Mou Nika

1
BUSINESS AND MANAGEMENT
Extended Essay
Word Count :- 3835
Research Question:-
“Will the recent acquisition of Jabong by Myntra provide Flipkart a growth
advantage in the competitive online fashion segment of India?”

ABSTRACT
Flipkart is an e-commerce store founded in 2007. Flipkart which bought Mytra in 2014 also
acquired Jabong in 2016 through its unit Myntra in a cut price deal. Because of this acquisition
Flipkart became one of the top e-commerce website today in India.
Hence this essay explores “ Will the recent acquisition of Jabong by Myntra provide Flipkart a
growth advantage in the competitive online fashion segment of India.”
My primary research contains a questionnaire which was distributed randomly to the customers
who mostly shop online. The data collected helped me understand customer preference and buying
habits. My secondary research consists of newspapers, articles magazines, case studies, websites
and some theoretical information from books which helped me in carrying out an in-depth research
on different fashion e-commerce bushinesses.. From the secondary sources which I have collected
and collated , I tried to analyse the strengths ,weaknesses, threats and opportunities of Jabong. The
research was conducted to analyse the market position of Jabong and Flipkart. This research con-
tains business tools which aided in the analysis like Boston matrix, perception Map, Ansoff Matrix
and marketing theories that were appropriate for the case.
Through my research I concluded that Jabong and Myntra were one of the very few websites known
for online shopping. These together provides Flipkart a growth advantage in the e-commerce fash-
ion segment. The acquisition is expected to be successful only with Flipkart developing a strategy
which would be unique in terms of product and price offerings. The two online fashion business
operates in different segment and Flipkart should take advantage of their operations in different
markets rather pushing ‘exclusive product offerings’ through Jabong. This may disadvantage
Jabong’s product line in the mass market for which it has been known in the past.
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word count: (295)
Acknowledgement
My sincerest thanks to everyone who guided me in writing this research paper and proceed through
it. I would like to express my deepest gratitude to my supervisor, for her guidance and motivation. I
would also like to thank the respondents of my survey who provided material for the further pro-
gression in this essay.
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CONTENTS
1) Introduction/ Rationale: ……………………………………………………………………… 6
1.1) Flipkart: …………………………………………………………………………………. 6
1.2) Company Background: ……………………………………………………………. 6
1.3) Case Definition : ……………………………………………………………………. 6
1.4) Problem background: ………………………………………………………………. 8
1.5) Research Question: …………………………………………………………………. 8
2) Methodology:
2.1) Primary Research: ……………………………………………………………………8
2.2) Secondary Research: ………………………………………………………………….9
2.3) Objectives: .…………………………………………………………………………….9
2.4) Syllabus area covered: …………………………………………………………………9
3) Findings and analysis ……………………………………………………….………………… 10
3.1) Analysis of survey results: …………………………………………………………. 10
4) Analysis of growth advantage for Flipkart through secondary research: ……………….. 13
4.1) Revenue growth………………………………………………………………………14
5) Growth diversity for fashion in Indian market: …………………………………………… 15
6) Analysis of Jabong: ………………………………………………………………………….. 16
6.1) Pre-Acquisition status: ……………………………………………………………… 16
6.2) Post- acquisition status: ……………………………………………………………. 16
7) Jabong SWOT post acquisition: ……………………………………………………………. 17
8) Porter’s five field analysis: ………………………………………………………………….. 19
9) Boston matrix and analysis: ………………………………………………………………… 20
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10) Ansoff matrix analysis: ……………………………………………………………………. 21
11) Perception Mapping:……………………………………………………………………….. 22
12) Conclusion: …………………………………………………………………………………. 23
13) Bibliography: ………………………………………………………………………………. 26
14) Appendices: …………………………………………………………………………………. 28
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1. INTRODUCTION:-
1.1) Flipkart:
Myntra owned by Flipkart acquired Jabong from the global fashion group. Myntra- Jabong deal
was of Rs 2,000 crore deal2. This acquisition of Jabong will strengthen Flipkart group’s position as
the acknowledged leader in fashion and lifestyle segment of India3. This research paper claims
about the growth advantage of Flipkart in the competitive online fashion segment of India with the
acquisition of Jabong by Myntra.
1.2) Company Background:
Founded in 2007 , Flipkart is an e-commerce company and has more than 11.5 million book title
listed, 11 different categories, more than 2 million registered users and sale of 3000 items a day4 .
Jabong was launched in 2012 which is an Indian fashion and lifestyle e-commerce portal. The fash-
ion group sells beauty products, foot wear, fashion accessories , home accessories, fragrances and
lifestyle products.. The e-store consists of more than 1000 brands and over 90,000 products. Myntra
2 “ To boost e-commerce segment, Myntra acquires Jabong”. 26 July 2016,

