbuy is diverted to Flipkart.

3. ACCLAIMS AND ACCOMPLISHMENTS:


Flipkart is among the top 30 Indian Web sites and has been credited with being
India's largest online bookseller with over 11 million titles on offer. Flipkart broke even in
March 2010 and claims to have had at least 100% growth every quarter since its founding.
As of today, Flipkart employs over 4500 people. Flipkart is the third largest online
shopping store after EBay and Amazon.
From a start-up with an investment of just four lakhs rupees, Flipkart has grown
into a $100 million-revenue online retail giant in just five years.
Flipkart's reported sales were 40 million in FY 20082009 200 million in FY
20092010 and 750 million for FY 20102011. In FY 20112012, Flipkart is set to cross
the 5 billion (US$100 million) mark as Internet usage in the country increases and people
get accustomed to making purchases online. At average, Flipkart sells nearly 20 products
per minute and is aiming at generating a revenue of 50 billion (US$1 billion) by 2014.
Flipkart.com, the country's first billion-dollar-valued Internet Company, is
surely in a state of perpetual excitement. With 2500 people, daily sales touches a crore.
Flipkart has become synonymous with online book retail and large-scale e-commerce in
India. And the key to the company's success lies in its payment-on-delivery model, which
helped overcome the average Indian consumer's misgivings and built trust.

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4. PRODUCT STRATEGY:
Flipkart is set out to create something for the Indian market a service that was
specifically built keeping the Indian consumer in mind. For them, the biggest inspiration
continues to be the constant learning process that has been a part of their journey. The other
has been the ability to realize our dream of doing something for the Indian consumer.
As far as entrepreneurship is concerned, Flipkart believes that the core focus for
every start-up, regardless of the industry, should be the same and that is customer focus.
By putting the needs of their customer first and listening to what they have to say, is the
only route to building a large, loyal customer base the blueprint to any business success
story.
Consistent customer service is the hallmark of Flipkart. Discounts cannot
replace the customer's satisfaction of being serviced promptly and efficiently. Similarly, the
trust-building exercise is accorded a lot of importance. Flipkart connects with customers in
real-time, through Facebook and Twitter. Honesty is the best policy for this e-commerce
trailblazer.
Flipkart is rapidly expanding its network of warehouses, distribution centers,
procurement operations and 24/7 customer support teams. The company has its own
delivery network in 37 cities and is set to expand this in the current financial year. With a
team of around 4,800 members, the company operates from offices and warehouses in
seven Indian cities.
5. OPERATIONAL STRATEGY:
Flipkart began operations on the consignment model goods were procured
from suppliers on demand, based on the orders received through the website. However,
eventually, the books-to-electronics e-shop adopted the warehouse model. The company
has its own warehouses, and maintains its own inventory. Sales projection determines the
inventory, and the available inventory accounts for the sales made; it's a self-feeding cycle
of sorts. Nearly 60 to 70 per cent of deliveries take place through their own network as this
model provides for better control over the entire logistics management piece.
On the operational front, issues faced by the company pertain to delay in
deliveries, or faulty products. As a customer-centric, none of these issues can remain
unresolved for long. They faced significant challenges in reverse logistics. It's a big task to
track unsuccessful orders, which are quite costly to manage. Hence, Flipkart stresses on
customer service it aligns with the firm's philosophy of making better our service
promise'. Their bigger objective is to redefine the way India shops.
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Flipkart will continue to expand our categories in order to meet the growing
consumer interest in the e-commerce market. They have recently added computer
peripherals, kitchen appliances, televisions and home theatre systems and selected
stationery items to their product range. They will continue to add more products / selection
to their existing categories as well.

6. BRANDING:
Flipkart went for a major brand makeover, making it look more up market.
There have been large newspaper ads, TVCs and a lot of web ads. But unlike other
ecommerce companies the inorganic marketing kicked in only when the product was
strong. Flipkart already had a proven model execution with books and extending to other
verticals did not need infrastructural changes. Flipkarts real achievement has been in
solving the pain points in Indian ecommerce that most well funded players are still
complaining about.

7. FLIPKARTS STRATEGY IN SOLVING PROBLEMS IN E-COMMERCE:


1. Discoverability:
It is the case with any venture on the web, How does the customer find us?
Answer: Organically! Flipkart has been the baap of SEO. This has been the most
important contributor to their success. Only when you see people coming to you, you get
encouraged to deliver more and keep adding. There is no fun (motivation) in adding
features to a product that no one is using.
SEO did not come the straightway. There were particularly 2 things that are
worth mentioning.
a. Yahoo News:
Until last year Flipkart had a feed of Yahoo News on its product
pages. From what SEO means, this is to increase the keyword density and introduce
original content on the page, as the product description across all books sites is same.
b. We Do Not Sell Used Books:
We DO NOT sell old books or used books. All the books listed at
Flipkart.com are new books.The books listed at Flipkart.com are NOT available for free
download in ebook or PDF format.
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The magic of this text is that if searched for <book name> free eBookor
<book name> pdf download you would always get Flipkart among the top results. These
are very popular search queries and Flipkart had nothing to do with it but still they cashed
in. This was also the time when Flipkart had Adsense embedded. People would come to the
site, see nothing like a PDF download button, and then see an ad for PDF download and
click. This meant more revenue for Flipkart. Given that the margin on books are very small
after the discount, Flipkart was probably earning more by saying what they did not do than
by doing what they actually were suppose to do.

2. Payments:
No credit card/net banking, fear to transact online, repeat transaction failures,
no access to web these are the common problems with online payments. What Flipkart is
doing to overcome these?
Flipkart had at least 4 different Payment Gateways integrated. They introduced
Cash-on-Delivery. Then they are also doing order on phone. Payment via DD/Cheque is
also accepted.
Two basic things that they are currently doing that take little technical effort but
quite some product management will:

a). Auto redirection to banking site: Unlike most other ecommerce sites, Flipkart
never lands you on CCavenue page, you are auto redirected to the banks page where the
info is required to be filled. Flipkart by-passes 1 unnecessary page by passing the required
parameters directly to CCavenue and not through a user interface.

b). Banks Status: Flipkart maintains its own real time status if the banks net banking
is working or not. So there are no surprises after you have chosen the bank and then go to
the net banking page.
3. Inventory:
In the world of eCommerce, the players keep a standard list of products and
then go out procuring it only when there is an order placed. There is no inventory on their
end and there is no live status of inventory from their supplier. Remember The Alchemist,
Never Promise something that you dont have.
After placing an order, they would keep looking for the product at multiple
places. After a week you might get a call saying that either the product is not available and
we will do a favor by refunding your money or if the product is there, it is not the
color/size that you asked for.
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Flipkart was no different in 2009, many customers used to get similar calls after
days of ordering. But for the last 1 year at least Flipkart maintains its own inventory (or at
least it seems so). They are selling what they have. From pure hearsay, Flipkart is taking up
a big warehouse in Bangalore and is in talks for one in NCR as well. One of the few
companies that is using the funding to build a business and not spend it like a FMCG
company on ads
4. Delivery:
Flipkart is exploiting the delivery problem as a cashable need gap and building
its own delivery backend. Flipkart is seen delivering through their own delivery boys in
Bangalore and at times within 12hrs from order.
Flipkart has started putting fliers in newspapers in Bangalore with a product
listing, call-to-order phone number and a promise of delivering tomorrow. This means
more discoverability, no payment problem and no delivery delay.
Flipkart is looking to build its own courier company. The recent $20Mn funding
from Tiger Global was only part of a larger sum they are known to be raising. Flipkart is
looking to raise $100Mn at a valuation of $200Mn.

