Marketing Strategy Of Flipkart Final Proj 4162a

Marketing Strategy of Flipkart

CHAPTER 1 1.1 1.2

INTRODUCTION HISTORY OF MARKETING STRATEGY OF

1.3 1.4 1.5 1.6 1.7 1.8 1.9

FLIPKART FUNCTION MERITS AND DEMERITS SWOT ANALYSIS OF FLIPKART FLIPKART MARKET OVERVIEW MARKET SEGMENTATION MARKET POSITIONING MAJOR COMPETITORS

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Marketing Strategy of Flipkart

1.1 INTRODUCTION 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 ecommerce websites, but there were hardly any such sites in India and they decided to give birth to their own e-commerce venture - Flipkart.com Thus was born Flipkart in Oct 2007 with an initial investment of 4 lac (co-founders savings). It was never going to be easy since India has 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 Page 2

Marketing Strategy of Flipkart (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 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 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 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, Page 3

Marketing Strategy of Flipkart 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 s today where as the number of homes with Cable and Satellite (C&S) television is 10.5 crore. The expected internet s 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 ecommerce, 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 s at the moment, the number is expected to swell to 22.5 crore by 2014. Interesting Statistics about the company As of today, Flipkart employs over 4500 people. It experiences 2 million unit sales and 4 million unique visitors per month with sales growing at 25% per month, eyeing a $50 million run rate. With close to 11.5 million titles, Flipkart is the largest online book retailer in India with 80 per cent market share. It has a ed base of two million customers and ships out as many as 30,000 items a day, clocking daily sales of Rs 2.5 crore. Flipkart is rapidly expanding its network of warehouses, distribution centers, procurement operations and 24/7 customer teams. The company even has its own delivery network in 27 cities and is set to expand this even further by next year. Page 4

Marketing Strategy of Flipkart

1.2: HISTORY OF FLIPKART

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Marketing Strategy of Flipkart

Back in 2007, when Flipkart was launched, Indian e-commerce industry was taking its beginner steps. The company is ed in Singapore, but theyir headquarters are in the city of Bangalore, India.

 Founders Page 6

Marketing Strategy of Flipkart

Sachin Bansal and Binny Bansal , who were working for Amazon.com had an idea to start an e-commerce company in India. Both of them are alumni of IIT, Delhi and are native of Chandigarh, India. They left their jobs in Amazon to start their own business.One can easily call that a risky move. In a country where people have various tastes and preferences, an ecommerce start-up will always have enormous challenges. In India, people often prefer to shop in person and buy goods they see and like. Today, thanks to Flipkart, e-commerce has become one of the fastest growing sectors in India.

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Marketing Strategy of Flipkart

 HOW IT STARTED

Flipkart began selling books to begin with. It soon expanded and began offering a wide variety of goods. Innovating right from the start, Flipkart has been home to few of the striking features of Indian e-commerce.

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Marketing Strategy of Flipkart

  Fundings History

In the first few years of its existence, Flipkart raised funds through venture capital funding. As the company grew in stature, more funding arrived. Flipkart Page 9

Marketing Strategy of Flipkart repaid the investors’ faith with terrific performances year after year. 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.Their last round of Fundraising had increased their value to $ 15 billion, however, as of February 2016, according to Morgan Stanley, their estimated value stands at $11 billion.

 Evolution

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Marketing Strategy of Flipkart 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. Flipkart was the first to implement the popular ‘Cash On Delivery’ facility, which every online shopping website in India offers as an option today.

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

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Marketing Strategy of Flipkart management system to deliver orders in a timely fashion.Today as it stands, Sachin Bansal is the Chairman of the company and Binny Bansal is the CEO of Flipkart.

 Acquisitions

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Marketing Strategy of Flipkart Flipkart also acquired few companies like Myntra.com, LetsBuy.com etc., to better their presence in the market. With the entry of Amazon.com in India, the competition between the companies has seen many takeovers. Flipkart’s journey from a small book e-retailer to India’s largest e-commerce 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. Flipkart’s story proves that if you have a great idea, and you are a doer and not a thinker, success is not far off.

1.3 FUNCTION OF FLIPKART

Almost every urban and tech-savvy Indian is familiar with the fairy tale of Flipkart, how the two founders started with absolutely no inventory but would go out and source the book before delivering it and the enormous funding that they went on to raise on the path

to

hitting

the

$1

billion

GMV

target

earlier

this

year.

The e-commerce side of the story is what is well known and publicized in the popular media. But Flipkart has been working quietly to diversify into allied businesses and supplement

the

revenue

and

boost

their

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bottom

line

in

the

process.

Marketing Strategy of Flipkart Flipkart currently has 6 different entities with various names as per publicly available information. The function of each entity and the product / service owned within is unclear.

WS Retail Services Pvt Ltd Although WS Retail was incorporated in 2009, most of the products being sold on Flipkart till 2013 were from the inventory owned by Flipkart. As seen in an earlier post, this was at a time when the FEMA policies on e-commerce and multi-brand retail were unclear. As the rules became clear that e-commerce and multi-brand retail entities could not have FDI, WS Retail was sold off to a group of HNIs led by Rajiv Kuchhal in 2013, with a board comprising of unknown individuals rumoured to be relatives of the Flipkart founders

(unconfirmed).

