The document provides an overview of the Indian e-commerce industry and key players such as Flipkart. It discusses the growth of e-commerce in India, challenges faced, and analyses companies like Flipkart in terms of their business models, operations, marketing strategies, and future prospects. SWOT analyses are also presented for Flipkart and the e-commerce industry in India.

1. INDIAN E-COMMERCE INDUSTRY
Swayam D. Faiz A. Reetu Y. Lavish S. Prakash s.

2. INTRODUCTION
 E-Commerce stands for Electronic Commerce
 Pertains to trading in goods and services through the electronic medium
 It is all about speed, connectivity, and sharing and exchanging goods,
services and information Javalgi
and Ramsey (2001)
 Ecommerce is the use of the internet “for exchanging information of value
between firms and their trading partners, employees, and customers with
the absence of geographical and time restrictions”
Barnes-Vieyra
and Claycomb (2001,p.13)

3. SCOPE
 India is showing tremendous growth in the Ecommerce
 With the middle class of 300 Million people, online shopping shows
unlimited potential in India

5. GROWTH

6. E-COMMERCE IN INDIA
 Various Websites providing variety of goods and services such
Flipkart, Home Shop 18, MakeMyTrip, Bigbasket, Bagskart etc.
 There are total 1938 e-commerce companies in India(Oct, 2012)
 Domestic e-commerce market has the potential to grow between
$ 125 Billion and $ 260 Billion by 2024-25
 In India E-commerce is facilitated by Information Directories and
Banks (Net Banking, Phone Banking, Credit Card, Debit Card)
 Most difficult challenge for Indian e-commerce industry is : We
still belief of touch and feel concept.
 People are not comfortable with online money transaction

7. SWOT ANALYSIS
STRENGHTS
 Niche product selling
 Low barrier and overhead cost
 Direct customer communication
WEAKNESS
 High customer expectations
 Search engine unpredictability
 Govt. rules and regulations
 Indian's are still believe in touch and buy concept
 Active internet users are very low in number

8. OPPORTUNITIES
 Global exposure
 24/7 business
 Increasing network across the companies
 FDI in ecommerce has stopped, so Indian players have a
good opportunities
THREATS
 Direct selling of the brick and mortar shops are increasing
 Chance of hacking: security issues
 Future legislations
 Less scope of innovation

9. INTRODUCTION TO FLIPKART
 Flipkart is an Indian e-commerce company headquartered in
Bangalore, Karnataka
 Founded by Sachin Bansal and Binny Bansal in 2007
 Started with 4Lacs
 Then added two venture capital in 2009(Accel India) and 2010(Tiger
Global Management)
 Flipkart focused on online sales of books but it later expanded to
electronic goods and a variety of other products

10. A BRIEF HISTORY OF FLIPKART GROWTH
Source: Flipkart Blog

11. Source: Flipkart Blog

13.  Source: Flipkart Blog

14. FLIPKART FUNDING
Venture capital Private Equity
Flipkart

15. OVERVIEW
 Bansals controls about 37% of flipkart equity,while Accel partners and
Tiger Global controls 48%.
 Management holds remaining 15%.
 Total Revenue of the company Rs 500 crore in 2011-2012.
 As per the previous year Rs 50 crore in 2010-11.
 Largest online Book retailer in India with 80% market share.
 Two million customer base and total daily sales of Rs 2.5 crore.

16. WHY FLIPKART IS LOSING MONEY?
 MRP of Strategy Books Rs 499.
 Estimated cost at which flipkart gets it from Publisher Rs 299 (Assuming 40% Margin
)
 Cost of delivering it to a customer outside of eight cities Rs 344 ( Assuming Rs 45
for delivery cost)
 Charge levied by logistics partners Rs 379( Assuming Rs 35 on order size)
 Price at which sold to consumer :Rs 324.
REMEDY OF THE PROBLEM
 Increase the price of the books
 Changing Consumption pattern: Increasing the ticket size
 In future their logistics will increase. Hence costs related to delivery will be reduced.

17. WHAT IS RIGHT WITH FLIPKART?
 Understanding Customer psychology
 Gaining Trust
 Expanding the market
 Diverse Product Categories
 Good use of SEO
 Good use of Social Media Optimization
 Outstanding delivery
 Introduction of new technologies in regular intervals.