8. MARKETING :
It is very difficult to sell a product which has been offered intentionally high to
a middle customer in India. But then the customer is getting that offer at the comfort of
their home. Any customer will like this and will pay the amount tagged by retailer. But
how can this idea are promoted. Flipkart used Word of Mouth as their best marketing tool
to sell their product. A satisfied customer tells others also about a good experience, and this
how the business of Flipkart depends. Flipkart has been using different Social Networking
Engines to promote their product. Promotions on Facebook, twitter and other social sites
helps in gaining some attention, but to some extent, the rest has been done by Services
offered by Customer.
Customer satisfaction has been their best marketing medium. Flipkart very
wisely used SEO (Search Engine Optimization) and Google Ad-words as the marketing
tools to have a far reach in the online world. Flipkart.com official Face book page has close
to 9 lac 'likes'. Flipkart recently launched a series of 3 ads with the tag line - "No Kidding
No worries". Kids were used to create the adverts to send out the message - if a kid can do
it, you can also do it.

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The message is very clear to make people more comfortable with Flipkart, to
generate a great customer relationship and loyalty on the basis of great product prices and
excellent customer service. All in all to create a great customer experience.

9. PRICING STRATEGIES :
Without going into the theoretical and the management theories, pricing can be
set on the following points:

1. Operating Margins - Essentially determining what the company earns to sustain


business and turn a profit

2. Strategic Pricing - Basically overall pricing strategy where some products are
given at a higher discount in order to capture market share or consumer mindshare.
So individual product pricing can be higher or lower while the overall picture is
kept in mind so that the company as a whole can sustain itself on an overall profits or deep
enough pockets to work on losses for sometimes.
Price is optimized best when the overall cost to the company per product is
optimized. So that means here the contributing factors have to be looked at and the costing
there has to be optimized.
So looking at the major cost factors that affect the E-Commerce that are taken
care of Flipkart:
1. Supply Chain ( Procurement And Shipping):
Flipkarts core competency lies in their Supply chain and logistics which has
been perfectly monitored and managed by professionals. This involves a deep
understanding of where the suppliers are and where the end consumers are so that when a
customer orders a product, it can reach him by the shortest route in the shortest time and
minimum manpower time being spent.
This also means that customer demand is anticipated and pre-emptive steps are
taken so that products are ready to be shipped from the point closest to the consumer
before he even places the order.
This helps in reducing the overall cost of moving the product to consumers
place. The overall cost of Flipkart has been reduced to great extent, all thanks to Blue
Dart, the logistics partner of Flipkart. It is so because the transportation cost has been
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reduced and therefore Flipkart is able to earn a reasonable margin on the sale of product,
belongs to the actual producer
2. Manpower And Time Spent On Each Order:
We must understand that all operations have to be made sustainable and more
importantly scalable for ultimate long term growth. So all process from what route a person
takes to pick up material to how much time it takes to pack a product have to be looked at
and it is when a company works toward optimizing all these processes that a company
really starts to take the lead.

10. COMPETITION :
Competition is increasing day by day and by the end of 2015, there will be huge
number of players in E-commerce in India. With the rise in Internet users, the numbers of
e-commerce companies are also increasing. So Flipkart will definitely face tough fights in
future and they should be ready for it. Snapdeal is currently the biggest competitor of
Flipkart. Other close competitor includes Groupon, best deals etc.

11.TACKLING COMPETITION :
Great Website:
Flipkarts website is great, easy to use, easy to browse through the products, add
products to wishlist or to a cart, get product reviews and opinions, pre-order products,
make payments using different methods, in short hassle- free and convenient.

Great Delivery System:


When user places an order, the postal address has been tracked. And the order
goes to nearest warehouse. And it is being packed, picked up and delivered by local courier
company. The advantage of cash on delivery is no fraudulent activities or anything. When
the item is delivered makes sure the item is there and then pays. And also user can track the
routine of item through email. And the company informs about the status of item.

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Great Books And Hot Deals :


Flipkart offers excellent collection of books, DVDs, movies, electronics items,
home appliances, and life style and health care products. Flipkart promo coupons and
discount coupons are also available. One another feature of Flipkart is best deals and
offers. When you place an order greater than 300 INR, youll get free shipping.
Excellent Communication System:
Flipkart is renowned by their relationship with the customer. If you are facing
any difficulties getting the product you can contact them via telephone (like everyone
24/7), email or through website.
India is a hard place for delivering any item but Flipkart is managing to deliver
the item in 2-3 business days. If the order you placed is not available dont worry. The
enquiry goes to nearest supplier and the item becomes available It will delivered within 24
hour. Flipkart is aiming to bring down the delivery time of regular orders to 24 hour. An
excellent marketing strategy by Flipkart marketing team to increase the sales
Great Customer Retention Rate :
Flipkart's reason of success is that it has a great customer retention rate, it has
around 15 lac individual customers and more than 70% customers are repeat customers i.e.
The company targets to have a customer base of 1 crore by 2015.
Credible And Easy Payment System:
Flipkart offers many modes of payment such as
Credit/debit card
Net banking
Cash on delivery.
0% EMI
Online Wallet

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Also Flipkart offers 0% EMI on transactions made on credit card payment


where the whole amount can be paid in 3 monthly installments without any extra charge.
For installment greater than 3 months, a minimal charge is levied.
Flipkart Adds Online Wallet to Ease Payment Woes
Flipkart has added a new Walletfeature to enable customers store money in
their Flipkart account and redeem it on future purchases. Flipkart Wallet works on a
prepaid credit system: you can top up your wallet with any desirable amount up to Rs
10,000 by using any one of its regular payment modes like credit card, debit card, and netbanking. This amount will then be reflected as prepaid credit on your account and can be
used as a payment mode for all forthcoming purchases on the portal. Expectedly, this
amount will be deducted from the balance in your accounts wallet.
Flipkart allows you to make a partial payment using your Wallet and pay the
remaining amount using other payment modes like credit card, debit card, and net-banking.
Flipkart does point out that cash-on-delivery payment mode cannot be combined with a
Wallet payment.
This is Flipkarts way of bypassing payment gateway problems and also
facilitates frequent shoppers.