If true, this makes it a notional separation with WS Retail working closely with Flipkart, although

they

are

two

different

legal

entities.

Currently, Flipkart is operating in the marketplace model where any seller can put up their products and pay a commission to Flipkart. However, it is to be noted that a vast majority of products available are owned by WS Retail, making it one of the largest sellers by far.

PayZippy (Flipkart Payment Gateway Services Pvt Ltd) This company was incorporated in 2011 with the board comprising of Amod Malviya and others. Amod is currently the CTO of Flipkart and was earlier the Head of Engineering. He has prior experience of financial transactions in ApnaPaisa.com. PayZippy Merchant services (payment gateway) was launched in July 2013 with the Page 14

Marketing Strategy of Flipkart claimed intention of tackling the existing problems of low transaction success rates, slow refunds and lack of transparency. PayZippy Consumer services was launched in December 2013 – it is essentially a prepaid wallet where credit card details will be saved and a simple two factor authentication can be used by consumers to make online payments

quickly

and

effectively.

Flipkart has tried to bring in incremental innovation in both services. For the merchant side, the product aims to increase the transaction success rate to enable merchants to have a better cash flow. In addition, the pricing system is comparable to other gateways, but does not have any annual fee that almost every other payment gateway has. For the consumer side, the feature is a variation on what Paypal is doing in other countries. They have managed to gain early buy-ins from websites such as MakeMyTrip, CaratLane and so forth. The target for consumer side was set at 1 million s by June 2014 although the current base is unknown.  EKart (Legal entity name unknown) Flipkart’s in-house delivery and logistics team was spun off under the brand name eKart, although there is no specific website and the legal entity that owns eKart is also not known. As this post goes live, all eKart delivered packages can only be tracked on the Flipkart website, and typically for the products owned by WS Retail. However, the service was offered to third party e-commerce websites from February this year, starting as a pilot with just a few unknown partners. eKart claims to have a reach of about 150 cities in India. Flipkart’s competitors too are expanding upstream and downstream. For example, DTDC has launched a specific e-commerce related delivery service called DotZot.

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Marketing Strategy of Flipkart Amazon and Snapdeal provide logistics services to the sellers selling on their platforms.

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Marketing Strategy of Flipkart

1.4 MERITS AND DEMERITS OF FLIPKART

Recently I have been hearing of multiple complaints about the quality of the products Flipkart is delivering and the way the customer care is behaving with the consumers. I shall write a review on that very soon. Meanwhile below are the merits and demerits of Flipkart.com I have observed in the last couple of years.

 Merits Of Flipkart Below are the advantages of Flipkart based on my personal experience and other reviews read on internet.

1. Flipkart is really India’s largest online mega store. They have huge number of products in multiple categories. I don’t think there is another Indian online portal where you can see such number categories of products. They have millions of books available even before launching with an option of pre-ordering.

2. Flipkart has tie ups with multiple courier services and hence can deliver most of the products to most of the areas in time. The delivery service is also professional. Cash on Delivery option is available with a 30 day replacement warranty.

3. They have wide range of blu-ray and 3D movies, Flyte music s, games available. Page 17

Marketing Strategy of Flipkart 4. Flipkart also launched Clothing, Sports Wear and Cosmetics range which are of the best brands in the market.

5. Flipkart offers good discounts on many of the products available which you hardly find on other websites.

6. Flipkart sells only good quality, branded and non-damaged products only 

Demerits of Flipkart

1. They deliver products only in India. No service available outside India even if you are willing to pay extra money. The service is not available for certain areas in India also. You can check availability by giving the place pin code in their site.

2. The service is not upto the mark in villages when compared to the urban areas. Sometimes

they

take

lot

of

time

to

deliver

products

in

rural

areas.

3. The minimum order for free home delivery is increased to 500/- recently while some other sites are doing it for lesser than that.

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Marketing Strategy of Flipkart

1.5 SWOT ANALYSIS OF FLIPKART   Strength: 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 potential

Investor‘s trust

Industry condition: very high

Services and warehousing

Payment options

Established brand

  Weakness:

Coordination with suppliers and courier was tough Price biasing to maintain the margins ( e.g. Low price for the best seller book and more price for the least wanted) 24/7 customer care, thus even mid night is to delivered within 24 hours Entry of international on-line competitors in Indian market Customers are not comfortable with online payment Not profitable operationally Time to build confidence among the customers Middle management retention issues.

   Opportunities: Page 19

Marketing Strategy of Flipkart

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 sby chances of increase in sales through mobile shopping.

Development of m-commerce in the e-market Increasing internet

penetration Target social medias to reach young population High interest among VC/PE.