http://www.tehelka.com/2016/07/to-boost-e-commerce-segment-myntra-acquires-jabong/
33 “Flipkart acquires Jabong from global fashion group.” Outlook: the fully loaded magazine, 26
July 2016,
http://www.outlookindia.com/newswire/story/flipkart-acquires-jabong-from-global-fashion-
group/948008
4 “Get Coupons,Offers and Save Money : Online Shopping - Csdoon.” Csdoon, 24 Nov. 2013,
csdoon.com/get-couponsoffers-and-save-money/.
Page 6
is an another Indian e-commerce company of fashion and casual lifestyle products which was
launched in 2007. Myntra portfolio includes about 1,50,000 products with more than 1000 brands
ranging from international brands to designer brands. In 2014, Myntra merged with flipkart to com-
pete with giant online business like Amazon which entered the Indian market in 2013 and also with
other retailers like future group , Aditya Birla group and Reliance retail 5and other private organisa-
tions like Manish, Neeru’s etc.
1.3) Case Defination:
The acquisition of Myntra by Flipkart brought together two of the biggest e-tailers in India. This
acquisition will enable Myntra to strengthen on Flipkart’s social and economic infrastructure, at the
same time giving a chance to Flipkart to enhance its portfolio of product offering. This merger is
seen as a response to taking on Amazon which has made big plans for Indian market.
Jabong has been in the market for sell off and was in discussion with companies including Future
Group, Snapdeal and Aditya Birla-owned among others. The acquisition of Jabong is a natural step
taken by Myntra to become India’s largest E-commerce Fashion plat-
form6.
5 “Style up: the Myntra Way - KnowStartup.” KnowStartup, 6 Aug. 2015,

knowstartup.com/2015/08/style-up-the-myntra-way/.
6“Myntra Acquires Jabong from Global Fashion Group.” Jammu Kashmir Latest News | Tourism |
Breaking News J&K, 26 July 2016,
www.dailyexcelsior.com/403569-2/.
Page 7
1.4) Problem Background:
The acquisition of Jabong by Myntra is believed to further strengthen Flipkart Group’s position as
the acknowledged leader in fashion and lifestyle segment of India, especially at a time when it is
facing stiff competition from Amazon India7. Hence my research paper explores the growth advan-
tage of the acquisition.
1.5) Research question:-
2) Methodology:-
2.1) Primary research:-8
Primary research was conducted by distributing questionnaires which is focused on the company
and on fashion segment of India. The primary data was conducted through surveys and personal
interactions with the users of the e-commerce shopping. A detailed study was made further to iden-
tify the growth advantage of Flipkart with the acquisition of Jabong by Myntra. The data collected
were used to understand the online buyers perception on the two companies and their views on the
merger.
7 “Making sense of Myntra's acquisition of Jabong”. Exchange for media.com, 27July2016.

http://www.exchange4media.com/digital/making-sense-of-myntras-acquisition-of-
jabong_65379.html
8 Refer to appendix 1( questionnaire to online shoppers)
Page 8
2.2) Secondary Research:-
Articles from magazines, newspapers, websites and other researches are used to understand the
growth prospects and success factor of the deal. The factor that are adverse and the position that
merged entity would hold ‘ post acquisition’ for Flipkart in the fashion segment.
2.3) Objectives:
- Preparing a SWOT analysis of Jabong for the better understanding of strengths, weaknesses,
threats and opportunities of the deal.
- Analysing growth advantage for Flipkart after the acquisition.
- Connecting it through Porter’s five field analysis and to understand how they affect the deal.
- Preparing Boston matrix, Ansoff matrix and perception mapping and analysing them for better
understanding of the strategies that could lead to success of the deal.
2.4) Syllabus area covered:-
- SWOT9
- Porter’s five force field analysis 10
- Boston Matrix11
- Perception mapping 12
- Ansoff matrix13
9 Hoang, Paul. “Business and management.” Reprint. Victoria:IBID press, 2014. print, pp 40-42
Page 9
3) Findings and Analysis
3.1) Survey Analysis
Graph 1-Result of the question- How often do you purchase online?
The pie chart shows that maximum number of people shop at least once a month making e-com-
merce as preferred as the retail shops. This provides an opportunity to the e-commerce companies
like Jabong to extend their market share.
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Graph 2- Result of the question- What would you prefer the most for online purchase?14
apparels electronics
books and more home and furniture
A bigger concern is the dominance of electronic’s fashion and books are the ones which are mostly
preferred buy the buyers. These three categories account for staggering 88% of online shopping.
It is evident from the above bar chart that electronics and appliances hold the largest share in e-
commerce industry. “India’s e-commerce market is likely to touch $38 billion mark in 2016, a per-
cent jump over $23 billion revenue it clocked last year,” according to the associated chambers of
commerce and industry.
Increasing internet and mobile penetration, growing acceptability of online payments and
favourable demographic has provided the e-commerce sector in India the unique opportunity to
connect with their customers.
14 Refer it to Appendix 1 (questionnaire to online shoppers)

