What went wrong with snapdeal?

What went wrong with snapdeal?

By,

Jeetendar Peswani

TYBMS –B

9764552185

Jitupeswani199@gmail.com
 What went wrong with snapdeal?

What went wrong with snapdeal?

CHAPTER – 1 INTRODUCTION

E-commerce

About Snapdeal.com
Snapdeal is an Indian e-commerce company based in New Delhi, India.
The company was started by Kunal Bahl and Rohit Bansal in February
2010.Snapdeal was started on 4 February 2010 as a daily deals platform,
but expanded in September 2011 to become an online
marketplace. Snapdeal has grown to become one of the largest online
marketplace in India offering an assortment of 10 million products
across diverse categories from over 100,000 sellers, shipping to more
than 5,000towns and cities in India.Investors in the company include
SoftBank Corp, Ru-Net Holdings, Tybourne Capital, PremjiInvest,
Alibaba Group, Temasek Holdings, Bessemer Venture Partners, IndoUS
Ventures, Kalaari Capital, Saama Capital, Foxconn Technology Group,
Blackrock, eBay, Nexus Ventures, Intel Capital, Ontario Teachers'
Pension Plan, Singapore-based investment entity Brother Fortune
Apparel and Ratan TataSnapdeal acquired FreeCharge for $400 million

CHAPTER – 2 LITERATURE REVIEW

“Study on E-commerce and Online Shopping: Issues and

Influences” by Dr. Anukrati Sharma (2013)
The article entitled “A study on E-commerce and Online Shopping:
Issues and Influences”. In this article an attempt is made to study the
recent trends, influences, preferences of customers towards E-commerce
and online shopping and to give the suggestions for the improvement in
online shopping websites. The study found that, most of the people who
 What went wrong with snapdeal?

are engaged in making the decision of purchasing are in the age of 21-30
years. While making the websites for online shopping it must be
designed in a very planned and strategic way.
2. “E-Commerce in India-A review” by Abhijit Mitra (2013)
The article entitled “E-Commerce in India-A review”. In this article an
attempt is made to study the present status and facilitators of E-
Commerce in India, analyze the present trends of E-Commerce in India
and examine the barriers of E-Commerce in India. The study found that,
there has been a rise in the number of companies taking up E-Commerce
in the recent past. The study also found that, major Indian portal sites
have also shifted towards E-Commerce instead of depending on
advertising revenue.
3. “Future of E-commerce in India”. by Nisha Chanana and
Sangeeta Goele (2012)
The article entitled “Future of E-commerce in India”. In this article an
attempt is made to study the overview of the future of E-commerce in
India and discusses the future growth segments in India’s of E-
commerce. The study found that, various factors that were essential for
future growth of Indian E-commerce. The study also found that, the
overall E-commerce will increase exponentially in coming years in the
emerging market of India.
4. “Emerging Trends of E-commerce in India” by
Sarbapriya Ray (2012)

The article entitled “Emerging Trends of E-commerce in India: Some

Crucial Issues Prospects and Challenges”. In this article an attempt is
made to present a snapshot of the evolution of E-commerce business
indicating the chronological order, category of E-commerce business,
description of organizations involved in E-business in India.
 What went wrong with snapdeal?

Chapter 3 Research Methodology

3.1 Research Problem

1)To try to understand business model of Indian E-commerce

Companies with focus on Snapdeal.

2) To Understand Inconvenient truth about E-commerce in India that

they are Largerly Unprofitable .

3) To study various trends and Challenges faced by E-commerce in

India.

3) Challenges Faced by Snapdeal and how it Finally lost its market

share.

Objectives

1) To understand business model of Snapdeal.

2) To understand Consumer’s Perception regarding snapdeal

3) To study various Challenges faced by Snapdeal and to analyze how

snapdeal lost its market share.

4) To compare snapdeal with its rivals on the basis of Customer

satisfaction.

5) To study satisfaction level of customers towards snapdeal.

Scope of Study

The primary component of research mainly focuses on the consumer’s

perception about snapdeal.com compared to its rivals. Data is collected
mainly from the people between age of 18-25 and residing in Central
suburbs of Mumbai. Secondary data available on Internet is used to
understand reasons behind decline in market share of snapdeal. The
study only focuses on Ecommerce market in India and its challenges
with special focus on downfall of snapdeal.
 What went wrong with snapdeal?

Method of data collection

Secondary data is collected from various websites and journals to

understand major reasons responsible for the downfall of India’s largest
E-commerce website snapdeal.com. This has been used to study the
conceptual framework,definition, present trends and some of the
challenges faced by E-commerce companies in India. All the data
included in secondary base have proper references given wherever
necessary.

.Research design

Research design is the set of methods and procedures used in

collecting and analysing measures of the variables specified in the
research problem research. This research is a combination of descriptive
and exploratory in nature .

Sampling Design

Data is collected from 101 respondents out of which majority of people

are in the range of 18-25.age. Random sample technique is followed and
data is collected from people who shop online.

Limitations of Study

1) Authenticity of seconday data

2) Sample size is limited to 100.
3) The study focus only on snapdeal and E-commerce market in India.
 What went wrong with snapdeal?

Chapter 4 Data analysis and Interpretation

Sample size – Data is collected from 101 respondents out of which

majority of people are in the range of 18-25.

1) Age

60 and above
40-60
25-40
18-25
Below 18

0 20 40 60 80

Out of 101 respondents, 76 people were between the ages of 18-25.and

15 respondents were in the age between 25-40.