  Threats:

Small players and emerging competitor In capabilities to manage certain costs like delivery cost, bank charges High competition from major international online retailers

Capture of alternative market by competitors

Amazon

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Major players like

Marketing Strategy of Flipkart

1.6 FLIPKART MARKET OVERVIEW

India has an internet base of about 250.2 million as of June 2014. The penetration of e-commerce is low compared to markets like the United States and the United Kingdom but is growing at a much faster rate with a large number of new entrants. The industry consensus is that growth is at an inflection point. Unique to India (and potentially to other developing countries), cash on delivery Page 21

Marketing Strategy of Flipkart is a preferred payment method. India has a vibrant cash economy as a result of which 80% of Indian e- commerce tends to be Cash on Delivery. However, COD may harm e-commerce business in India in the long run and there is a need to make a shift towards online payment mechanisms. Similarly, direct imports constitute a large component of online sales. Demand for international consumer products (including long-tail items) is growing much faster than in-country supply from authorized distributors and e-commerce offerings. India's e-commerce market was worth about $2.5 billion in 2009, it went up to $6.3 billion in 2011 and to $14 billion in 2012. About 75% of this is travel related (airline tickets, railway tickets, hotel bookings, online mobile recharge etc.). Online Retailing comprises about 12.5% ($300 Million as of 2009) India has close to 10 million online shoppers and is growing at an estimated 30% CAGR vis-à-vis a global growth rate of 8–10%. Electronics and Apparel are the biggest categories in of sales. Key drivers in Indian e-commerce are: Increasing broadband Internet (growing at 20% MoM) and 3G penetration.  Rising standards of living and a burgeoning, upwardly mobile middle class with high disposable incomes.  Availability of much wider product range (including long tail and Direct Imports) compared to what is available at brick and mortar retailers  Busy lifestyles, urban traffic congestion and lack of time for offline shopping  Lower prices compared to brick and mortar retail driven by disintermediation and reduced inventory and real estate costs Page 22

Marketing Strategy of Flipkart  Increased usage of online classified sites, with more consumer buying and selling second- hand goods  India's retail market is estimated at $470 billion in 2011 and is expected to grow to $675 billion by 2016 and $850 billion by 2020, – estimated CAGR of 7%. According to Forrester, the e- commerce market in India is set to grow the fastest within the Asia-Pacific Region at a CAGR of over 57% between 2012–16. As per "India Goes Digital", a report by Avendus Capital, a leading Indian Investment Bank specializing in digital media and technology sector, the Indian e-commerce market is estimated at Rs 28,500 Crore ($6.3 billion) for the year 2011. Online travel constitutes a sizable portion (87%) of this market today. Online travel market in India is expected to grow at a rate of 22% over the next 4 years and reach Rs 54,800 Crore ($12.2 billion) in size by 2015. Indian e-tailing industry is estimated at Rs 3,600 crore (US$800 mn) in 2011 and estimated to grow to Rs 53,000 Crore ($11.8 billion) in 2015. Overall e-commerce market is expected to reach Rs 1, 07,800 crores (US$24 billion) by the year 2015 with both online travel and e-tailing contributing equally. Another big segment in e- commerce is mobile/DTH recharge with nearly 1 million transactions daily by operator websites.

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Marketing Strategy of Flipkart

1.7 MARKET SEGMENTATION

The process of defining and subdividing a large homogenous market into clearly identifiable segments having similar needs, wants, or demand characteristics. Its objective is to design a marketing mix that precisely matches the expectations of customers in the targeted segment. Few companies are big enough to supply the needs of an entire market; most must breakdown the total demand into segments and choose those that the company is best equipped to handle. The four basic market segmentationstrategies are based on GEOGRAPHIC SEGMENTATION - CATERS TO TIER 1, TIER 2 AND TIER 3 CITIES.  DEMOGRAPHIC SEGMENTATION - 75% of online s between the age group of 15-34 years.  Flipkart targets mainly the youth of the country,  BEHAVIOURAL SEGMENTATION – Web friendly people.  PSYCHOGRAPHIC SEGMENTATION – Flipkart concentrates on more Psychographic, which helps in deciding where to display ads online  They target online shoppers and people who don‘t online shop (thus TVC to encourage them)

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Marketing Strategy of Flipkart

1.8 MARKET POSITIONING

An effort to influence consumer perception of a brand or product relative to the perception of competing brands or products. Its objective is to occupy a clear, unique, and advantageous position in the consumer's mind. Points of parity:  Easy locating of products • Competitive prices.  No hassles of going to shops personally and shop for products  Availability of various products on one platform  Discount on purchases.  Home delivery  Gifting services  Cash on delivery Page 25

Marketing Strategy of Flipkart  Availability of liquor  Flipifts  Academic related books Points of Difference:  Flipkart hip cards for customers  Vernacular language  Better interface-one drag approach

1.9 MAJOR COMPETITORS

Amazon.com is an American international electronic commerce company with headquarters in Seattle, Washington, United States. It is the world's largest internet company, based on revenue and number of employees. Snapdeal.com is an online Page 26

Marketing Strategy of Flipkart marketplace, headquartered in New Delhi, India. The company was started by Kunal Bahl and Rohit Bansal, in February 2010. eBay Inc., is an American multinational corporation and e-commerce company, providing consumer-to-consumer sales services via Internet. It is headquartered in San Jose, California, United States. HomeShop18 is an online and on-air retail and distribution venture of Network 18 Group, India. HomeShop18 was launched on 9 April 2008 as India's first 24-hour Home Shopping TV channel. Yebhi.com is an Indian Online shopping E-commerce portal for Home, Lifestyle & Fashion e- retailer, launched in the year 2009.