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Graph 3: Result of the question- Are you happy with deals and offers made by Jabong15
yes no
Region 2
In graph 3, The survey result states that most people prefer Jabong due to its offers and discounts.
The survey result attached in the appendix state that most online buyers to Jabong are female cus-
tomers who prefer the website due to its product line and heavy discounts.
As per associated chambers of commerce and industry, there was an increase in internet and mobile
usage for online purchases , increase in acceptance of payments that are made online and favourable
demographics, which has provided e-commerce companies an opportunity to connect with their
customers.
15 Refer to appendix 1 (questionnaire to online shoppers)

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4) ANALYSIS OF THE GROWTH ADVANTAGE FOR FLIPKART:-16
Recent statistics show that Flipkart is been recognised as the most preferred e-store whereas Myn-
tra being a least preferred e-store. Flipkart being in tough competiton with Amazon . has gained a
position in terms of customer base growth advantage by acquisition of Jabong which has a high
market place in India than Myntra.
Amazon, equipped with a well oiled machinery is ready to battle against all users of E-commerce in
India. Now that, Myntra , Flipkart and Jabong are together as one entity it will be a tough time for
Amazon to face this.
This Acquisition further cements the flipkart company as the acknowledged leader of online fash-
ion in India. This will also unlock the next level of growth for Myntra and Jabong. It will benefit the
entire online fashion industry most importantly the customers.
Page 13
Consistency of experience came up as the single most important reason for preferring one site. The
second most important factor17 is service and delivery.
The third and most important element given by the online retail sites are discounts and offers. Most
of the customers are preferring online shopping only because of discounts. However, this reduces
the profitability of the e-stores and improves an unnecessary competitions and leads to price war.
4.1) 18 Revenue Growth
In Jabong’s case, after it began cutting discounts and costs last year, gross profit margin has im-
proved. Till December 2014, Jabong had a loss at gross margin level, amounting to 19.7% of net
revenue, which fell to 5.4% in 2015. In the January to March quarter of 2016, it managed a break-
even at the gross profit level.
Nair Radhika, “YS Research: India’s favourite online shopping brand revealed” yourstory.com , 17 August 2015,
https://yourstory.com/2015/08/indias-favourite-online-shopping-brand/
Philipose Mobis, “Jabong may be Flipkart’s best investment yet”, livemint.com 17 July 2016
http://www.livemint.com/Money/MpDsvuJOVdxOiskvMcrIkI/Jabong-may-be-Flipkarts-best- investment-yet.html
Page 14
With lower competition in the fashion and apparel segment, the Myntra-Jabong combine can reduce
discounting and work towards being profitable. Besides, given the high market share, it is one seg-
ment in which it can clearly give Amazon a run for its money.
In 2014, Gross merchandise value of flipkart was about 34 per cent which is mostly from electronic
gadgets, followed by fashion that has a GMV of 30 per cent.
This GMV is expected to further the % age growth in the apparel sector of flipkart.
5) GROWTH DIVERSITY FOR FASHION IN INDIAN MARKET 19
A survey was conducted on 120 people at random in 3 metropolitan cities and 4 towns of India to
evaluate the trends of apparels for working women, fashion conscious people and casual wear.
The growing working women in the Indian society has resulted to demand for suits/dresses and lin-
geries.
This segment can be identified as regular online buyers who look for a range of product line but
definitely expect competitive pricing and discounts.
The fashion conscious men and women is the next segment which looks for more online than off-
line purchases. This segment however does not look for high discounts but expect a range of brands
both in ethnic and western wear. Growing urbanisation and average middle class Indian has raised
demand for mens and women’s wear both in the casual and ethnic segment.
Form and way of life is one of the greatest drivers of web based business development in India. We
have dependably had confidence in the mold and way of life fragment and Myntra's solid execution
19 Refer to Appendix 1
Page 15
has strengthened this confidence. This securing is a continuation of the gathering's trip to change
business in India.
6) Analysis of Jabong:-
6.1) Pre-acquisition status:20
Jabong had been only the loss making company in global fashion group portfolio of ten companies.
It has reported an operating loss of INR 426 crore 2015. Though the e- commerce business has
showed growth of 7% increase in its revenue rising to INR 866 crore in 2015, It’s value collapsed
due to heavy discounts, leadership issues, loss in market share.
6.2) Revival post acquisition:
Market experts are of the view that despite the loss and debt burden that Jabong faced, Flipkart is
in a strong position of owning fashion line goods compared to all other general merchandisers. The
margin at which fashion industry works is much higher than any other product line in the e- com-
merce sector. Jabong has worked on re-structuring the business by hiring top leadership team. It has
announced to cut down low margin brands and focus on customers who offer greater profits. How-
ever, Jabong
20"Jabong's Parent Company Global Fashion Group Secures EUR 300 million." The Financial Ex-
press. 04 May 2016. Web. 19 Jan. 2017.
<www.financialexpress.com/industry/jabong-parent-gfg-gets-300-mn-euro-funding-from-r
ocket-internet/247268/>
Page 16
may loose a large customer base due to this as the e- commerce business had been popular in the
past due to its heavy discount offerings. A change of strategy may misfire.
7) JABONG’S SWOT21 POST ACQUISITION:22
STRENGTHS WEAKNESSES
- Strong brand positioning with Myntra - Reduced discounts post acquisition