18. OPERATIONS OF FLIPKART
 Flip kart’s core competency lies in their Supply chain and logistics
Process of Supply Chain
1. Building the Supplier Base
2. Building Infrastructure for Operations
3. Use of Information system
Technological Overview
 Round the clock operations.
 Technology plays a critical role. Flipkart often refer to themselves as a
technology company doing e-commerce
 They use Linux as their implementation technology for resource
management, task management and file management
 Flipkart works with popular open source products such as Ubuntu, Mysql,
Apache

19. MARKETING OF FLIPKART
 Word of mouth (initial marketing even now they want to satisfy customer so they
come back for more)
 Good use of SEO
 “We DONOT 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”
 Good use of SEM
 Ads at proper places and use pay per click to pay for ads

20. STP
 SEGMENTATION
1. All internet users and shoppers
 TARGET
1. Flipkart concentrates on more Psychographic, which helps in deciding
where to display ads online
2. They target online shoppers and people who don’t online shop (thus
TVC to encourage them)
 POSITIONING
1. Customer delight (low price, free shipping, replacement)
2. No kidding no worries
3. Online megastore
4. One stop solution

21. 7 P’S OF FLIPKART
Product:
 Appearance –the ease in the website interface even for the first visitor
 Quality –checking of the product before packing (visual test)
 Packing –different packing(eg. Bubble pack for electronic items)
 Brands–all brands integrated in one website
 Warranty -one year warranty from the manufacturer’s side
 Service & support–guarantee delivery of undamaged product or else
replacement in 30 days

22. Price:
 Special discount
 As shipping is within India the shipping cost reduces
 Seasonal discounts
 Free shipping
 For expensive products transit cost is borne by company
Place:
 Tie ups with local vendors and courier firms (thereby
avoiding octroi charges)
 Company owned warehouse in major cities near airport
 If the courier can’t delivery to the location the product is
shipped through government post

23. Promotion:
 SEO and SEM
 Word of mouth marketing
 TVC lately to encourage non-online shoppers
 More online marketing like FB, Twitter, linkedin
Physical Evidence:
 Different packaging for different product to ensure safe delivery
 Flipkart the name goes with the online cart
 Design and packaging is common so customers can relate it to the
company
People:
 Service people, Sales Clerks, Delivery drivers, Managers, Complaints
department, Accounting, Warranty people, Technical people, all work for
the customer ease, customer satisfaction and customer delight.

24. SWOT ANALYSIS OF FLIPKART
Strengths
 Top Indian ecommerce portal
 Diversified into electronic goods
 Two VC investment to build its own delivery system thereby
reduce delivery time
 Cash on delivery which is making 60% of its income
Weakness
 Coordination with suppliers and courier was tough
 Price biasing to maintain the margins ( eg. Low price for the best
seller book and more price for the least wanted)

25. Opportunities
 Already working towards customer delight will obtain
customer loyalty gradually
 Supplier database interface with Flipkart website for JIT
procurement
 Mobile internet usage is increasing there by chances of
increase in sales through mobile shopping.
Threats
 Small players and emerging competitor
 Major players like Amazon
 In capabilities to manage certain costs like delivery cost,
bank charges.

26. FLIPKART ‘S NEW TRIANGLE: RAISING THE BAR
Key Success factors:
• brand loyalty
Competencies:
• User experience • large self owned delivery channels
• Reliability • supplier network/ first to market
• convenience • mobile shopping solution/ increased
• delivery reach reach
• delivery time • innovation in
• mobile shopping services/payments/technology
• availability • excellent customer services
• product modes (printed/ e-books)
• internet strategy (search engine
• titles
Threshold factors: Brand awareness, price.
optimization, platform advancement)
• large loyal customer base.
Value proposition:
“Completely hassle free shopping experience with
best services to everyone, everywhere and every
time in India”.

27. PEST ANALYSIS FRAMEWORK

28. FUTURE PLANS OF FLIPKART
 By 2013-14, Flipkart plans to:-
• Offer new categories on its website
• Increase its footprint of warehouses
• Expand operations into new cities(Tier 3)
• Increase staff size from 2000 to over 10,000
• Grow revenues 10 to 30 times over

29. FUTURE PROSPECTS OF FLIPKART IN INDIA:-
 Marketing is very important and it is generally believed that
online people are easier to target.
 The savings in marketing costs can be passed on and prices
can be reduced.
 Hence in future that helps Flipkart in reducing prices.
 FDI will help in improving the efficiency of supply chain.
 FDI will also help in boosting the confidence levels of the
customers in which foreign player will play an important role.
 Hence in future by spending time on online by purchasing
clothes and electronics goods will help Flipkart increase in
future rapidly.

30. CHALLENGES
 High inflator trend in the global and domestic economies
 As capital expenses are being deferred because of huge increase of
cost of capital
 Then there is much pressure on existing asset to deliver operational
performance
 Government policies in most developed and developing countries
have imposed very stringent norm for safety.

31. TRENDS AND OUTLOOK OF E-COMMERCE INDUSTRY
IN INDIA
 Overall growth of Consumer & Supply side interest in e-
Commerce in India - Brands & Manufacturers getting online
 Increase traction of Lifestyle categories and Women shoppers
online
 Role of Social Media marketing in driving e-Commerce growth
 Potential from Tier 3 towns
 Impact of growth in Smart phones on e-Commerce
 Negative impact of rampant price cutting and couponing in the
industry - how will players make money ?

