Customer Relationship Management – Buyer Side

Group 4:
Abhinav Matharoo | Mohd Zia Arif | Divyansh Bengani | Neeru Baghel | Sunali Panda
 Industry Landscape
E-commerce in India Customer Expectations from E-commerce
• The ecommerce industry in India is expected to surpass the US to Expectations from E-commerce Platforms
be the 2nd largest e-commerce market in the world by 2034.
10
9
• The major reasons for this growth has been an increase in 9 8.3 8.2

Importance - on 10 point scale

7.5
internet, smartphone penetration in the country and increasing 8
7
7
share of the organized sector in Indian retail markets 6
6
5
• Flipkart along with Myntra have the highest market share of 5

36.5%. 4
3
• Many government schemes such as Digital India and Make in 2
India have provided a boost to the industry 1
0
Product variety Delivery speed Packaging Affordable/low Discounts & Platform Customer service
E-commerce Market Size prices offers experience
(intuitive)
250
200
Value in Billion USD

200 • Rapidly changing customer demands and rising expectations call for an
urgent need for customer relationship management
150
100 64 • Competition in the space with incumbents (own 70% of market share)
50 38.5 and new players (~19K) increases the criticality of customer service and
14 overall experience
0
2014 2017 2020 2026
 Flipkart – Strategic Objectives
JOURNEY OF FLIPKART STRATEGIC OBJECTIVE

Create differentiation
leveraging tech
innovation

Build an efficient supply

chain to optimize
delivery
SUPER-APP
Flipkart Is the Market Leader
Expand capabilities
Indian E-Commerce Market Share by GMV within ecommerce and
complementary services
1.9
31.9 4.7 31.2 3.3 1.8 16.5
Increase customer
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% retention with loyalty
programs
Flipkart Myntra Amazon PayTM Mall SnapDeal Big Basket Others
 CRM at Flipkart
KEY VALUES OF FLIPKART… …TRANSLATED TO CRM INTIATIVES
AUDACITY Fundamentals
A - Think big
- Challenge existing norms
- Innovate continuously and fearlessly Order Tracking Easy Returns Flipkart Assured Seller Quality Call Center
BIAS FOR ACTION
B - Take speedy and data driven decisions
Vision Evolution
- Have high impact Create the
ENHANCING
CUSTOMER FIRST “Social
C - Wear customer hat commerce
RETAINING
- Continuous drive to understand platform for
customer Bharat”
SATISFYING
- Validate Success = customer actions
- Resolve customer issues by going deep
into the problem Vision
ATTRACTING

FUTURE:
Move ahead from acquisition and retention to engaging profitable customer
Transform into a SUPER APP like Gojek of WeChat.
 Evolution of FK’s Loyalty Program
Flipkart Plus Flipkart loyalty was initially a
binary (in-or-out) program. In
Flipkart First • No membership fee, 2020, it has evolved to a tier
• Abandoned the loyalty program system giving benefits to all
subscription loyalty • Rewards ecosystem, shoppers that use Coins and
model due to low points on purchase not just Plus customers
awareness & inability • Free & fast delivery.
to compete with Early access to sales.
Amazon Prime Priority customer care

2014 2016 2017 2018 2019

Flipkart First Flipkart Pay Later SuperCoins
• Subscription service, at • Provided zero-interest • Reward currency, 200
Rs. 500 in to compete credit line of Rs 5000- Supercoins used to
with Amazon Prime 10,000 based on credit subscribe to FK+
score • 2 Supercoins earned on
• Offered free shipping, • Checkout without shopping for Rs 100
one-day delivery and credit-card. • Redeemed for vouchers
priority customer service • Targeted at youth + on 3rd party apps, EGVs,
middle class discounts etc.

Rationale:
Flipkart Plus’ earn-in loyalty program is the 1st of its kind in India, to create a differentiation, they have modified the program, away from a subscription
model, over the years. Since then, changes have been mostly cosmetic with changes is earn rate (x coins on INR Y purchase) & burn rate (redeem on
vouchers). The aim of this program is to lock-in highly valuable customers – here valuable is in terms of high transaction per customer (TPC)
 Key Initiative for Customer Traction
LOYALTY &
AWARENESS ENGAGE DISCOVERY PURCHASE ADVOCACY

2 4

1 3 5

Flipkart Video Flipkart Game Zone Flipkart Ideas Flipkart & EKart Super Coin
• OTT Platform to compete • Games that rewards • Allows brands, micro • Uses AI/IoT and • Currency for 100+
with Prime Video players in ‘Gems’ influences to help analytics to provide platforms
• Increase brand recall • Can be converted to customers recommendations Flipkart Plus
2GUD SuperCoins • Aids in discovery, • User profiling to • Spend more to
• Social commerce platform • Adding multiplayer inspiration and post tailor experience become a member
• Enhance relations with features engage purchase hand Flipkart Quick
millennials and Gen Z friends of customers holding • 90-minute delivery
 Benefit to Different Customers on Flipkart+
Flipkart Plus has pushed the TPC increase* from 5% to 15%!