CHAPTER 2: OBJECCTIVES OF STUDY Page 27

Marketing Strategy of Flipkart

Objectives tell us why project has been taken under study. It helps us to know more about the topic that is being undertaken and helps us to explore future prospects of that organization. Basically it tells us what all have been studied while making the project.

To know the strategy adopted by Flipkart in this new era To understand Flipkart strategy and their competition To study how Flipkart is the leading shopping app in India To know what is difference between Flipkart shopping and other shopping site To know Whether common people are convenient by purchasing product from Flipkart

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Marketing Strategy of Flipkart

CHAPTER 3: RESEARCH METHODOLOGY 3.1 PRIMARY DATA ANALYSIS AND INTERPRETATIONS  I have taken survey of some people living in my society regarding the most leading online shopping website Flipkart which is shown with the help of graphs below. 1. How often do you purchase from Flipkart?  Most of male gender purchase from flipkart and female shop less from flipkart compared to male

2. How often do you purchase from Flipkart?  Most of people purchase when offer zone is going on and most of shopping is done foe electronics 3. How do come to know about Flipkart

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Marketing Strategy of Flipkart  People come to know about Flipkart by different means like most come to know by ment, Newspaper, Newspaper and Magazine,etc. 4. What category of products do you purchase from Flipkart?  Most of them purchase electronics because it is trustable Following is the my experience shared with shopping by Flipkart  First when I purchased from flipkart my experience was awesome with it  I bought the quality product  After that I always shop from Flipkart and recommend it to others also  As I have seen that offers on Flipkart comes with an best deals for us. Page 30

Marketing Strategy of Flipkart  As per my experience Flipkart is best for shopping and best customer service. 3.2 SECONDARY DATA o ments Used in Newspapers and Magazines: Newspaper advertising works on the fundamental of building trust and confidence with the readers. Newspapers have the greatest impact because of the following reasons:

1. Experts say the greater the exposure of the ment, the longer is the period of its impact among the readers. Therefore experts feel if an ment stays in the memory of a consumer for a longer time, chances are quite probable that he might opt for purchasing or availing your services as and when required. This counts for higher sales and brand awareness.

2. A newspaper reader is so involved in his reading that sometimes the content in the ments creates an emotional impact on him. It is this power of being able to evoke an emotional response with the reader that goes in favor of newspaper advertising.

3. In other media, especially online media, people get perturbed by the distractions in the form of pop-ups and other ment forms that keep flashing on and off the screen. In fact experts’ points out that instead of having any favorable impact, these ads serve to distract the readers. However newspapers, point out experts, involves a focused reading where there are no disturbing and unwanted flashes of ments. As there Page 31

Marketing Strategy of Flipkart is no distance between the reader and the story it seems that the reader actually undergoes all the emotions in the story himself, leading to increase in the trust factor. Taking advantage of this trust quotient, rs cash on newspapers to send their messages loud and clear among the readers. Hence, Flipkart has used ments in newspapers and magazines which are colorful, bright; most of the images consist of kids, and have clear messages. Here are some of the ments used by Flipkart in Newspapers and Magazines.

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Marketing Strategy of Flipkart o Online Advertising The number of internet s is on a rapid rise worldwide and is used by people of all age and types. Internet has become a major medium for communication, entertainment and is in the process of replacing traditional entertainment, promo products, and informative Medias. Some businesses are finding that handing out a promo product such as pens, business cards, and mugs are too costly and yield little results. Likewise, traditional marketing forms such as television, radio, newspaper, magazines, etc., are becoming a thing of the past. Internet has also become a major and effective medium for advertising and it has be predicted that the online advertising and marketing is soon going to replace the advertising through traditional medias such as television, radio, newspaper and magazines. I have picked around 10 advantages of online advertising (not in that order) when compared with the traditional offline advertising.

1.Wider Coverage : The online advertising gives your ads a wider coverage and this globally wider coverage helps in making your ments reach more audiences, which may ultimately help you in getting better results through your online advertising campaign.

2. Targeted Audiences when compared with offline advertising, online advertising always helps you to reach the targeted audience and this helps in making your campaign more profitable and getting more relevant leads.

3. Affordable

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Marketing Strategy of Flipkart Another main advantage of online advertising or marketing is the much affordable price when compared with the traditional advertising costs. With a much lesser cost you can on the net for a wider range of audience and geographical locations.

4. Easy to Track and Measure Conversion Measurability and easiness to track the conversion makes online advertising miles ahead on the traditional advertising methods. A lot of effective analytics tools are available to measure online advertising campaigns which help in more improvisation of the ads.

5. Speed Online advertising is much faster than offline advertising and you can start sending out your ads to a wider audience, the moment you start your advertising campaign.

6. Informative In online advertising, the r is able to convey more details about the ment to the audience and that too at relatively low cost. Most of the online advertising campaigns are composed of a clickable link to a specific landing page, where s get more information about the product mentioned in the ad.

7. Flexible Payment Payment flexibility is another added advantage of online advertising and marketing. In offline advertising you need to pay the full amount to the advertising agency irrespective of the results. But in online advertising there is the flexibility of paying for only qualified leads, clicks or impressions.

8. Better ROI Since online advertising is mainly focused on performance based payment, you ROI is sure to be far better when compared with offline advertising.