- Reduced competition post acquisition - Focus on exclusive brand line post acquisition
- The product assortment of 1580 brands. - Reduced product line.
- Fast delivery - Huge losses in the past.
- Open box delivery
- Cash on delivery
- Easy return
OPPORTUNITIES THREATS
- Growth of Indian apparel market expected in - The world’s largest online retailer, Amazon has
four-fold by 2025 to attain a size of $200 billion. set up their business in India.
- Indian has fastest internet traffic growth globally. - Huge Competition with local e-commerce com-
- IAMAI report states apparel year on year growth panies.
of 84%. - Lack of internet connectivity in rural India.
- Life style of Indian prospering urban population.
- Growth of online buying.
Though the SWOT analysis drawn describes the strengths of Jabong that had lead to its past suc-
cess, its reduction in product line and discount offerings which has been its USP ( Unique
Selling Point) in the past has lead to challenges. Also the market had become more competitive
since then with entry of giant e-commerce businesses like Amazon and local online apparel
companies like Neeru’s, Ritu’s etc.Indian market provides a great prospect for the online apparel
business with the trend of e-commerce business catching up in the urban sector.
22 Chanchani Madhav, “ Amazon pips snapdeal to become India’s 2nd largest online marketplace
after Flipkart.” Economic times.com, 28th April 2016.
<economictimes.indiatimes.com/industry/services/retail/amazon-pips-snapdeal-to-become-i
ndias-2nd-largest-online-marketplace-after-flipkart/articleshow/52017176.cms>
Page 17
Also, the industry had shown Myntra could be in a win-win state post acquisition through strategic
planning in the growing market. Complete removal of discounts and offers may lead to buyers
switching over to other multinational and local e-commerce brands as Indian customers are price
sensitive buyers. Jabong has worked on re-stricturing the business by hiring top leadership team. It
has announced to cut down low margin brands and focus customers who offer greater profits. How-
ever, Jabong may loose a large customer base due to this as the e-commerce business had been pop-
ular in the past due to its heavy discount offerings only.
Page 18
8) Porter’s five force field analysis:-23
To understand Jabong’s position post acquisition a force field analysis is made.
1. Most apparel companies have 1. High scope for growth of Apparel business
powered to forward integrate online.
like AdityA birla, Future Group, 2. Entry of small players like Neeru’s.Biba,
Reliance Trendz. Threat Entry Manish due to low investment.
2. Price discrimination is possible (High) 3. The effect of new entry as Jabong may be
with different discount models. low due to the industry experience and
3. Jabong has an advantage of brand recall.
bulk buying here to its inventroy-
based model.
4. Partnering with suppliers like
Topshop, Doroking,
Buying
power
(High)
Buying power
of supplier
(Low)
PORTERS 1. Jabong proposes to filter present items

FIVE to make customer choice easy.
1. Jabong not only compete with e- 2. reduce transaction time to 5 to 6 min-
commerce business but also FORCES utes.
traditional retail shoes of India. 3. Easy payment options like cash on de-
2. The competition is more from livery and EMI
indigenous Fashion brands.
Intensity of 1. weak switching cost

from one e-commerce Threat sub-
competition stitue
company to other.
(Low) (High)
2. Popularity of traditional
shores still existing in
India.
Page 19
The above analysis is made for Jabong to analyse the market forces for growth. Though the busi-
ness has high buyer’s bargaining power, the post acquisition strategies may be extensively used by
the company to facilitate buying and retain is customer base.
The future in apparel segment of India provides prospects for more competition. Jabong needs to
maintain its ‘differentiation’ strategy offering to sustain the competitive market. The present con-
centraten ratio of Jabong and Myntra provides it a great market advantage. However if the business
over looks the buyers advantage, it is likely to loose its future market and brand equity.
9) BOSTON MATRIX:-24
STARS PROBLEM CHILDREN
- Casual Wear - Ethnic Wear ( Salwar kameez, palazzos)

- Denim
- Formal Wear
CASH COWS DOGS
-Other accessories like bags, shoes, jewellery - Jackets