12. FUTURE STRATEGY FOR FLIPKART :


Overnight successes usually last just that one night. Strategy has got to lay out a
more forward-looking roadmap for a company that spans multiple years. To make things
simple, lay the future out into three phases Build, Pull Away and Transform. These do not
need to and indeed should not be distinct phases but rather overlap each other to benefit
from positive momentum that each phase builds and hands over to the next.
Build: A solid foundation is half the good work
In its first phase of transformation Flipkart must build deeper engagement with
its customers. It needs to both build a deeper relationship with its buyers and provide those
touch points that are more omnipresent than the web-based Internet.
Loyalty: It is strange that for a service that is not vividly distinguished from
me-too, Flipkart chose not be build loyalty programs. Loyalty need not have just the old
school implementation of co-branded shopping appliances like credit cards. Loyalty
programs need to be deeper, where someone who has greater wallet spends at Flipkart feels
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rewarded both monetarily and more importantly otherwise. Flipkart Coupons is another
loyalty device conspicuous by its absence. As gifting increasingly strives to put last-mile
choices back in the hand of the recipient, a loyalty program based on redeemable coupons
will deepen association with the customer. Corporations spend a lot of money in fine
tuning their Rewards & Recognition programs to make them suitable for the young
demography a space that Flipkart can immediately capture (and since corporations buy
coupons in bulk, a part of working capital management can also be taken off in the
process).

Touch Points: Ecommerce is shifting from the browser to applications that sit
on devices. Flipkart can regain its first mover advantage by introducing iOS and Android
apps that make shopping much easier than on native browsers.
Ring fencing customers and pampering those who return for more is crucial in
the build-out phase. For years, Flipkart has focused on internal effectiveness and not so
much on the customer and it is about time to change that. There is also an important
mindset change that needs to happen at this phase increasing value for not only buyers
but also sellers who would benefit the most in having access to the Flipkart platform. The
outcome of such thinking will play an important part in the late-second and third stage of
this transformation
Pull Away: Inorganic growth and building the ecosystem
Exploit Adjacencies: Having built a solid foundation where the customer has
been placed at the focus of future planning (in addition to internal effectiveness, which
Flipkart has always excelled in), opportunities in adjacencies need to exploited. Category
expansion, which Flipkart has been at, is one way to provide buyers with all their needs on
a single platform and leverage scale.
There are adjacent categories however that have already matured into fullfledged businesses with similar not exact contours. Take travel for example. The basic
fabric of the business is similar acquire inventories from suppliers, build a technology
platform for delivery, squeeze out a bit of margin and deliver the product by careful
customer segmentation minus the added headache of physical deliveries. Standing where
we are, categories such as these are too difficult to build grounds up for Flipkart. Hence an
acquisition is the best route to increase momentum on the ecommerce flywheel Flipkart has
already built and set in motion.
Build The Ecosystem: When a business model has successful equivalents in
developed markets, the role of a local strategist becomes easy import ideas. How
successful will a Flipkart handheld device or Flipkart Web Services become? What is
interesting however is building a supply ecosystem where original creators are encouraged
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to participate on the platform without losing value to intermediaries. Authors are a very
obvious target audience in this category, which itself has a very wide range encompassing
text books, animated books, restored (and retold) classics, fiction, non-fiction, graphic
novels the list can go on. Besides the content, form has diversified significantly, thanks to
bloggers and journalists. Developing relationships with producers directly (building the
relationship is not entirely easy) and co-creating products increases the value of the
Flipkart platform for those who were perhaps dis-intermediated or losing too much to make
authoring a successful profession .
Inorganic expansion and building ecosystems should herald a different thinking
process for Flipkart a line of thinking that transforms the business from being a service
providing ecommerce to becoming an electronic marketplace and platform. Platform
companies (Eric Schmidt named Facebook, Amazon, Apple and Google as the Gang of
Four Platform Companies) are ones that come with a core and then combine complements
from a variety of other providers to add disproportionate value to the service. Platform
companies are difficult to build but once done (and there are important technology and
business considerations) are in the long-term more successful than pure-play product or
service players.
This phase of pulling away is the most important phase in Flipkarts strategy, in
both design and execution.
Transformation: Onwards to Flipkart 2.0
The vision for a transformed Flipkart is where Flipkart is a platform inviting
multiple entities to participate not only as part of the supply chain, catalogues and
consumption but most importantly in innovation. Think of it this way: where in a fastforwarded world Flipkart is a platform for providing online education content to a vast
majority of institutions in India. Creators of content will always strive to innovate and
Flipkart being a platform will reap the benefits of that innovation without having to
explicitly participate in it. On the same platform innovators will bring newer ways to
present the content and perhaps another participant will make learning more social.
Leveraging scale becomes easier for a platform company. Continuing with the
earlier example, investments in building incremental ecosystems can present
disproportionate rewards to business outcomes for Flipkart. The same (or very closely
related) content for education could be as applicable in Southern Africa as is it is India,
opening up immediately vast business potential. The true unlocking of scale can easily
happen in a world where Flipkart is a platform rather than an ecommerce service.
A large-scale program that takes a product or service company and transforms it
into a platform play is not simple. For some it could be a lifes dream. But it certainly is a
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dream worth living. For a company like Flipkart that has already transformed the
ecommerce market in India, this could be the second calling for a chance of inclusion in
historys wall of fame.

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PROFILE OF SNAPDEAL
Snapdeal.com is an online marketplace, New Delhi, India. The company was
started by Kunal Bahl, a Wharton graduate as part of the dual degree M&T Engineering
and Business program at Penn, and Rohit Bansal, an alumnus of IIT Delhi in February
2010.

HISTORY OF SNAPDEAL :
Snapdeal.com was started in February 2010 as a daily deals platform inspired
by Groupon.com but expanded in September 2011 to become an online
marketplace. Snapdeal has grown to become the largest online marketplace in
India offering an assortment of 4 million+ products across diverse categories from over
50,000 sellers, shipping to 4,000 towns and cities in India.

FUNDING :
Snapdeal has received 6 rounds of funding:

Round 1: In January 2011, Snapdeal received a funding of $12 million from Nexus
Venture Partners and Indo-US Venture Partners.

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Round 2: In July 2011, the company raised a further $45 million from Bessemer
Venture Partners, along with existing investors Nexus Venture Partners and Indo-US
Venture Partners.

Round 3: Snapdeal then raised a 3rd round of funding worth $50 million from eBay
and received participation from existing investors i.e. Bessemer Venture Partners, Nexus
Venture and IndoUS Venture Partners.

Round 4: Snapdeal received its 4th round of funding of $133 million on Feb-2014.
The 4th round of funding was led by eBay with all the current institutional investors,
including Kalaari Capital, Nexus Venture Partners, Bessemer Venture Partners, Intel
Capital and Saama Capital all participating.

Round 5: Snapdeal received its 5th round of funding of $105 million in May-2014.
The 5th round included investments by Blackrock, Temasek Holdings, PremjiInvest and
others. The round valued SnapDeal at $1,000,000,000.

Round 6: Snapdeal received its 6th round of funding in Oct-2014 from Softbank with
investments worth $627 million in fresh capital. This makes SoftBank the largest investor
in Snapdeal.

CORE VALUES OF SNAPDEAL :


We have always taken pride in our culture. There are some core values that have
been inherent and are an integral part of our success story. These values are a pure
reflection of what is important to us as a Team and Business.
Here are our 5 Core Values that we live by :
Innovation - Creativity is at the core of our business values. The team is given
the freedom to take informed, responsible risks.
Change - We are ever evolving and believe in driving change, embracing every
opportunity with open arms.
Openness - We encourage every team member to share ideas and feedback
openly thereby building strong relationships built on Trust and Faith.
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Ownership - Every member owns the task they take up. We foster
collaboration while building individual accountability.
Honesty -We believe in doing the right thing under all circumstances.