9. Easy Audience Engagement Page 34

Marketing Strategy of Flipkart Online ment makes is easy for the audience to engage with your ads or products. As an r we would be able to get more from the audience and thereby improve the quality of our ads going forward.

10. Better Branding Any form of advertising helps in improving the branding and online advertising stands a notch high in improving the branding of your company, service or product. Flipkart being an online mega store s its products and the offers in different internet sites, screenshots of which are being shown below

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Marketing Strategy of Flipkart

o Tweets about Flipkart

Flipkart stays connected with its s via twitter, they answer most of the queries’ put up by their customers and carefully evaluate all the suggestions which were posted in the twitter which keeps the customers happy and in turn keep the management of Flipkart happy. Some of the tweets are shown below:

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Marketing Strategy of Flipkart

CHAPTER 4: MARKETING STRATEGY OF FLIPKART Flipkart eCommerce marketing strategies 2016 – I think all types of businesses can learn from their digital business strategy. From startups and small businesses to large local businesses, their focus on the customer, testing market opportunities made available by digital technology and their focus on testing and analysis to improve results. This digital marketing strategies works for 2015, 2016, 2017 Page 37

Marketing Strategy of Flipkart About Flipkart.com Flipkart is World’s top 10 most visited Ecommerce website in India with regards to traffic. Multiple Payment method is available for it’s customers to make Payment easier. Fastest growing ecommerce website in India. Flipkart started back in 2007 with online book selling. After that it entered the telecommunication category by launching mobile phones. Since then it has rapidly grown to other verticals. The reason for Flipkart being so popular is due its innovative features like cash on delivery where after the customer gets the delivery of the good he/she can check the good and make the payment on cash.

The Story Behind ” FLIPKART.COM” marketing strategies 2016 There was the huge risk taken by both the Bansal’s ” Sachin Bansal & Binny Bansal “. (Started with selling of books ). They both got a high profile job in the worlds biggest ecommerce website named

Amazon. Leaving Amazon to start their own company with just Rs 4 Lakhs involved a huge risk as there Page 38

Marketing Strategy of Flipkart was no guarantee that their idea would Succeed or not. It was a result of risk taking only that today Flipkart generates 1.5 cr a day. The online store has spread to multiple categories namely they are Books, music, mobiles, computers, cameras ,home and kitchen applications, TV and home theatre systems, Personal and healthcare products and stationary items as well. I aim to keep this case study uptodate for readers who may be interested. In it we look at Flipkart’s background, revenue model and sources for the latest business results. We can also learn from their approach to digital marketing since they use digital marketing efficiently across all customer communications touch points in our RACE marketing planning framework:

Reach: Flipkart’s initial business growth based on detailed approach to SEO and AdWords targeting millions of keywords.

Act: Creating a clear simple experiences through testing and learning. Convert: Using personalisation to make relevant recommendations and a clear checkout process that many now imitate.

Engage:Their focus on customer experience, “Customer Obsession” as they call it is shown by the way Page 39

Marketing Strategy of Flipkart they consistently outperform other retailers in their ACSI customer satisfaction rating too.

Flipkart business and revenue model I recommend anyone studying Flipkart checks the latest Flipkart revenue and business strategies from their SEC filings / Investor relations. The annual filings to give a great summary of eBay business and revenue models. A good summary of the latest business model initiatives is always available in the latest Flipkart annual report summary. The latest report includes a great vision for Digital Agility (reprinted from 2014 in their

CHAPTER 5: COMPARISON OF FLIPKART Page 40

Marketing Strategy of Flipkart

5.1

COMPARISON BETWEEN FLIPKART AND AMAZON: DEALS AND

SHOPPING EXPERIENCE

Years ago when Flipkart was into the online retail business, it only had to worry about its local competitors from the nation like Infibeam and Homeshop18. However, with the recent entry of Amazon into India as Amazon India, it seems customers finally have a choice and Flipkart actually has a game to play. Which is better? Scroll down. Twenty years ago the word 'shopping' meant going out of your house, maybe to a shopping complex, a store or a mall, select the goods you like, pay for the same and then check out instantly. Twenty years down the line everything seems changed, upside down. Today 'shopping' comes with two adjectives serving the very word as options: 'online' and 'in-store'. Today, to buy anything we think twice. Whether we should buy from a store nearby or check out the whole bunch of options available online is a matter of great confusion for us. The good part of the whole scene is that today the typical customer/ is has so many options available just a few clicks away. If you want to buy a new laptop you don't need to go to that boring retailer's shop anymore and tolerate him making you wait for another hour because you've never bought a laptop from him, only blank DVDs and stuff. On the other hand, the retailers' fraternity are running at a huge loss and it is likely to happen that sooner or later no one in the society would consider opening a store again Page 41

Marketing Strategy of Flipkart because the future is at great stake because of the big hats. However, leaving all that aside in the name of 'business' ideas and 'right to profit', we are going to discuss and compare two big giants in the online retail world of India – Flipkart and Amazon India.