- Sweaters
- T-Shirts
- Lingeries
- Kidswear.
A Boston matrix had been developed to understand the product portfolio offered by Jabong post ac-
quisition.
The matrix states Jabong’s product wise sales which shows maximum revenue is generated pre and
post acquisition from casual wear since jackets and sweaters are only in seasonal demands and T-
24 Refer to appendix 1
Page 20
Shirts and lingeries which are purchased mostly by buyers offline are product which only add to the
range without much contributes to the revenue.
If Jabong removes discounts and adds more high end product line, revenue from this segment may
be effected. Rather Jabong should reduce its product line of ‘dog’ products which are hosiery prod-
ucts and lingeries which blocked unnecessary funds in stock. Since ethnic wear has huge prospect
in the Indian market, the product line of prestigious Indian designers like Manish Malhotra,
Neeru’s, Ritu’s ,etc could be added along with other multinational brand.
The purpose of drawing the above matrix is to evaluate the effectiveness of the present product line
for Jabong and suggest measure that would prevent the e-commerce company from loosing a large
base of customers.
However, Boston Matrix tool only provides a synopsis of firms product portfolio and it fails to ex-
plain the position of each product in the grid. Jabong pre- acquisition generated high market share
but yet incurred heavy losses due to discount offering.
To further make an in depth analysis, Ansoff Matrix drawing tool will be applied.
10) ANSOFF MATRIX:25
Pre acquisition:
25Stimpson, Peter, and Alex Smith. Business and Management: for the IB Diploma. Cambridge:
Cambridge UP,
2011. Print.
Page 21
Jabong had a market penetration strategy by altering heavy discounts on a large number of product
line. This strategy though generated huge volume of sales, at the same time incurred heavy debts.
Some of the products were offered at par with the cost price and sometimes even lower
Post acquisition:
The company did not wish to repeat the mistakes post acquisition and changed its strategy to market
development. The focus was a clear ‘differentiation strategy’ by acquiring high end brands like Top-
shop, Doro king other than the regular brands. The large offering at Jabong pre acquisition has been
reduced to facilitate customer buying rather surfing 1000 brands unsuccessfully. however, Jabong
hold’s an image of low end brands and due to this, to what extent the exclusive and differentiated
strategy would be successful is questionable.
9) PERCEPTION MAPPING: 26
26 Refer Appendix 2 (Interaction with the users of e-commerce shopping)