ACQUISITIONS :

In June 2010, Snapdeal acquired Bangalore-based group buying site, Grabbon.com

In April 2012, Snapdeal acquired esportsbuy.com, an online sports goods retailer


based out of Delhi.

In May 2013, Snapdeal acquired Shopo.in, an online marketplace for Indian


handicraft products.

In April 2014, Snapdeal acquired fashion products discovery site, Doozton.com.

In December 2014, Snapdeal acquired gifting recommendation site, Wishpicker.com.

In January 2015, Snapdeal acquired a stake in product comparison website


Smartprix.com.

In February 2015 , Snapdal acquired luxury fashion products discovery site ,


Exclusively .in

BUSINESS RESULTS :
In the year 2012-13 Snapdeal had said that it expected revenues of about Rs
600 crore ( US $ 94 million ) . Betting big on the growth of mobile commerce, Kunal
Bahl, the CEO, said at the time that 15-20 per cent of the sales on Snapdeal came through
m-commerce. Snapdeal.com expected the total sale of products traded on its platform to
cross 2000 crore (US$310 million) in the fiscal year 2013-14 helped by its robust growth
in the past two years and the growing popularity of e-commerce in India. In June 2014,
Snapdeal announced that it had achieved the milestone of 1000 sellers on its platform
getting sales of over Rs 1 crore.
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AWARDS & RECOGNITION :

E - Retailer of the Year & Best Advertising campaign of the year - Indian eRetail
awards 2012 organized by Franchise India in Feb,2012.

Winner of Red Herring Asia Awards 2011.

E-commerce site of the year at WAT awards that took place in Jan 2012, Mumbai.

Voted amongst the Buziest brands of India in afaqs's annual buzz-making poll.

TRIVIA :
In June 2011, Shiv Nagar, a village located in Muzaffarnagar district in Uttar
Pradesh, India, became SnapDeal.com Nagar ( Nagar Means Town), after Snapdeal had
installed 15 hand pumps for drinking water. The villagers voted to name their hamlet after
Snapdeal to express their gratitude.

CRITICISM :
Snapdeal has been criticized for failing to deliver big discounts and speedy
deliveries on its Savings Day Sale held on 11th November 2014.

VI . OVER VIEW OF SNAPDEAL


Snapdeal is an e-commerce company based in India. It is a daily deals' website
that features discount offers across lifestyle segments such as dining, health & beauty,
entertainment and travel. It also offers discounts on products like electronics, perfumes,
watches, bags, sunglasses and mobile phones.
Headquartered in Delhi, Snap deal.com was launched in February 2010. The
company was founded by Kunal Bahl, a Wharton graduate and Rohit Bansal, alumnus of IIT
Delhi who are friends since school. They had agreed that after finishing their studies and
gaining required work experience, they would start a project of their own.
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Snapdeal was founded in February, 2010 and in a short span of four years, has
become Indias largest online marketplace for businesses to reach sell their products to
consumers nationwide, a model that the company pioneered in the Indian market. We feature
the largest selection of 5 million+ products across various categories like Apparel, Mobiles
& accessories, Watches & bags, Electronics & cameras, Computers & Peripherals, Perfumes,
Beauty & Health, Footwear, Home dcor, Kitchenware amongst others.We are a team of
very young, dynamic & Innovative team of 1500+ team members, and is backed by leading
global strategic and financial investorss. The company witnessed phenomenal growth in
2013-14, growing 600% from 2012-13 to 2013-14. Snapdeal has received many global
accolades including being featured in Digital 100: The World's Most Valuable Global Private
Tech Companies (Business Insider)
Snapdeal.com serves as an advertising platform for merchants and a discount
platform for customers. For the merchants who partner with Snapdeal, it is a cost-effective
channel for acquiring new customers. It also works as a risk-free alternate marketing
channel. From the merchants standpoint, they are passing on the customer acquisition cost
in the form of a discount offer.
The company uses the term 'deals' to describe the discounts it offers. One deal
varies from another in terms of its pricing structure. While the entire offer amount is
collected upfront in some deals, other deals let customers pay a certain amount on the
website and rest to the merchant.
Unlike companies like Groupon that have group-buying models, Snapdeal does
not have a threshold number of deals that must be bought before a deal can 'go live'. Even if
one deal sells one voucher, it can be redeemed.
The website features deals across its city-based pages every day.
Mission: Snapdeals mission is to create life changing experiences for small
businesses in India that account for 93% of Indias retail industry.
Snapdeal aims at making life more fun for consumers. Being India's best daily
deals website, it brings to you up to 90% discounts on dining, health and beauty services,
branded products, travel and more. Its vision is to make Snapdeal consumers engine of
discovery for what to do, eat and buy in their city. With daily deals in close to 100 cities, it
ensures that it reach consumers in every nook and corner of the country.

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It has a simple business philosophy: it does not offer just deals; it offers great
experiences. Here's how it ensures that:
Consumer does not need to spend a fortune to enjoy what they love. That's why they get
unbelievable deals on restaurants, spas, salons, gyms, branded products, mobiles, travel and
more.
Consumer can spread cheer and joy among friends. They can share the secret of smart
shopping with family and friends and continue to spread the cheer.
There's no catch. Yes, the fine print for a deal does not get any finer. It ensures that
consumers experience is not maligned by hidden clauses. It says it the way it would like it!
Consumer gets to enjoy the best services and buy the best brands. It takes pride in
bringing to consumer the best names in the business. It goes to great lengths to ensure that
consumer keeps coming back.

VII . MARKETING STRATEGY OF SNAPDEAL


1. SNAPDEALS UMBRELLA E -COMMERCE STRATEGY; ADDS GADGETS,
ELECTRONICS :
Indias leading deals site SnapDeal.com is following an umbrella e-commerce
strategy, and has added lifestyle products and consumer electronics to its daily deals
section. We will be adding lifestyle categories such as watches, fashion accessories like
belts and bags and electronics to Snapdeal.com. We will offer deals on products that will
still appeal to the masses,
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Predictably, deals on mobiles are popular on the site: take for example a 54%
discount on LG GW300, a budget phone which has caught the eye of 92,964 people.
The model will continue to remain daily deals, but now with products joining
services categories like restaurants, spas, gyms, movies, etc. It was inevitable that the
model of daily deals on services and products merged since the customer is the same, says
Bahl.
Since the model is about having a large userbase and selling them all what they
want, this strategy may be the right thing to do in order to achieve scale.
However, some questions that the company may need to mull: Are the gadgets
being offered the latest models? Are they in demand? How much of a lead does one deals
site get before competitive deal sites latch onto the same product?
The space is hot with many deal sites in India trying to grab the eyeballs of
deal-hungry Indians. The others in the space include Groupons SoSasta.com, Delhi-based
Dealsandyou.com, Mydala.com, Buzzintown.com, and Koovs.com. Then there are others
like Dailydeal.in, Dealivore.com, Khojguru.com, Thekha.com, Scoopstr.com,
24Hoursloot.com, Masthideals.com, Snatchdeals.com, Lootmore.com, 30Sunday.com and
Bindasbargain.com. trying to find a place in the sunshine.
SnapDeal expects consumer electronics sales to contribute to 30% of its
business by year end. So its not expected to overtake revenues from deals on services any
time soon. It claims to be complementing existing ecommerce players by selling their
distress inventory, but it could eat into ecommerce sales of eBay India, India Plaza,
Infibeam.com and Flipkart.com.
Groupon India has also adopted an umbrella ecommerce strategy. For more
about their plans, read TechCircle.in. New ecommerce sites such as LetsBuy and
BuyThePrice will also now face off with Snapdeal, an aggressive competitor