Flipkart vs. Amazon: Compare eCommerce sites Before we proceed any further and lay out our conclusions, the question is why we are comparing Flipkart and Amazon. Why not look at the broader picture and include more rivals like Homeshop18, Infibeam etc. The reason is Amazon is a foreign company and practically world's largest in the field of online retailership. Their entry into the Indian market is a recent news and before their entry our undefeated champion from the locals was Flipart. Is Amazon India going to enter our markets and defeat the most popular online retail company of India because of its age long experience or will Flipkart be able to defend its goodwill in the market, stand the competition in a dominative manner and will tell the world – no breaching our gates? Well, we cannot foresee the future very much but we sure can lay out our views, comparing the two hulks. History and Foundation - Whenever discussing about any business or industry, discussing the history seems sensible. It is not an unknown fact that in the field of online retailership, Amazon was the first one to come and tap the button. It took Amazon years because it actually made some real profit out of the business. Surely, they have much more substance when it comes to experience. On the other hand, the creators of the Page 42

Marketing Strategy of Flipkart Indian banner, the Bansals are products of IIT Delhi and before they actually started Flipkart, they had worked in Amazon for a few years. It wouldn't be wrong to say that the creators of Flipkart drew experience from the very company they are competing today. Now, the question is whether experience enough can beat the intellect and intelligence of two engineering minds from the best technology institute of the nation? Risks and Backup - Talk about who has more to lose in the battle of sales figures. Well, surely Flipkart. The reason why we're putting forward this argument is the fact that Flipkart does only one kind of business, which is that of online retailership. Besides just more experience, on the other hand, Amazon is backed up by more business streams which it's been successfully carrying out. Let's take the example of Amazon Web Services, which is known to be generating a lot of revenue for the company. Even if it loses its hand in the Indian market to its main rival Flipkart, it does not have too much to lose. Amazon Drones and other Innovations - It is a recent buzz according to which Amazon is busy building (or has probably built) drones to increase its business. Sooner or later drones will be acting as your local delivery boy and will be delivering goods at your footsteps and giving online retailership just another level. So, you don't have to worry too much anymore whether the person delivering goods to your address is confused at how to find your address. Who knows? Maybe Amazon someday makes it possible: a customer wishing to get delivered a set of books merely has to locate his house on Google maps and a flying machine comes with the stuff you ordered. Books - Both the companies started their journeys and turned out popular but how did Page 43

Marketing Strategy of Flipkart they start? Both the brands are known to have started their travails with books. Books was what Amazon began with and it was what Flipkart targeted to achieve first when they were nothing but a warehouse. However, talking about books, it is a popular opinion that Amazon is cheaper dealing with when it comes to books. Not only does it involve less shipping charges, it has more seller options usually. Model of working - Comparing Flipkart and Amazon, one can dig out the old pages and the new and can infer that both the companies had started with their own warehouse but today, both follow the common similar marketplace model. However, talking about the same, Flipkart and Amazon India are known to be sharing a difference which is again about books. While Flipkart enjoys putting its warehouses into good use when it comes to stocking books, Amazon likes to continue working in the trend it enjoys – that is, with the marketplace model. Presentation - Now, do we really need to put up our own opinion about the presentation and looks of both the brands? While the website of Flipkart is presented with the use of bright colors and beautiful buttons, Amazon lags much behind in the name of presentation and colours, if not in anything else. Amazon Kindle - Now, Amazon has an extra advantage, the advantage of technology, invention and innovation. We all know about the Amazon Kindle. And in case you do not, Amazon Kindle is an ebook reader specially designed by Amazon for enabling its customers buy ebooks from Amazon and read on the Kindle. Kindle is blessed with charged ink technology and does not use the normal LED/LCD displays, hence reducing the strain on the eye to an extent, it almost pushes you to buy the ebook instantly for Page 44

Marketing Strategy of Flipkart your Kindle. And anyway, ebooks come at much lower price than the hard copies of books. Not only do they save paper, it seems they are the future of reading. On the other hand, Flipkart doesn't seem to be doing that awesomely when it comes to the sale of ebooks. Definitely, Flipkart has not been of much use when it comes to invention. They do not have something like the Kindle of their own and it doesn't seem likely to be in near future either. Amazon's Google App Store - Now this is just brains, not too much technology, not another 'invention'. Besides trying its hands on all other kinds of business, Amazon has its own collection of Google App Store products which you can purchase and . Flipkart does not have a business of this kind. Ease-of-Use and Convenience - When it comes to ease of use and convenience, we do not hesitate to vote up the brand from the nation. Flipkart does have a very appreciable and convenient way for the typical customer. Log on to the Amazon India website and all you find is a confusing set of links. You do not understand where to click and where to not. Besides, if a wants to order something at Amazon India, let's say a book, he cannot do it just like that. One needs to have a at Amazon, separately ed by the . This kind of rudeness is something which the Flipkart people haven't shown. If you have a Facebook or Google , all you need to do is use your credentials, feed in the details and place your order. There is no need to create a special Flipkart , ing separately for the same (even though you could, if you really want to). Amazon has a lot of stuff like Prime hip and a lot of more confusing booty Page 45

