By Group 3 :-10PT19 - Mahesh Jain10PT14 - Farhan Ahmed10PT23 - Meenakshi Gupta10PT30 - Pankaj Gupta
Introduction• Online Retail Industry• It is one of the leading e-commerce players in the country• With over 11.5 million book titles listed, 11 different categories, more than 2 millionregistered users and sale of 30000 items a day.• Founded by Sachin bansal & Binny bansal in Bangalore, Karnataka in 2007.• Started with initial capital of INR 4 lakh.• 7 warehouses, offices and delivery centers (2011).• Revenue is of 75 Crore (FY 2010-11).• 4600+ employees till December 2011.• Subsidiaries are “We Read”, “Mime 360” and “Lets Buy”.
Management Team Sachin spent his early years in Chandigarh. He graduated from IIT-Delhi with a degree in Computer Engineering. In 2006 he joined Amazon.com in India which he later left to set-up Flipkart. As CEO, Sachin oversees all the customer facing activities of the company ranging from technology to marketing. He is also in charge of Flipkarts corporate divisions which include the finance and legal departments. An avid gaming enthusiast, Sachin likes to spend most of his free time with his family. Sachin Bansal CEO and Co-founder Born and raised in Chandigarh, Binny went on to get a degree in Computer Engineering from IIT Delhi. He had a brief stint at Amazon before taking the entrepreneurial plunge with Flipkart.At Flipkart, Binny oversees all operational activities that come into play from the time the customer places an order till the time of delivery. This spans across divisions like warehousing, logistics and customer support.Binny is also passionate about soccer and NBA. An active sportsman, he used to captain his school basketball and soccer teams. Binny Bansal COO and Co-founder
Management Team Mekin completed his B.E. from PESIT Bangalore in 2002. He started his career with Yahoo! and then went on to join Ugenie where he created weRead, a successful social network around books. At Flipkart, Mekin is responsible for overseeing the company’s technological operations. These include innovation and application of technology in areas starting from supply chain to website management. Mekin is an avid sports fan and was actively involved in badminton, table tennis and cricket during his school and college days. Mekin Maheswari President, Technology Sujeet completed his engineering from IIT Delhi. He worked in the KPO industry and orchestrated several freelance projects before joining Flipkart in 2008.At Flipkart he is responsible for overseeing supply-chain, warehousing and logistics. He is also in charge of business development for all categories. Sujeet loves playing bridge and poker. Sujeet Kumar President, Operations
Company History•Flipkart was established in 2007 by Sachin Bansal and Binny Bansal, both alumniof the Indian Institute of Technology Delhi.•They worked for Amazon.com before quitting and founding their own company.•Initially they used word of mouth marketing to popularize their company.•A few months later, the company sold its first book on flipkart.com - John WoodsLeaving Microsoft to Change the World.•Today, as per Alexa traffic rankings, Flipkart is among the top 30 Indian web sitesand has been credited with being Indias largest online bookseller with over 11million titles on offer.•Flipkart broke even in March 2010 and claims to have had at least 100% growthevery quarter since its founding.•The store started with selling books and in 2010 branched out to selling CDs,DVDs, mobile phones & accessories, cameras, computers, computer accessoriesand peripherals, pens & office supplies, other electronic items such as homeappliances, kitchen appliances, personal care gadgets, health care products etc.•As of today, Flipkart employs over 4672 people.
Funding• Initially funded by the Bansals themselves with 4 Lakhs(INR).• Flipkart has since then raised two rounds of funding from venturecapital funds Accel India (in 2009) and Tiger Global Management (upto the tune of US$10 million) (in 2010).• Private equity firms Carlyle and General Atlantic are in talks to jointlyinvest about $150 million to $200 million in Flipkart, according tosources.
Acquisitions2010: WEREAD, a social book discovery tool.The stated goal was to giveFlipkart a social recommendation platform for buyers to make informeddecisions based on recommendations from people within their socialnetwork.2011: Mime360, a digital content platform company.2011: Chakpak.com is a Bollywood news site that offersupdates, news, photos and videos. Flipkart acquired the rights toChakpak’s digital catalogue which includes 40,000 filmographies, 10,000movies and close to 50,000 ratings. Flipkart has categorically said that itwill not be involved with the original site and will not use the brandname.2012: Letsbuy.com is Indias second largest e-retailer in electronics.Flipkart has bought the company for an estimated US$ 25 million.
Research Questions• How did Flipkart get on to the top of India’s e-shopping market in just 4years?• What were the strategies implemented by Flipkart to create onlinebusiness in India?• There are millions of retail websites and not many have achieved even afraction of the attention that Flipkart has. What is it that makes Flipkartstandout?• What does Flipkart have that makes its model so Robust?• What is there strategy behind acquisition of lets buy.• What is there future road map?• What are the major threats for Flipkart?
Order Lifecycle• Attract users to the site Family, Friends, SEO, SEM,WoM, Brand Building• Provide selection Make it easy to Find & Discover products• Provide details to evaluate a product Description, Specifications, UGC. • Price well Have to be competitive to the most obvious options • Provide convenient payment options Online, COD • Confirm payment
Order Lifecycle (Cont…) Get the item Procure from Supplier (Just-in-time) (Supplier selection) Keep Inventory (Inventory Prediction, Planning) Clean & Check for sanity Pages missing, MRP printed lesser than told to you Pack the item Tamper proof, weather proof, breakage proof Select courier & hand-over Courier performances vary across regions a LOT Get tracking id & communicate to customer Follow-up for timely delivery Take care of returns (faulty product/user changes their mind) Minimize returns
Why they acquired lets buy• They will be far ahead in the game, by the time Amazon make a fullfledge entry with their own brand retail products in India.• It will make Flipkart stronger in the field of E-retailing.• This acquisition fits in to their strategy of building dominant sharesin all the categories they operate in.• The price they paid for this opportunity was very attractive.• This will now, allow them to accelerate faster and to get to a sharesimilar to what they enjoy in online books category.• This will strengthen the position of Flipkart in Indian market in lightof the quiet entry of Amazon in Indian e-commerce industry throughjungle.com.