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2. SNAPDEAL LAUNCHES DIWALI CAMPAIGN WITH 50 COMMERCIALS


FEATURING 28 CELEBRITIES:

Indias largest online marketplace, Snapdeal.com, has launched its biggest


marketing campaign for the upcoming Diwali season. The campaign, which has recently
gone live across electronic and print media focuses on Diwali shopping on Snapdeal.com.
For this campaign, the brand has signed up 28 celebrities including leading TV actors from
popular TV shows to create 50 different commercials. Each commercial will showcase
these celebrities endorsing the Snapdeal Diwali Bumper Sale while playing their characters
in a quirky manner.
With this unique marketing strategy, Snapdeal.com aims to reach its varied
customer base across metros and Tier II & III cities, by bringing on board celebrities who
the consumers from all backgrounds relate to. This includes much loved and popular
celebrities like Ali Asgar (Dadi from Comedy Nights with Kapil), Alok Nath (the popular
Babuji), Harsha Bhogle (Cricket Commentator), Mandira Bedi & Karan Tacker (TV
personalities & fashion icons), Rana Daggubati (South Indian Actor & Film Producer),
Kirti Kharbanda (Actor & Model), Radhika Apte (Film & Stage Actor), Parul Yadav (TV
Actor who appeared in the show Bhagyavidhaata), Sargun Mehta (plays the role of Ganga
in popular TV series Balika Vadhu) Krushna Abhishek (Actor & Comedian, Comedy
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Circus), Sumona (Actor, plays the role of Natasha Kapoor in Bade Ache Lagte Hain &
Mrs. Sharma in Comedy Nights with Kapil), Kiku Sarda (Actor & Comedian).
Speaking about this innovative campaign, Sandeep Komaravelly, Senior Vice
President at Snapdeal.com said, This is one of the most innovative and unique marketing
campaigns that has been attempted so far, by any brand. We have strategically chosen the
most popular characters from the best loved TV shows across India to connect with our
wide consumer base. The idea was to talk about Diwali Bumper sale, using characters that
everyone relates to. Its a very novel approach for a marketing campaign.

3. CROMA AND SNAPDEAL ANNOUNCE STRATEGIC TIE-UP :


The brands will jointly work towards market development, collaborate on
customer and vendor outreach programmes and category development.

Croma and Snapdeal have launched Lenovo tablets and announced special
offers on a Karbonn handset. Photo: Priyanka Parashar/Mint Mumbai: Tata Group
company Infiniti Retail Ltd, which operates consumer durables and information technology
(IT) retail chain Croma, and Snapdeal.com announced a strategic partnership on Tuesday
through which goods available at Croma stores will now also be made available for
purchase through Snapdeal.com.
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As part of this partnership, Croma and Snapdeal.com will jointly work towards
market development initiatives, and collaborate on customer and vendor outreach
programmes and category development. Both brands will also look at exclusive launches.
Croma and Snapdeal have already launched Lenovo tablets exclusively on the platform and
announced special offers on the Karbonn Titanium S10 mobile phone. This is a big
moment for us. Croma and Snapdeal.com will now leverage their offline and online
presence respectively and work jointly to offer a more holistic shopping experience to
consumers across the country.
Todays dynamic retail industry demands infrastructure that is equally robust
on the online and brick-and-mortar fronts. Omni-channel retail is undoubtedly the way
forward in the Indian retail industry, and therefore the association is designed to enable
Croma and Snapdeal to leverage each others strengths, to provide a winning proposition
for customers and business alike.
As e-commerce gains momentum in the country, organized retailers are looking
at so-called omni-channel retail. This essentially involves the use of multiple channels
including mobile, web or stores to reach customers. Earlier in September, the Future
Group, the parent company of Future Retail Ltd, Future Lifestyle Fashions Ltd and Future
Consumer Enterprise Ltd announced an investment of Rs.100 crore to roll out its own
omni-channel retail strategy over the next 18 months. Even Shoppers Stop Ltd, which runs
the department store by the same name and books and toys chain Crosswords, is in the
process of drafting its omni-channel strategy which will be rolled out over the next 24
months. Indias overall retail market is estimated to be worth $554 billion, with organized
retail accounting for 8% of this and online retail just 0.4%.
However, online retail is growing fast. Online retail is expected to see 50-60%
CAGR (compounded annual growth rate) in the next three years.

4. MARKETING APPROACH OF SNAPDEAL :


Recall the last time you heard from a marketing guy-do not try your hands at
marketing, it is the devil! Well, this may seem a little untrue when you hear our story.

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For work a holics at Snapdeal, marketing is all about nurturing the brand and
affinity with their customers. It is about ensuring that Snapdeal is an e-commerce
company that aims to have the most delighted customers in the world!
This blog post is about how madness and frenzy falls upon the marketing guys
at Snapdeal. It will take a book to write all about it but lets take a look at some highlights
and see how super cool they were!

HITTING THE RIGHT SPOT! :


Buy it or not- we believe in doing things the BIG way and exposing it to the
wide audience. Buzz and hit the right spot describes our first marketing strategy.

GUL PANAG ON DISCOUNT! :


Snapdeal created a lot of excitement the last Valentines Day with an innovative
Date with Me-Gul Panag campaign. The offer was quite simple, stating anyone can buy a
date with Gul Panag at a special price. But, the kind of buzz it created in the market was
incomparable.
You can now take actor Gul Panag for a Valentines Day date on well, a super
discount of 90%! A discount deals website is offering a romantic date in Mumbai with
beauty queen-turned actor, Gul Panag, for Rs 50,000. It was initially priced at around Rs
5,00,000.
Under SnapDeal.coms Date with Me scheme, the person buys the date on
Valentines Day, and enjoys it on a mutually convenient day. It will be an adventure
activity and a meal for a few hours.
It is attractively priced and there is no bid but only buying, he adds. Panag, on
her part, has no qualms being on sale for a day. I think its a great idea ... I like to be part
of experiments, and this was surely interesting, she says. And what would be her saving
grace if she lands with some starry-eyed fan? Ill take it as it comes, says the Turning
30 actor.

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The proceeds of the campaign will be donated to Guls charity The Col
Shamsher Singh Foundation. Leading Hollywood celebrities like Scarlett Johansson,
Charlize Theron and Robert Pattinson have already gone under the hammer for a date for
charity over the last few years.