Page 22
The fashion brands have an equal spread in the perception map. This shows thats they can cater to
different sections of society as per their needs/satisfaction. Myntra is placed as the brand with the
highest price as well as high mass market, thus making it a premium product. This shows its success
in over powering the online fashion segment. As Myntra acquired Jabong, it gives Jabong a raised
advantage in spite of remaining in the low mass market and low price segment.
Jabong in the pre-acquisition period is positioned as an online company which mostly deals in ap-
parel for masses. Heavy discount offerings has labelled the business for masses. Myntra however
also maintained products lines which had same exclusive offering. Post acquisition, Jabong is ex-
pected to be positioned along with Myntra as it intends to add exclusive brands and reduce dis-
counts.
This companies strategy may provide loss of huge customer base. Therefore, Jabong needs to con-
tinue in the same market to cater to the masses and the exclusive line should be left to Myntra. This
way, both companies can create a high concentration ratio of market share by operating in different
market segments.
10) Conclusion:-
Jabong’s acquisition by Myntra provides a different marketing dynamics where Myntra is known
for its high price and high quality clothes and Jabong being popular for fast fashion clothes with
very frequent updates in their clothing line with heavy discounts and a lot of deals. This tie up will
provide a greater market share in the fashion segment. Thus, my research question “Will the recent
acquisition of Jabong by Myntra provide Flipkart a growth advantage in the competitive on-
line fashion segment of India?” was deduced.
Page 23
Flipkart is undoubtedly provided with an advantage in the competitive online fashion segment as
Jabong and Myntra were two of the very few websites known for online fashion shopping in India.
Amazon’s international presence can be counted upon as a back support for Amazon being a popu-
lar choice amongst consumers, which is not threatened by the Jabong-Mynta acquisition. The
growth of apparel market by 84% (IAMAI report) will act in favour of this acquisition providing
Flipkart just the opportunity that they require to move forward in the online fashion shopping mar-
ket in India.
Jabong’s competitive discount pricing strategy will also prevent loss of customers to Amazon’s dis-
count strategies. Jabong’s financially weak past can be improved by the current standings of Flip-
kart and Myntra through their current positive growth status and Jabong’s market presence and im-
age that will provide Flipkart and Myntra with the base they need to become leaders in the Indian
online fashion market.
For Flipkart-Myntra, the acquisition of Jabong will boost sales at a time when Flipkart is struggling
to revive growth, and struggling to protect its leadership in a market where Amazon has made rapid
strides. Jabong offers more than 1,500 international high-street brands, sports labels, Indian ethnic
and designer labels and over 150,000 styles from more than 1,000 sellers27. The diversity that this
acquisition provides should be carefully directed by Flipkart. The sheer sales volume provides Flip-
kart enough opportunities for growth.
27“Myntra a FlipKart Ltd. Unit Acquires Jabong for $70 Million.” WebPro Technologies - SEO India,
11 Sept. 2016,
www.webpro.in/myntra-flipkart-ltd-unit-acquires-jabong-70-million/.
Page 24
Firstly Flipkart might also want to change Jabong’s image similar to Myntra and to increase the
products offered with an increase in specific consumer segment. Secondly Jabong’s operational and
functional structure can be similar to the previous structure with inflow of resources from Flipkart
and Myntra letting Jabong operate in the similar way it has been operating.
A suitable direction that Flipkart might take is to go ahead with the competitive discount pricing
and let Jabong operate with the same strategy and brand image that Jabong is known for. This is a
recommended step as Mynta -Jabong together occupy a greater market share and tamper different
consumer segments. In any scenario Jabong helps Flipkart to retain its market leader position which
is one of the major reasons this acquisition is being considered a win-win situation. Jabong’s future
is now rested upon Flipkart’s utilisation of the market share and its vision for Jabong.
For my research I have used snowballing and random sampling . Though I have tried to ensure that
the segment is representation of the Indian population, however there is bias expected in respon-
dents view that could limit the validity of my research. I have tried to extensively use secondary
resources and customers blogs to validate my research findings. Tools like force field analysis is
drawn based on secondary sources and survey results. Boston matrix is drawn on online demand of
products/ customer service which may limit 100% accuracy of results.
Page 25
Bibliography:
Print source:-
Hoang, Paul. “Business and management.” Reprint. Victoria:IBID press, 2014. print
Stimpson, Peter, and Alex Smith. Business and Management: for the IB Diploma. Cambridge: Cambridge UP,
2011. Print.
Web Sources:-
“Flipkart acquires jabong from global fashion group.” Outlook: the fully loaded magazine, 26 July
2016, < http://www.outlookindia.com/newswire/story/flipkart-acquires-jabong-from-global-fashion-group/
948008 >
“Get Coupons,Offers and Save Money : Online Shopping - Csdoon.” Csdoon, 24 Nov. 2013,< csdoon.com/
get-couponsoffers-and-save-money/.>
"Jabong's Parent Company Global Fashion Group Secures EUR 300 million." The Financial Express. N.p.,
04 May 2016. Web. 19 Jan. 2017.
<www.financialexpress.com/industry/jabong-parent-gfg-gets-300-mn-euro-funding-from-r
ocket-internet/247268/>
<www.livemint.com/Money/MpDsvuJOVdxOiskvMcrIkI/Jabong-may-be-Flipkarts-best-investment-
yet.html >
“Myntra Acquires Jabong from Global Fashion Group.” Jammu Kashmir Latest News | Tourism | Breaking
News J&K, 26 July 2016, < www.dailyexcelsior.com/403569-2/.>
“Making sense of Myntra's acquisition of Jabong”. Exchange for media.com, 27July2016.
<www.exchange4media.com/digital/making-sense-of-myntras-acquisition-of-jabong_65379.html >
Page 26
Myntra a FlipKart Ltd. Unit Acquires Jabong for $70 Million.” WebPro Technologies - SEO India, 11 Sept.
2016 < www.webpro.in/myntra-flipkart-ltd-unit-acquires-jabong-70-million/.>
“Style up: the Myntra Way - KnowStartup.” KnowStartup, 6 Aug. 2015,
< knowstartup.com/2015/08/style-up-the-myntra-way/.>
“ To boost e-commerce segment, Myntra acquires Jabong”. 26 July 2016,
< www.tehelka.com/2016/07/to-boost-e-commerce-segment-myntra-acquires-jabong/>
< yourstory.com/2015/08/indias-favourite-online-shopping-brand/ >
Appendices:-
Page 27
Appendix 1:-
A survey was conducted on 120 people at random in 3 metropolitan cities and 4 towns of India. Primary re-
search was conducted by distributing questionnaires which is focused on the company and on fashion seg-
ment of India.
Graph - 1: Result of the question - What would you prefer the most for online purchase?
Graph-2: Result of the question- What do you prefer the most?
shopping online At store
Region 1
Page 28
Graph-3 Result of the question- Which e-commerce website would you prefer the most for fashion
yes no
Region 2
Graph-4 Result of the question- Are you happy with the deals and offers made by Flipkart?
Jabong Amazon Myntra

Flipkart
Region 1
Page 29
Graph-5 Result of the question- Are you happy with the deals and offers made by jabong?
yes- 70%
no-30%
yes no
Region 2
Graph 6- Have you ever made apparel purchases from Jabong?
yes- 63%
No - 37%
Region 1
yes no
Page 30
Graph 7- What attracts you the most in online purchase?
discounts- 39%
quality-11%
product line- 10%
Delivery-40%
Region 1
discounts product line
Graph8- What would you look forward for e-tail business in fashion segment for online
buying?
more discounts- 73%
more products- 27%
Graph 9-Why do you prefer online buying?
payment options- 50%