What Went Right for Flipkart!• The first and foremost was that we Indians were discarding our stone-age ways and beginning to shop online.• Another thing the two entrepreneurs, Sachin and Binny Bansal, didright was that they started off with books – a low capital investment and afast turn-around time.• But the best thing they did was that they understood that too besuccessful in India, you need to be the God of Distribution.• In India, it’s amazing Logistics that prove to be the game-changer andthat’s exactly what the folks at Flipkart have done.
Challenges Faced By Flipkart• Initially when they started out, it wasn’t easy for us to earn the trust of thecustomer.• Handling customer complaints, without having a ‘face’ to our customer serviceproves to be bit of a challenge at times.• Not having the ‘display’ advantage, the ‘browsing’ feature and not being ableto carry out promotional activities are some other obvious challenges.• The discomfort of paying by cards, on account of security fears is anotherchallenge. They have now tried to address that by introducing the ‘cash-on-delivery’ option.• The fact that highest number of orders and sales get registered duringweekends proves to be tough at times for logistics and customer service.• The fact that we have to work 24 / 7 and the customer perceptions around italso bring some difficulty (For example, the customer places an order at 12 amand counts the number of hours for delivery right from then!)
What makes it stand out?• The procurement model is at the heart of Flipkart’s success, asmost delays or troubles occur in this part of business.• Flipkart employed consignment model i.e. procurement based ondemand.• It is the robust logistics at Flipkart that sets it apart from otherwannabe e-commerce sites.• An amazingly well-oiled warehousing and delivery system..• They offer a huge range of titles (more than 7 million) which reallysets them apart from the rest of the crowd.
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) andGoogle Ad-words as the marketing tools to have a far reach in the onlineworld.• Flipkart.com official Face book page has close to 9 lac likes. Flipkartrecently launched a series of 3 ads with the tag line - "No Kidding Noworries"• Kids were used to create the adverts to send out the message - if a kidcan do it, you can also do it.• All in all to create a great customer experience.
Flipkart’s Success mantra!• Great customer serviceFlipkart users are more satisfied than that of their competitors. Greatcustomer service has been its hallmark.• Easy to use website, hassle free payment systemThe user interface is sleek and easy to use.• Cash on delivery/Card on delivery mode of paymentThis has been a major instrument in Flipkart’s success. Almost 60% of itssales happen through this mode. Cash on delivery created trust in theminds of Indian customers who were always weary of making paymentsonline.• Focused on user experienceEvery other e-commerce site, tried to cram the maximum of amount ofinformation possible into every single page where as Flipkart focused onproviding only the relevant info.
Prepaid Wallet featureFlipkart has added a prepaid Wallet feature to its e-commerce platformthat allows shoppers to store money on the site and use it to purchaseitems, without having to reach for their credit card for each transaction.
Startups Hiring? Do it the Flipkart way!Hiring or rather right hiring is one of the critical factors contributing to astartup’s success, So some of the key criteria that the Flipkart team looksat while hiring are :• They typically don’t look at specialists to come on board rather theylook out for generalists with the attitude to learn and adapt to thefast pace of growth .• “Everyone in the team on a collective and individual level needs to havea high sense of ownership. This is something which clearlydifferentiates a high performing organization from the others.• Your hiring process is the best brand campaign for you –“Transparency in hiring is one of the best ways to attract the right kind oftalent
Threats to its Crown• There are no major foreseeable threats in the future.• The company has built a great brand name, they just have tomaintain and enhance the same.• Need to keep introducing more products, adapting to the changingneeds of the customer with time.• The entry of Amazon.com in 2012 in the Indian e-commerce spacehas been cited as a big challenge to Flipkart.• However i think that Flipkart is a respected Brand name in India andshould be able to compete with Amazon.• Remember Amazon being a very big company can bring in seriouscompetition to Flipkart, since Amazon can bear more losses in thebeginning to gain customer base.
Threats to its Crown(Cont..)• But again Indian market is growing at a rapid pace as access tointernet increases and people become more aware of e-commerce sitesand start trusting the same.• Hence Indian market is sufficiently big at-least for these two giants toco-exist beneficially.
Future Road Map• They aim at 10 times growth, and eyes at $ 1Billion sales by 2015.•They will look at bigger investments in their supply chain andtechnology.• Investment will be made in large warehouses and increasedautomation of their process, so that the product is not delayed.• They intend to enter in to various new categories and expand theircurrent categories as well.• Everything except for groceries and automobiles will be available onFlipkart in future.• To go further in the value chain, Flipkart is looking at associationswith a larger number of suppliers and partners, both nationally andinternationally.
Conclusion• Flipkart, the first billion dollar Internet company from India(going by 2015estimates )is by far the leading online store in the nation.• Now that Amazon is reportedly entering India in early 2012, this newsbecomes even more significant, considering that Amazon haspreviously, and unsuccessfully, tried acquiring the company, with Flipkartdemanding a very high buyout price.• With online retail industry in India pegged to reach $1.5 billion(2015), sources suggest that e-commerce is just hotting up in India and wemay soon seen many more Internet companies achieving similar success