OWNING THE SPACE :


Snapdeals next big thing is to hit the outdoors. This year the team came up
with a massive Snapdeal banner which stands imprinted on a building in Gurgaons-DLF
Cyber City. Many thought and still think, that it is Snapdeals office! Thats what you call
owning the space and the mind. Quite audacious an attempt since it has never even
been tried before by an online portal!

ITS CLOSE TO OUR HEART! :


And how can we forget the best thing the team did this year. Very close to the
heart and special. Wondering what? Read below and you will get to know!
Snapdeal.com Nagar-does this ring a bell?. Since we were planning to do
something in our own small way to the society, we thought it was a good opportunity to
support a village, where one of our colleagues comes from, by enabling easy access to
portable drinking water and the villagers expressed their gratitude by naming the village
after Snapdeal! So, here it is Snapdeal.com Nagar.
Uber cool and bold are a few understatements for Snapdeals excellent
marketing strategies. We know the tricks and techniques of the trade. But going to the
ground level and executing it; is really, really tough and so it is more fun!.
In short, Snapdeals dynamic marketing approach includes doing things the big
way and creating the buzz through innovative ways.

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VIII . COMPARATIVE ANALYSIS


OF
FLIPKART & SNAPDEAL
Flipkart and Snapdeal are building large advertisement sales teams and
improving their technology to serve ads based on data collated on the shopping habits of
millions of Indians, potentially putting the countrys top Internet retailers in direct
competition with Google Inc. and Facebook Inc. in India. After splurging a big chunk of
their massive cash hoards on advertising campaigns on Google and a Facebook as well as
traditional media companies, Flipkart and Snapdeal, run by Jasper Infotech Pvt. Ltd,
started generating ad revenues last year and are building large ad monetization teams to
boost this business, according to four people familiar with the matter.
Sachin Bansal, co-founder of Flipkart, is spearheading the add business after
the company reorganized its structure earlier this month, they said on condition of
anonymity as these plans are private. Flipkart is improving its ad platform by buying
mobile advertising technology firm AdIQuity Technologies and the company plans to
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compete with the likes of Google and Facebook in India for a share of online ad spending,
the people quoted above said. AdIQuitys technology will help Flipkart tap its fast-growing
user base and analyse consumer data and shopping patterns for generating ad revenue.
Mint reported on 29 December that Flipkart was in advanced discussions to buy AdIQuity.
Flipkart declined to comment. Snapdeal and AdIQuity didnt respond to emails seeking
comment.
Flipkart and Snapdeal generate ad revenue mostly in three ways: by selling socalled banner ads; by getting brand partners such as Xiaomi to spend on marketing on their
sites; and by charging extra fees for promoting third-party sellers. For instance, a thirdparty seller can pay extra to have its products shown first when a shopper uses certain
keywords to search for goods on the two sites; if a user searches for casual shoes, a seller
can ensure its products are shown prominently by paying extra. As Flipkart and Snapdeal
add thousands of sellers this year, these marketplaces are hoping that competition among
sellers will prompt some of them to pay lucrative rates for prominent positioning. Flipkart
has set itself a target of drawing 100,000 sellers this year to its site from 12,000-13,000
currently. And with a large user base that is growing fast, Flipkart and Snapdeal are also
betting that retail brands, consumer goods makers and electronics brands will increasingly
use their platforms to place advertisements. In India, a majority of online ad spending goes
to Google and Facebook currently as there are few other sites with large traffic numbers.
If successful, these moves can provide a much-needed boost to margins at
Flipkart and Snapdeal and create an additional, large revenue stream for them. Both
Flipkart and Snapdeal are trying to model themselves on Alibaba, which listed in the US
last year in a record initial public offering. Alibaba generates more than 55% of its sales
from ads, according to data by iResearch Consulting Group, and the company even bought
a controlling stake in online ad firm AdChina in January to increase ad revenues. Alibabas
consumer marketplace site Taobao is Chinas second-largest online ad generator after the
local search engine Baidu, according to iResearch. Amazon.com Inc. is also working on an
ad platform that will battle with Google for online ad spending. Amazon generated roughly
$1 billion in online ad sales in 2014, according to estimates by eMarketer. That number is
insignificant compared with the $55 billion-plus that Google likely generated from ad
sales, according to published numbers. Investors have pumped in about $3 billion in
Flipkart and Snapdeal over the past year, betting that these companies can maintain their
flying sales growth. While sales growth isnt a concern, Flipkart and Snapdeal are nowhere
close to generating profits, and many analysts say it will take several years for these
companies to make money because of their cost structures, deep discounting and intense
competition from Amazon India.
Add revenues are very lucrative as this goes straight to the bottom line, and
Alibaba has shown the way for making ads a core part of the marketplace business, said
Abhishek Goyal, founder of Tracxn, which sells data on start-ups. In India, the online ad
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business is nascent so its up for grabs. Flipkart and Snapdeal account for a large part of the
online traffic and they have rich consumer shopping data so there is clear potential to build
sizeable ad businesses. Flipkart co-founders Sachin Bansal and Binny Bansal own small
stakes in Tracxn. To be sure, some analysts say it would be tough for Flipkart and Snapdeal
to replicate Alibabas success in ads. The marketplace business in India is much, much
smaller and less evolved than Chinas. I think itll be years before e-commerce firms
generate a large percentage of their revenues from ads because there arent that many
sellers who can afford to pay for ad slots and ad words, said an analyst who works with
Flipkart and Snapdeal. He spoke on the condition of anonymity.

SNAPDEAL: TARGET NON-METROS :


We are not an ecommerce firm; we enable ecommerce through our platform.
We provide a platform for sellers to offer their products. We do not buy inventory, says
Kunal Bahl, CEO and co-founder of Snapdeal.
The model, he points out, has two advantages: Buyers get access to a wide
range of products and there are no inventory costs for Snapdeal. This is also the reason
why the investor community pegs Snapdeal as the most likely of the Big Three to be the
first to make profits.
If you look around globally, large and profitable ecommerce businesses are
marketplaces, be it Alibaba or Taobao [in China], Bahl says. Most companies are
focusing on convenience, but we believe convenience itself doesnt help. The biggest need
is selection. Thats why a pure marketplace is better.
And wide selection is what Snapdeal is betting big on. Its marketplace caters
to over 5,000 cities and towns, offering more than 6,000 brands and has more than 40 lakh
listed products across 500 categories. It has over 25 million members, about 30,000 sellers,
and adds new products every 20 seconds. Our view is that if a customer needs anything,
we should have it, adds Bahl.
Launched in February 2010, Snapdeal has quickly become Indias largest online
marketplace. It claims to have the best prices for products on the back of its marketplace
model. It has also started a two-hour assured shipping format and will deliver products
within 120 minutes if customers are in the vicinity of one of its 40 fulfillment centres.
Snapdeals rise has been unprecedented in the ecommerce sector in Indiait
has been growing at around 500 percent annually compared to the industry average of 80
percent. The company is on track to reach its goal of earning $1 billion in revenue by
2014-2015, says Bahl.
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Last year, eBay partnered with Snapdeal to strengthen its traction in India and
invested nearly $50 million in it. The company intends to make 3-4 acquisitions this
financial year. These acquisitions will mostly be in the space of mobile technology and
data analytics, says Bahl. The companys focus is on building technology that facilitates
ecommerce through mobile devices. It expects 75 percent of its sales to be made from
mobile applications. For us, ecommerce is fast turning into mcommerce [mobile
commerce], says Rohit Bansal, co-founder and COO, Snapdeal.
Binny Bansal (left) and Sachin Bansal, co-founders of Flipkart, aim to corner
every product category in the market
The company is tapping customers in non-metros and tier-II and tier-III cities;
60 percent of its sales come from these areas, and Snapdeal is hoping to widen its reach.
Urban India has access to offline stores. Our focus is on places where they cant get the
product they desire, says Kunal Bahl.
But as Snapdeal achieves greater scale, the challenges of managing logistics
will catch up with it too. Mukul Singhal, vice president of SAIF Partners, a stage-agnostic
investment firm, which has funded portals such as FirstCry, Zovi and Urban Ladder, points
out that integrating vendors with technology is a crucial aspect of the marketplace model.
Many a times, vendors are not ready for such integration because they dont
have the resources for it. A marketplace model like Snapdeal needs to ensure that
technology integrations work seamlessly, says Singhal, adding that a companys
technology platform should not become a hurdle for new vendors or for those who are not
tech-savvy.
Any hitch here will make it difficult to keep track of products that are returned
or payments that are not made. This could lead to a loss of money or product for the
vendor. And rattling the vendor who, for the E - commerce player, is king. Sellers, beware!