Marketing Strategy of Flipkart traps which Flipkart choses to avoid. Even the search facility on Flipkart was something we greatly ired. Same Day Delivery - Recently after its entry into the Indian retailosphere, Amazon India came out with something called 'same day delivery'. According to this plan, if you are a customer and are so desperate to get the products you ordered that you want them delivered on the same day, you can enjoy this facility. All you have to do is pay an extra fee of Rs. 99. But recently, even Flipkart launched the same feature; however the better bet here is because you have to shell out Rs. 9 less. You need to place your order before 6 pm and the order will be delivered to you within the same day. If however you place your order (on Flipkart) after 6 pm, your product(s) will be delivered only the next day. So, when comparing Amazon and Flipkart on same day delivery services, both offer pretty much good services. Delivery Manners - There's a subtle change in the manner both the companies. Let's say you order two things – a book and a movie DVD. It may be possible that you receive your book the next day by Amazon and the DVD may arrive a few days later if the seller takes more time to ship it. However, the same is not usually true with Flipkart. What Flipkart will do is – it will ship the two products together, in the same package and will most likely make you wait. While some favour Flipart's shipping habits, the others believe Amazon India does it better. Some may like the responsibility Amazon takes by shipping the product as soon as it can reach the customers, some believe Flipkart understands how a person expects his products to come all together, keeping things simple. While some say that Flipkart does this to save its expense on shipping the package, some opine that Amazon too saves its expense by avoiding any midway Page 46

Marketing Strategy of Flipkart intervention in the delivery process. Selling your product - A mere look at Amazon India's top left area will let you to the 'sell' page. It elaborates the as to how he/she can actually sell his product on Amazon India without going through an elaborate process to get his business listed in the website. Conclusion: Which is eCommerce service is better - Amazon or Flipkart Any business starts and advances because of many virtues. One of them is public goodwill. Over the years, Flipkart has earned a lot of that in India but then Amazon cannot be overlooked just because it's new in India. It cannot be ignored that they know how this system works. They understand this business as they are the trendsetters. While Flipkart seems to be giving Amazon a tough go in India, Amazon is trying its bets. Flipkart offers you simplicity, beauty and ease of convenience, Amazon offers you a promise which comes to it through the expertise. Amazon has readymade advantages like Amazon Kindle, other revenue sources and easily approachable system, it seems as though it is trying to play rude with people who want to buy products from its market by compelling to open up their own s in Amazon even when almost everyone has a Facebook and can easily use the same to place the order. Flipkart seems to understand that a comes to it to buy products and not to buy its tantrums. It would be too early to decide which of the two is going to dominate the Indian markets, but one things is sure: Flipkart is going to have a tough time if it does not Page 47

Marketing Strategy of Flipkart keep up.

5.2 Amazon v/s Flipkart v/s Amazon In the 90s we saw the dot com boom; do we perceive the e-commerce sector growth in India with the same hype? Well, it’s booming for sure but what happens next is yet to be seen. The intense competition in this space, especially among the top 3 players Page 48

Marketing Strategy of Flipkart is good for the consumers. Flipkart, Amazon and Snapdeal, all of them have raised investments or have commitments of $1 Billion or more. All 3 work on a marketplace model but have some areas where they excel or differ from one another as to be able to grow rapidly in a short span of time is the real aim. Flipkart follows an invite-only model to sign on sellers which is more time-consuming. Note that Amazon doesn't sell, but it is a glorified marketplace, for now; competing with Ebay in that space; whilst Flipkart has also launched a similar service. Not to forget other promising entities like Yebhi, Quickr which are also making a shout-in in other categories. In the classifieds sector the Indian based Quickr is facing stiff competition from the OLX. When and who will come out as the outright winner and why? Compare the data below.

Initially, before Amazon entered the Indian market, the industry had several players Flipkart, Myntra, Snapdeal, Let's Buy, India Times Shopping, Fashion and You and others. With huge funding coming from foreign investors like Softbank to huge VCs betting on them, the big fish, the piranhas started consolidating and eating up (acquiring) smaller players like Let's Buy, Urban Touch etc.

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Marketing Strategy of Flipkart Present scenario in Amazon vs Flipkart vs Snapdeal Market share of these sharks has increased considerably. The three major Players are Flipkart, Amazon and Snapdeal. We can’t envisage any new player emerging from the mirage. The sharks have now become bigger for the ocean as Flipkart acquired Myntra. Money is being poured in at an alarming rate. As Flipkart announced a $1 billion financing, Amazon decided to steal Filpkart's thunder by announcing that it would invest $2 billion in its Indian entity. Tapping the maximum possible market is the key & obviously demographics are a factor. The final Scenario Only 2 major players left. Flipkart and Amazon have to survive this. Snapdeal has an outside shot. Flipkart will go for an IPO in either US or Singapore (* Flipkart files to become a public company ). E-commerce will eventually drive towards profitability though, the smaller sharks will be eaten up by the bigger ones, either via acquisitions - or we'd see plenty of mid-size sharks forming alliances. The online commerce market in India has a very low penetration. We haven't even begun to scorch the surface here in of potential. India does something around $3 billion a year in Commerce; whilst China does something around $100+ billion major due to the Jack Ma led Alibaba which recently got listed on NYSE (*Alibaba valuation analysis ). As of today, the biggest player in this market is Flipkart, followed by the rest. Amazon has covered a good percentage of market in a short time, but the race has just started & Flipkart’s already some paces ahead, for now. Flipkart's investors knew that the real e-commerce battle in India was not Flipkart versus Infibeam or Snapdeal. They knew even before the launch of Amazon.in that the real contender was Amazon. Amazon India’s sales are estimated at over $200 million (Rs 1,200 crore). It took flipkart 7 years to achieve the sales numbers, snapdeal expects to reach it this year while amazon might clock Rs 6,000 crore by the end of March 2016.