2) How often you shop online

Out of 101 respondents, majority shop once in 1- 2 months (37

respondents) followed by once in 3 -6 months

3)Which of the following are your reasons for shopping online?

 What went wrong with snapdeal?

Out of total responses collected , Main reason for shopping was wide
range availability followed by discounts and convenience.

4) Which of the following are your reasons that deter you from shopping
online?

Out of 101 respondents around 43 are concerned about the quality of

product they will be delivered while shopping online,29 respondents
wants to feel product physically before making purchase , 16 people are
concerned about lag between payment and delivery.

5) Which of the following features you like about snapdeal?

35
30
25
20
15
10
5 Series1
0

Majority of people liked snapdeal because of ease of searching item

followed by discounts that snapdeal used to give to its customer
 What went wrong with snapdeal?

6) Which of the following features you do NOT like about snapdeal?

No of
Qualities respondents
Less discount as compared to
other- commerce sites 36
Delayed delivery 22
Lack of Customer support 19
Other reasons 24

No of respondents

Other reasons

Lack of Customer support

No of respondents
Delayed delivery

Less discount as compared…

0 10 20 30 40

The main thing which customers did not like about snapdeal is that it
gives less discount compare to its rivals. 36 out of 101 respondents agree
with this.

7) How do you rate your experience with snapdeal?

No of
Rating respondents
Poor 15
Average 59
Good 25
Excellent 2
 What went wrong with snapdeal?

Out of 101 respondents, 59 rated snapdeal as average on the basis of

overall customer satisfaction ( Convenience, delivery time availability of
products, pricing structure).

8) What are the other e-commerce sites you have shopped from?

Majority of people prefer Amazon and Flipkart for their shopping

requirement.

9)According to you, why snapdeal lost its market share?

Chart Title
150
100 No of respondents
50
0 No of respondents
Column1

Out of 100 respondents 58 people believe that due to Competitive

business environment, Snapdeal lost its Market share.

10) Why did you stop buying from snapdeal?

 What went wrong with snapdeal?

No of Respondents

Unavailability of products

No discounts No of Respondents

Lack of Customer support

0 10 20 30 40

People stopped buying from snapdeal because of lack of customer

support and less discount compared to its rivals.

11) How do you rate Amazon as compared to snapdeal?

Responses
100

0
Better Equal Poor

69% respondents believe that Amazon is better than snapdeal on the

basis of satisfying their requirements (Convenience, delivery time
availability of products, pricing structure)

12) How do you rate Flipkart as compared to snapdeal?

 What went wrong with snapdeal?

Even when compared with Flipkart, 60% people consider it better as

compared to snapdeal on the basis of overall experience while shopping.

100

0 Responses
Responses
Better
Equal
Poor

13) Do you still shop from snapdeal?

Respondents

No

Yes

0 10 20 30 40 50 60 70

14)Why did you stop buying from snapdeal?

Lack of customer support

Unavailability of products
No discounts
Delayed delivery

Due to lack of customer support, less discount and unavailability of

products people had stop buying from snapdeal.
 What went wrong with snapdeal?

Chapter 5 Conclusion and Recommendation

Conclusion

After analysing entire case, we understand that the main reason for
decline in marketshare of snapdeal was because of wrong decisions
taken, lack of value proposition and highly competitive business
Environment

Technology has made significant progress over the years to provide

consumers a better online shopping experience and will continue to do
so for years to come. With the rapid growth of products and brands,
people have speculated that online shopping will overtake in-store
shopping.

Developing countries face many obstacles that affect the successful

implementation of E-commerce compared with developed nation
Convenience is one of the benefit that customer gets from shopping
online and thus increasing customer satisfaction. E-commerce business
should give importance to every consumerby giving smooth service and
should try to have many function online. But E-commerce business
faces a lot of challenges in flourishing their business.

As more and more consumers move to online purchasing more and more
service providers are emerging in this field. But, e-commerce from the
very beginning has been a very difficult and loss making sector due to
its nascent stage and lack of favourable environmental factors in order to
do business. Even though snapdeal had a good customer base but due to
highly competitive business environment it lost its market share and
valuations.

Not having a clear focus or losing focus is the biggest crime in every
business. Indian e-commerce giants should come out of the notion that
 What went wrong with snapdeal?

market share is the primary performance metric. In many ways,

Snapdeal is an important lesson for Indian startups.

Recommendations

1) E-commerce business should not only focus on its customer’s satisfaction

but also try to satisfy interest of sellers. For the success of any E-
commerce business seller play a very vital role .
2) All E-commerce business should have clear Execution plan and they
should set their target in a realistic manner.
3) Business should try to be innovative rather than replicating other person’s
business model.
4) It is the responsibility of owners of business to protect interest of
minority shareholders.
5) Obsess over customers, not competitors
6) Organisations should try to build a culture that it is right for the business

Bibliography

1) Report on India’s Digital Leap–The Multi Trillion Dollar Opportunity

by Morgan stanley
2) Report on E-commerce Retail Logistics India by KPMG
3) Report on Rebirth of E-commerce in India by Ernst and
young.
Webliography

1) https://www.ibef.org/industry/ecommerce-presentation
2) https://en.wikipedia.org/wiki/Snapdeal
3) https://yourstory.com/2017/05/snapdeal-sins/
http://www.livemint.com/Companies/8bzgpgNg8jeDM22YVydk5I/Sna
pdeal-Rise-and-fall-of-an-Indian-unicorn.html
What went wrong with snapdeal?