FLIPKART: LEAD CATEGORIES :


Late last year, Bangalore-based Flipkart set its eyes on online fashion retailing,
a fast-growing segment. In May, it bought Myntra, the largest-ever acquisition in the Indian
ecommerce space. Together, the two firms have over 50 percent share in online fashion
retailing in India. In the long term, they aspire to occupy 60-70 percent of all online
transactions in this space.
This acquisition cannot be considered in isolation. It, in fact, holds a torch to
Flipkarts future plans. Fashion will be the largest category for Flipkart in the next few
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years and for ecommerce in general as well. We, at Flipkart, believe that we should be
growing every category and we want to be the leader where we are present in, Sachin
Bansal, co-founder and CEO of Flipkart, tells Forbes India. He plans to invest over $100
million in the fashion category over the next 12-18 months.
Started in 2007 by two friends, Sachin and Binny Bansal, Flipkart is valued at
nearly $2.5 billion. Its ecommerce platform offers over 15 million products across more
than 70 categories. It has 3,000 sellers, 18 million registered users, and 3.5 million daily
visits. It makes 5 million shipments per month.
We are already leaders in the organised books market as well as the consumer
electronics space. We intend to build further depth in these and enter new ones, says
Sachin. The company will scale up its supply chain and technology, and launch more
customer-friendly features such as extended replacement guarantee period and priority
customer service.
Despite urging, Flipkart is keen to keep its future plans under wraps. One of its
early investors, Accel Partners, is also unwilling to answer specific questions on Flipkart.
But Subrata Mitra, a partner at Accel, does indicate a broader perspective. At Accel, we
have made investments in home and furniture, jewellery and groceries. All these categories
come with their own unique advantages and challenges, yet have the potential to become
large players in Indias ecommerce story.
There is a contrarian view, though, that Flipkart could be running the risk of
spreading itself too thin by entering multiple categories. Singhal from SAIF Partners says
the key to success for a horizontal firm like Flipkart lies as much in bringing new
categories as in killing those product lines that are not working too well. The key is to
start with clear milestones and understand what to kill and when, says Singhal. He gives
the example of Flipkart continuing to sell apparels on its site despite acquiring Myntra.
Last month, when the acquisition was announced, Flipkart promoters had said that both
companies will remain independent.
Like other ecommerce companies, Flipkart is loss-making too. It reported a loss
of Rs 281.7 crore for the financial year 2013, primarily because it upped its spending
significantly to increase top line. In the previous year, it had recorded a loss of Rs 109.9
crore. But Sachin Bansal says profitability is not their immediate focus. Flipkart can stop
investing in supply chain and technology and start becoming profitable immediately, he
says. But that would be a wrong strategy right now. We are in a dominant position, we
should continue to invest, be the leader and grow the market, he says.
It should be noted that it was in 2013 that Flipkart changed its model and
launched a marketplace. This was after a probe by the Enforcement Directorate for alleged
breach of the Foreign Exchange Management Act for possible violation of foreign
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investment rules. India, as of now, does not allow foreign investment in ecommerce firms
selling products directly to consumers but permits it in the marketplace models. In its bid
to adhere to Indian laws, Flipkart has created a rather complex structure. Its holding
company Flipkart Private Limited is based in Singapore and owns Flipkart India Private
Limited, which runs Flipkart.com.
The good news: According to multiple media reports, India is expected to bring
down its FDI restrictions in ecommerce sometime this year. And this could be a gamechanger for the industry.

THE REAL WINNER :


The battle for domination in the Indian etailing space is bound to be protracted.
The outcome is fuzzy but heres whats clear: The spoils of war mostly benefit those for
whom it is being foughtthe consumers. With so many players, its easy for me to get the
best deals. Thanks to all the discounts and daily offers, sometimes I save as much as 50-60
percent on a purchase, says Ivan Pereira, 30, marketing manager with a Bangalore-based
apparel brand.
The entry of Amazon has brought an added sense of urgency and
competitiveness in the industry, say experts. This is visible in the aggressive advertising in
the space. Spends on marketing and promotion have gone up significantly and
communication to the customers is more intense, says Pragya Singh, associate vice
president, retail & consumer products at Technopak Advisors. In future, pure-play etail
will dominate in India, unlike in the US and UK where the penetration of organised retail is
way higher, she says. For her, Amazons competition isnt its global rival eBay but homegrown retailers who understand the Indian landscape better.
With their sights clearly set on the long term, for Amazon, Flipkart and
Snapdeal, there is only one objectivecustomer acquisition. While the cost of acquisition
is spiralling skyward thanks to their capital-intensive investments across the board, for
Anupam Gupta, a 40-year-old finance professional, the USP of each player is clear. I go to
Flipkart only for books and things like computer peripherals and mobile accessories. In
India, Amazons site is same as that in the US. The service is smooth and cancelling orders
is a breeze, says Gupta, whose choice is not determined by discounts.
Mahesh Murthy, venture capitalist and co-founder, Seedfund, also believes that
Amazon is here for the long haul. Amazon has already grown to about a third of Flipkart
by spending one-tenth of what they did, he says. They [Amazon] had problems in China
due to various reasons there are hardly any English speakers and the web rules are
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stricter. India is a far more aligned market for them, almost a subset of their US one, adds
Murthy.
There are, however, others who believe Flipkart stands a better chance here.
This will be a more concentrated fight now, says Aashish Bhinde, executive director
(Digital Media and Technology), Avendus Capital, an investment bank. Flipkart has a
strong lead as of now but it will need to continue innovating and wowing its customers to
maintain that position.
The broad point both investment bankers and investors agree on is that the
Indian ecommerce market will accommodate multiple large firms but the endgame will
belong to global companies with uninterrupted access to capital.
As Deepak Srinath, director, Allegro Capital Advisors, points out: Of the three,
Flipkart is the strongest brand right now. But in the long term, Amazon will lead over the
others on the back of its expertise, technology and access to capital. Amazon does not need
to raise capital from outside in the next 10 years.
Vish Narain, country head, TPG Growth India, a private equity firm, says its
important to assess how much more money is required by these firms to reach a scale of
$10 billion or above. Global ecommerce giants like Amazon and eBay are here, so unlike
China where local companies have thrived, the success of these [home grown] firms is not
guaranteed, he says.
But the only guarantee that these firms are currently seeking is opportunity.
With Nasscom estimating the Indian ecommerce industry will reach $100 billon by 2020,
they have that assurance in hard numbers.