Page 31
Region 1
more discounts more products

fast delivery- 30%
product line- 20%
Region 1
payment options product line

Graph 10-What is your age group?
18-25- 35%
25-30- 18%
30-40- 10%
40-50- 14%
region
Page 32
18-25 30-40 above 50

above 50- 23%
Graph 11-What do you prefer the most?
Cash on deilvery- 50%
credit cards- 30%
debit cards- 20%
Region 1
cash on delivery debit cards
Graph 12 - Result of the question- What would you prefer the most for online purchase?
Apparels- 30%
Electronics- 40%
Books and more- 18%
Home and furniture- 12%
APPENDIX 2 :-
Page 33
The primary data was conducted through surveys and personal interactions with the users of the e-
commerce shopping
1. what do you perceive about the prices of Myntra?
very low low

neutral high
very high
10%
40%
30%
20%
2. what do you perceive about the prices of amazon?
3. if given a choice amongst the mentioned brands, which one do you think is most expensive?
Page 34
Jabong
very low Myntra
low
Voonik
neutral SSS high
Aurelia
very high Amazon
limeraod
13%
27% 18%
38%
25%
9%
36%
9% 25%
4. Have you had any delivery issues with any of the following?
voonik aurelia
amazon SSS
Jabong Myntra
Limeroad
17% 8%
25%
33%
17%
5. Which online site are you most likely to use? rate them accordingly with 1 being the most likely
Page 35
- Myntra- 5 persons choose Myntra as the most likely visited site.
10-30 30-50
50-70 70-80
80-100
40% 40%
20%
- Jabong- 3persons choose jabbing as the most likely visited site.
10-30 30-50
50-70 70-80
80-100
33%
67%
- Amazon- 2 person
Page 36
10-30 30-50
50-70 70-80
80-100
50% 50%
Appendix 3:-
Flipkart-owned Myntra today said it has acquired Jabong from Global Fashion Group for an
undis“Fashion and lifestyle is one of the biggest drivers of ecommerce growth in India. We have
always believed in fashion and lifestyle segment and Myntra’s strong performance has reinforced
this faith,” Flipkart CEO and co-founder Binny Bansal said.
This acquisition is a continuation of the group’s journey to transform commerce in India, he added.
“The acquisition of Jabong is a natural step in our journey to be India’s largest fashion platform. We
see significant synergies between the two companies especially on brand relationships and con-
sumer experience. We look forward to working with the talented Jabong team to shape the future of
fashion and lifestyle ecommerce in India,” Myntra CEO Ananth Narayanan said.
Page 37
Jabong has been in the market for a sell-off and was in discussion with companies including Future
Group, Snapdeal and Aditya Birla-owned Abof among others.
Jabong was founded in 2012. In September 2014, its investor, Rocket Internet merged Jabong with
four other online fashion retailers in Latin America, Russia, the Middle East, South-east Asia and
Australia to create Global Fashion Group (GFG).
Swedish investment firm Kinnevik also owns a large stake in Jabong’s parent Global Fashion
Group.
While Jabong has managed to reduce losses by reducing discounts, both Kinnevik and Rocket In-
ternet seem unwilling to infuse fresh capital and are believed to be keen to exit.
In April this year, GFG raised fresh funding from existing investors at a lower valuation, raising 300
million euros from Rocket Internet and Kinnevik.
Post the last round, GFG was valued at 1 billion euros, a significant fall from earlier valuation of
3.1 billion euros.
According to the Internet and Mobile Association of India, e-tailing has grown at 57 per cent year-
on-year, moving from Rs 24,046 crore to Rs 37,689 crore between the December 2014 and Decem-
ber 2015. This is further estimated to touch Rs 72,639 crore by end of 2016.
As per a Rocket Internet investor presentation, Jabong had a net revenue of 32.6 million euros in Q1
2016, up 14 per cent from 28.6 million euros in the year-ago period. For FY2015, its revenues were
at 122.1 million euros. (AGENCIES)
Appendix 4:-
Page 38
Global Fashion Group (GFG), the parent company of the loss-making online retailer Jabong, has
secured funding of 300 million euros from Rocket Internet and Investment AB Kinnevik, according
to a press release from the company.
How much of this infusion is into Jabong was not immediately known. Jabong reported an operat-
ing loss of Rs 426 crore in FY15, slightly lower than in FY14. The revenue growth in FY15 inched
up by just 7% to Rs 866 crore from R811 crore in the previous year.
The fashion portal according to media reports, has been unable to find buyer even at valuation of
$100 million.
In 2014, Amazon reportedly wanted to acquire Jabong but the price tag was a steep $1.2 billion.
The funding comes at a time when the company is transforming itself into a marketplace from being
inventory-led player in a bid to cut costs.
According to a report by Rocket Internet, Jabong is the only loss-making outfit in GFG’s portfolio
of ten companies in the January-June 2015 period. Jabong also registered slowest revenue growth of
26.5% y-o-y in the six months to June, 2015 among the ten companies.
In December, former Benetton India MD Mohanty took charge of the company when Jabong’s
founder Praveen Sinha and Arun Chandra Mohan exited the company.
In February, former eBay India head Muralikrishnan B joined as chief operating officer while
Saurabh Srivastava, chief marketing officer stepped down from the position just five months into
his appointment.
Sanjeev Mohanty, MD and CEO, Jabong said the funding will help the firm enhance its business
operations. Recently, Rocket Internet sold its online furniture company FabFurnish to Kishore
Biyani’s Future Retail, at a valution of Rs11 crore. Foodpanda, food ordering and delivery platform
backed by Rocket Internet is also believed to be on the block, according to media reports.
Page 39
Appendix 5:-
The acquisition of Jabong further strengthens Flipkart Group’s position as the undisputed leader in
Fashion and Lifestyle segment in India.
As you are aware, Jabong is among India’s major fashion multi-brand e-store with more than 1500
on-trend international high-street brands, sports labels, Indian ethnic and designer labels and over
150,000 styles from over a thousand sellers. Myntra and Jabong are all set to define the next genera-
tion of online shopping offering the best of brands to Indian consumers.Some of the most iconic
global brands that will be exclusive to both the platforms include Dorothy Perkins, Topshop, Tom
Tailor, G Raw Star, Bugatti Shoes, The North Face, Forever 21, Swarovski, Timberland and La-
coste.
Fashion and lifestyle is one of the biggest drivers of ecommerce growth in India. We have always
believed in the fashion and lifestyle segment and Myntra’s strong performance has reinforced this
faith. This acquisition is a continuation of the group’s journey to transform commerce in India.
Page 40