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Marketing Strategy of Flipkart Face-off India's biggies, Wipro's Azim Premji and Infosys' N R Narayana Murthy, have placed their bets on the burgeoning $3-billion e-commerce market space too. Azim Premji has sided with Myntra (acquired by flipkart) & Snapdeal while Narayana Murthy has placed his faith on Amazon.There's not going to be one clear winner considering the funds these firms are pooling in. Over the next few years, each of these companies will find a niche that they'd dominate, and go for aggressive expansion. And India is a huge market, and whosoever scales faster the better. It has become a three-headed race. But everyone is just as well equipped to scale as fast as anyone; so then it will all boil down to branding, and management. The fight is not just about logistics but also about penetration, eventually though all boils down to the revenue.The market is too big, and a large amount of population is yet to put internet to productive use; we can see the internet of things put to work to a huge-ass market like India. However, the concept of IOT is yet not established as compared to the developed markets. In the next 5 years, the landscape will completely change. Flipkart and Snapdeal will diversify in other sectors and will no longer be just an e-commerce site. Just how Amazon has invested in Kindle, cloud services etc. Flipkart had started a payment called Payzippy; though it didn't work out for them. They are trying to expand across various channels that'll add to their revenue.

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Marketing Strategy of Flipkart

CHAPTER 6: SUGGESSION AND CONCLUSION

SUGGESTION: Flipkart has successfully placed itself into the prospects mind making it the India‘s 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 Amazon.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 of females are still unaware of Flipkart. 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 amazon being a huge company will use its economies of scale to remove their

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Marketing Strategy of Flipkart 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

Conclusion A credible rival can do wonders to an enterprise and Flipkart is no different. The entry of Amazon in India has enabled Flipkart develop a lot of in-house innovation and organically developed best-practices - that have now become the industry standard. Flipkart began operations on the consignment model; goods were procured from suppliers on demand, based on the orders received through the website. Later, the booksto-electronics e-shop adopted the warehouse model. The company had its own warehouses, and maintained its own inventory. However in July 2013, Flipkart launched its model of marketplace just one month after Amazon launched its marketplace in India. It introduced payments brand PayZippy for online merchants and customers seeking fast, hassle- free and safe payment options. Some 70 per cent of its shipments are done by its own logistics company and about half of deliveries are on a cash-on-delivery basis. Flipkart has recently introduced the next day guarantee delivery service and Page 53

Marketing Strategy of Flipkart shopping from its own mobile application. Given the critical mass of transactions Flipkart controls - about 100,000 a day - the company is betting that it has the volumes to lay the foundation of what will be a profitable business. Last but not the least; Flipkart has very clearly prioritized customer delight as its chief avenue for customer acquisition and retention. This causes them to build a lot of slack into their existing systems causing higher costs at several points in the supply chain. How they address this challenge is what will determine their future success.

CHAPTER 7: BIBLOGRAPHY

 www.wikipedia.com 

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Marketing Strategy of Flipkart

CHAPTER 7: ANNEXTURE

 Please tick the age group you belong to.  16-25 Page 55

Marketing Strategy of Flipkart  25-35  35-50  50 or above 1. Gender  Male  Female 2. Please tick your occupation Salaried Professional  Salaried senior/ junior executive  Business  Student  Unskilled  Others, please specify ________ 3. Please tick your income range  Less than Rs.2 lakhs per annum  Rs.2 to Rs.5 lakhs per annum  Rs.5 to Rs.8 lakhs per annum  Rs.8 to Rs.10 lakhs per annum  More than 10 lakhs per annum 4. Please tick your education as relevant Page 56

Marketing Strategy of Flipkart  Post graduate  Graduate  Higher secondary school certificate  High School certificate  Less than 12 years in school 5. How frequently do you shop through e-commerce websites  Most Likely  Very likely  Not likely  I never shop online 6. Are you aware of Flipkart – an ecommerce website  Yes  No 7. Which is your most preferred e-commerce website  Flipkart  Jabong  Snapdeal  Others, please specify___________  I do not use e-commerce websites Page 57

Marketing Strategy of Flipkart 8. Please rate the friendliness of the e-commerce website which you prefer the most (1-5, excellent to very poor)  For product comparison  For price comparison  Payment options offered  Speed of website 9. How frequently have you used the ecommerce website for getting information before shopping at a physical store (always, most often, often, quite rarely, rarely, never)  Product specifications  Price comparison among products 10.Please rate your expectations in a shopping model (in a scale of 1 – 5, Least preferred to most preferred)  Convenience Minimum delivery time  Product trial experience  Discounts/ deals  Product variety 11.Tick all the product varieties that you generally prefer buying online  Clothing  Personal products (perfumes, beauty creams, razors, toothbrush) Page 58

Marketing Strategy of Flipkart  Mobiles/ tablets  Laptops and accessories  Cameras  Books  Digital products

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