SNAPDEAL BEAT FLIPKART ON BIG SALE DAY :

With the mixed response on social media platforms to Flipkart's Big Billion Day sale
and Snapdeal's sale on October 6, a Mumbai-based social media and research agency has published
a brief analytics report.

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The Team Pumpkin report, titled "#Flipkart vs #Snapdeal; The Social Media Angle", is
about the much-hyped sales that created records for the Indian E - Commerce industry.
According to the report, Snapdeal, which had created a buzz by hosting a quiz ahead of
the sale on October 6, got great traction during the morning across social media platforms, but
Flipkart still kept leading throughout the day. It adds that the Flipkart mentions on social media
were much more than the Snapdeal in the evening time.
The report also noted Flipkart was over the course of the day subjected to a larger
backlash, with roughly 21 percent negative mentions, roughly 55 percent neutral mentions, and
roughly 25 percent positive mentions. Although Snapdeal had lower mentions overall, it had a
higher percentage of positive mentions, at roughly 31 percent. It had roughly 9 percent negative
mentions, and 60 percent neutral mentions.

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Both Flipkart and Snapdeal had taken out advertisements on a large scale to publicise
their campaigns. Snapdeal even took a dig at Flipkart's 1-day Big Billion Day scheme with its
tagline, "For others it's a big day. For us, today is no different".
In terms of gender engagement, males dominated. Snapdeal had a higher female to
male gender ratio compared to Flipkart. It had about 21.9 percent female engagement to Flipkart's
18.5 percent.
After the sale, when Flipkart claimed it sold products worth $100 million (over Rs. 600
crore) within 10 hours, Snapdeal said that its sales were worth Rs. 1 crore a minute in 10 hours which translates into a figure similar to Flipkart's.
Snapdeal claimed that it sold 10 products per second across categories between October
3 and October 5 but did not disclose the total sales value. The company said it sold a smart phone
every 6 seconds, a laptop every 20 seconds, a tablet every 30 seconds, a saree every 30 seconds, a
pair of footwear every 10 seconds, etc.
Detailing the reasons behind the report, Team Pumpkin said, "The day begun with one
of the most interesting ad wars in the front pages of leading newspapers of recent times. It ended
happily for both Flipkart and Snapdeal clocking their highest sale in a single day and making a
history in the Indian e-commerce space. What happened in the middle, however, is something that
Indian consumers will remember for long! Whether it was Flipkart's failure to live up to people's
expectations in terms of discounted merchandise availability or Snapdeal's Quiz which helped in
trending # Check Snapdeal Today or people sitting across their homes and offices refreshing their
pages every hour to check for an interesting deal, Indian e-commerce surely had many lessons to
learn. One for sure, that you cannot take your customers for granted. Flipkart did that and was
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subjected to massive backlash across social media for price changes, merchandize unavailability
and even technical "Page Not Found" errors. Snapdeal, in the meanwhile, did an amazing job with a
well placed quiz, hourly set of offers and neat execution of the day long activities. Another well
learnt lesson was not to spill the beans too soon. Flipkart revealed the date in advance and the
competition took the best advantage out of it. Nevertheless, the day ended well for both the ecommerce players with both of them clocking their highest sales, and setting up best examples for
the Indian e-commerce industry".

CONCLUSION
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From the above data it can be conclude that consumer buys goods from the
online shopping website on the basis of factors like offers and discounts, variety
of product available, free home delivery, website user friendliness and cash
of delivery payment option.
The hypothesis framed for the project Consumer Perception towards Online
Grocery Shopping was Online grocery shopping stores are beneficial for the consumer.
From the above data analysis it can be determined that most of the respondent
would agree to buy grocery online rather than shopping of grocery with the traditional
method.
Out of the agreed respondent to buy online grocery, most of the respondent
would think that it would be beneficial to shop grocery online on the basis of factors like
easy to order, variety, discounts/ offers, saves time and avoid long queues.
With above analysis we can thus prove the hypothesis to be positive.
The recommended business operation will not only beneficial for the consumer
but also to the firm, as it allows the firm to maintain its low operating expenses and for the
consumer.
Snapdeal is a story that comes from smart work and an it is possible attitude.
There is a need to for a couple of more stories like these and there would be no cribbing
about Indian E-Commerce not working.
Their aim is to make Snapdeal synonymous with the shopping experience in
India.
E-commerce in India has a huge potential going forward and this is just the
start. They have a lot of work ahead of us if they are to fully realize this potential they
feel it will be some time before they actually look overseas.
The USP of Snapdeal is to provide the consumers with the best online shopping
experience. The company aims to provide its customers with good value and wants to be
regarded as one of the most friendly service providers in the domain.
It is also looking to become the biggest e-commerce organization of India while
retaining its focus on serving the customers to the best of their abilities. It will also look to
innovate in this domain and try to expand its offerings so that customers have more to
choose from.These are the reasons why many love Snapdeal.
Flipkart has successfully placed itself into the prospects mind making it the
Indias largest online store with huge range of products. But Flipkart still needs to work on
their core competence that is books and stationery items. With the entry of Snapdeal.com it
will be a huge competitive market for Flipkart and hence will have to position itself better,
as we still see that huge percentage are still unaware of Flipkart.
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Those female who purchase, has a very less frequency which has remained
unchanged. Therefore they need to get aggressive at providing better services which can be
fulfilled by reducing the delivery time, selling second hand products which will increase
consumers affordability much more and enhance penetration into the market.
They can even have their retail stores which can give an access to consumers to
feel and analyze the products, which will help them win the consumers faith. Price will still
be a factor as snapdeal being a huge company will use its economies of scale to remove
their competitors from the market; therefore they need to be more competitive on that
aspect. Be very focused on consumers and build amazing experiences for the customers.

ACKNOWLEDGEMENT

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I take this opportunity to acknowledge the efforts of my individual who


helped me to make this project possible.
I would like to express my sincere gratitude to my Project Mentor Prof.

MUKESH BHATIA for giving me an opportunity to work under his esteemed guidance
which helped me to improve knowledge during the project on COMPARATIVE &

MARKETING STRATEGY OF FLIPKART & SNAPDEAL .


I am very grateful to him for providing me with every possible
opportunity & guidance & sincere cooperation & encouragement which helped me in
completing this project to learn and explore.

BIBLIOGRAPHY

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Google.
www.flipkart.com
www.snapdeal.com
Wikipedia.
Images From Google Images.Com.
Reports.
Advertisements.