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1

BUSINESS AND MANAGEMENT

Word Count :- 3835

“Will the recent acquisition of Jabong by Myntra provide Flipkart a growth

advantage in the competitive online fashion segment of India?”

Flipkart became one of the top e-commerce website today in India.

growth advantage in the competitive online fashion segment of India.”

and marketing theories that were appropriate for the case.

gression in this essay.

1) Introduction/ Rationale: ……………………………………………………………………… 6

1.1) Flipkart: …………………………………………………………………………………. 6

1.2) Company Background: ……………………………………………………………. 6

1.3) Case Definition : ……………………………………………………………………. 6

1.4) Problem background: ………………………………………………………………. 8

1.5) Research Question: …………………………………………………………………. 8

2.1) Primary Research: ……………………………………………………………………8

2.2) Secondary Research: ………………………………………………………………….9

2.3) Objectives: .…………………………………………………………………………….9

2.4) Syllabus area covered: …………………………………………………………………9

3) Findings and analysis ……………………………………………………….………………… 10

3.1) Analysis of survey results: …………………………………………………………. 10

4) Analysis of growth advantage for Flipkart through secondary research: ……………….. 13

4.1) Revenue growth………………………………………………………………………14

5) Growth diversity for fashion in Indian market: …………………………………………… 15

6) Analysis of Jabong: ………………………………………………………………………….. 16

6.1) Pre-Acquisition status: ……………………………………………………………… 16

6.2) Post- acquisition status: ……………………………………………………………. 16

7) Jabong SWOT post acquisition: ……………………………………………………………. 17

8) Porter’s five field analysis: ………………………………………………………………….. 19

9) Boston matrix and analysis: ………………………………………………………………… 20

10) Ansoff matrix analysis: ……………………………………………………………………. 21

11) Perception Mapping:……………………………………………………………………….. 22

12) Conclusion: …………………………………………………………………………………. 23

13) Bibliography: ………………………………………………………………………………. 26

14) Appendices: …………………………………………………………………………………. 28

acquisition of Jabong by Myntra.

1.2) Company Background:

2 “ To boost e-commerce segment, Myntra acquires Jabong”. 26 July 2016,

tions like Manish, Neeru’s etc.

1.3) Case Defination:

taken by Myntra to become India’s largest E-commerce Fashion plat-

5 “Style up: the Myntra Way - KnowStartup.” KnowStartup, 6 Aug. 2015,

tage of the acquisition.

1.5) Research question:-

“Will the recent acquisition of Jabong by Myntra provide Flipkart a growth

advantage in the competitive online fashion segment of India?”

2.1) Primary research:-8

7 “Making sense of Myntra's acquisition of Jabong”. Exchange for media.com, 27July2016.

threats and opportunities of the deal.

- Analysing growth advantage for Flipkart after the acquisition.

understanding of the strategies that could lead to success of the deal.

2.4) Syllabus area covered:-

- Porter’s five force field analysis 10

3.1) Survey Analysis

Graph 1-Result of the question- How often do you purchase online?

like Jabong to extend their market share.

commerce and industry.

connect with their customers.

14 Refer it to Appendix 1 (questionnaire to online shoppers)

15 Refer to appendix 1 (questionnaire to online shoppers)

market place in India than Myntra.

Amazon to face this.

entire online fashion industry most importantly the customers.

second most important factor17 is service and delivery.