32. Flipkart eBay Jabong Homeshop 18 Myntra
Available Not Available Available Not Available
Books
Mobiles &
Available Not Available Available Not Available
Accessories
Computers Available Not Available Available Not Available
Available Not Available Available Not Available
Cameras

33. Gaming Available Not Available Not Available Not Available
Music, Movies &
Posters Available Not Available Not Available Not Available
TV, Video & Audio
Available Not Available Available Not Available
Home & Kitchen
Available Available Available Not Available

34. Pens &
Stationary 
Not Available Not Available Not Available Not Available
Belts, Bags &
Luggage Available Available Available Available
Watches Available Available Available Available
Beauty & Health
Available Available Available Available
Care
Baby Care Available Available Available Not Available

35. Toys Available Available Available Not Available
Not Car & Bikes
Available Not Available Not Available Not Available
Not Footwear & Available Available Available
Available Clothing

36. EBAY BUSINESS MODEL
eBay
Marketing Business
Person Developers
Buyers Sellers
In this type of Model any body can buy or sell

37. THE PERCENTAGE BREAKDOWN BETWEEN EBAY'S DIFFERENT
EXPENSE GROUPS
Chart Title
Other Sales and
16% Marketing
General 40%
Administration
24%
Product
Development
20%

38. FLIPKART BUSINESS MODEL
WHEN COMPANY ORDER THE GOODS FROM VENDORS
Vendors Flipkart Customers
Agents

39. CONT…
WHEN COMPANY HAS THEIR OWN WAREHOUSE
Warehouse Flipkart Customers
Agents

40. JABONG BUSINESS MODEL
Customers
Vendors Jabong
Agents

41. HOME SHOP 18 BUSINESS MODEL
Vendors
Channel
Partners
Customers

42. Online Service Quality for Luxury Purchases
Good customer service 4.55
Money-back guarantee 4.48
Easy return or exchange of merchandise 4.46
Control over use of personal data 4.43
Site reliability 4.42
Ease of use 4.33
Wide product selection 3.99
Fast site 3.97
Information related to products/services sold 3.93
Wide range of shipping/delivery options 3.88
Brand name 3.65
Site personalization 3.55
Physical presence 3.49
Discounts or coupons 3.24
Personalized product recommendations 3.12
Recommendations to complement previous purchases 2.95
Source: Forrester Research Inc., 2001

43. COMPARATIVE PERFORMANCE ANALYSIS :
Key Success
Factors Weight Flipkart Mynta HS18 Jabong Ebay
Brand Awareness 0.15 1 0.8 0.7 0.75 0.9
Delivery Time 0.1 1 0.8 0.6 0.7 0.7
Delivery Reach 0.1 0.9 0.8 0.7 0.75 0.8
User Experience 0.15 0.85 0.9 0.8 0.8 0.7
Reliability 0.15 0.9 0.8 0.7 0.7 0.7
Availability 0.1 0.85 0.7 0.7 0.7 0.9
Price 0.15 0.75 0.8 0.7 0.8 0.7
website design 0.1 0.7 0.75 0.65 0.7 0.6
Total Weighted
Score 1 0.87 6.35 5.55 5.9 6
Total Market
Share(%) 100 37 12 3 4 4
Purely based on assumption and market understanding

44. REFERENCES
 [1] Sinha (April 2009), “Ecommerce in India – The Real Challenges”
 [2] Chaudhury, Abijit; Jean-Pierre Kuilboer (2002). EBusiness and e-
Commerce Infrastructure. McGraw-Hill.
 [3] Frieden, Jonathan D.; Roche, Sean Patrick (2006), "Ecommerce:
Legal Issues of the Online Retailer in Virginia", Richmond Journal of
Law & Technology
 [4] Miller, Roger (2002), “The Legal and E-Commerce Environment
Today”, Thomson Learning
 [5] Turban E, Lee J King D and Chung H M (1999),”Electronic
Commerce: A Managerial Perspective”, Prentice Hall
 [6] Ubois, Jeff (1995), “Wheels of Commerce- an Interview with
commerce”, pp 62-69
 [7] Megna, Michelle (2008); “E-Commerce Trends for 2008 and 2009”.
 [8] Rastogi, Rajiv; “Country’s report on E Commerce Initiatives”.
 [9] Internet World Stats

45. CONT…
 [10] Overview of E-commerce in India
 [11] 20 Hot E-commerce startups in India
 [12] Indian e-commerce at inflection point?
 [13] India broadband penetration growth
 [14] E-commerce growth with 3G Models of e-commerce in India
 [15] India B2C E-commerce Market Size
 [16] Consumer E-commerce in India
 [17] “Asia Pacific Online Retail Forecast, 2011 To 2016,” Forrester
Research Inc. Zia Daniell Wigder, with Steven Noble, Vikram Sehgal and
Lily Varon.
 [18] Indian Retail Market Size and Growth Estimates
 [19] Written by Piper (2012-08-10). "Name the India’s Largest Ecommerce
Company". Ecommerceforum.in. Retrieved 2012-08-14.

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