• For the e-commerce industry, more than profitable customers, firms try to lock in their
High-TPC (transaction per customer) consumers Butterflies True Friends

High TPC
• For this purpose SuperCoins are not solely rewarded on the transaction amount Flipkart Plus
• 2 supercoins on a Rs. 100 purchase for non-plus members and 4 supercoins (SC) on a Customers
Rs. 100 purchase for Flipkart Plus members
• No more than 50 SC (i.e Rs. 2500) can be earned on a single order.
• This is done to make sure the reward program incentivises higher number of
transactions rather than higher ticket purchases, since the firm benefits through Strangers Barnacles
more transactions & traction rather than value of the purchase
• Flipkart’s loyalty scheme is more of a non-discriminatory tiered system rather than an in-or-

Low TPC
out binary system such as Amazon Prime
• A short-term, low TPC customer making a single purchase of Rs. 2500 will receive 50
SCs
• A “True-Friend” would benefit from a FK+ membership which costs 200 SCs i.e. a total Short- term customers Long- term customers
purchase value of Rs. 10,000

Potential Problem: Here, a person transacting X times Flipkart with a average order value of Rs. 2500/- will receive the same benefit
(SuperCoins) as a customer transacting X times with an AOV of Rs. 10,000!
Source: Primary interviews, Flipkart Plus program details Note: TPC increase is often organic due to new products being listed etc. – there is a y-o-y growth of 5%
Flipkart Plus vs. Amazon Prime
Criteria Flipkart Plus Amazon Prime

Objective Customer retention & high TPC Customer acquisition & benefits

Membership Inclusive, free-membership based on minimum Exclusive, Subscription based

spend / transactions

Structure Aspirational: non-uniform benefits to users Non-aspirational: same benefits to all users

Benefits Off-platform benefits on 100+ platforms (oyo, ola Amazon-only platform benefits
etc.)

Total Users 5 million 10 million

 Flipkart vs Amazon: Overall Experience
Comparison of Flipkart & Amazon Customer Service
10
9 8.69
8.42
8
Issues Requiring Customer Care
8 7.76
7.36 ~90% customer complaints are
6.71 Other regarding product/delivery issues
7 2.0%
with 26% being related to
6 damaged products which is a
Information on discounts/deals 5.3% cause for concern!
5
4 Delivery related issues (late, mispl aced etc.) 22.5%

3
Incorrect/mismatched product 19.9%
2
1 Damaged product 25.8%

0 Refund/return issue 24.5%

Customer Service Shopping Experience User Interface
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Flipkart Amazon

• Flipkart’s overall shopping experience is rated lower than that of • Flipkart’s chat & social media service has an average rating of
Amazon’s primarily due to two factors 4.7/10, as compared to Amazon’s 7.8/10. Customer complaints were
• Comparatively lower product variety across categories: around the standard chat-bot replies that do not help in problem
Flipkart is the preferred choice only in electronics resolution
• 77% respondents stated that Flipkart recommendations are • 33% customers prefer chat service to calls for customer service in
mismatched as compared to Amazon’s recommendation general. These channels need to be developed & made more
system responsive and reliable to address customer concerns
Source: Primary Research; N=225
 Competitor Benchmarking: FK+ vs AZ Prime
Loyalty Program Awareness Loyalty Programs: Usage
100% 90% 86%
92%
90% 80%
80% 70%
70% 65%
60% Perceived value of FK+ is low, SuperCoins
60% 47% are valuable for discounts. FK+ should
50%
50% build & promote an ecosystem of offerings
40%
40% 35%
30%
30%
20% 20% 12%
10% 10%
8%
10% 10% 4%
0% 0%
Flipkart Plus Amazon Prime Snapdeal Gold PayTM First None Flipkart Plus Amazon Prime Snapdeal Gold PayTM First None

• Awareness of Flipkart Plus lower as compared to Amazon Prime. • Of the consumers aware of Flipkart Plus, only 47% have used or
Among those who had not heard about FK+, 78% respondents redeemed SuperCoins collected – since there is no opt-in cost,
claimed they would be interested in a no-entry fee, reward points consumers save up points in the hope of redeeming them for a
loyalty program. higher ticket purchase
• Flipkart Plus should focus on advertising & promoting its loyalty • Amazon Prime has a subscription fee of Rs. XX/year. This induces a
program to build awareness and get customers into the perceived cost of & hence drives consumers to use it consistently.
consideration pool Usage is higher due to the entry barrier.

In-depth interviews with revealed that consumers opt for Amazon Prime primarily for the video streaming service and free/fast deliveries are a welcome benefit.
Flipkart Plus users opt in for easy access to sales & discounts through SuperCoins.
Source: Primary Research; N=225
 Competitor Benchmarking: FK+ vs AZ Prime
Flipkart Plus vs. Amazon Prime
10
9.02
• Reward points in a loyalty program seems to be the
9 8.67 preferred model among users, over a subscription (yearly
8.4
8 7.29
7.64
7.35 payment) model
7 6.53 6.47 6.71 6.35 • 73% users preferred reward points over a one-time
6 payment loyalty program
5 4.67 • Hence, although Flipkart’s current program has a lower
4 3.65 rating than Prime, the potential for it to scale up is high
• Their “SuperApp” and network synergy strategy will help
3
improve the current offerings to meet customer
2
expectations
1
0
Free Delivery & Subscription Reward points Discounts & Video streaming Customer service
Speed charge offers Preference forType of Loyalty Program
Flipkart Amazon
Subscription based
• Video steaming & customer service are the differentiating factors that make
Amazon Prime the preferred loyalty program among consumers 24.49%
32.65%
• Flipkart Video has partnerships with local channels which taps into their Tier 2 Reward points based
market segment from where they get majority of their customers – the current on purchases
survey was a mix of cities and might not bring out the intricacies of different
customer preferences 42.86%
• Ultimately, 80% customers preferred to recommend Amazon Prime to their Indifferent
friends & family over Flipkart Plus
Source: Primary Research; N=225. In-depth interviews N=13
 Competitor Benchmarking: Flipkart vs Amazon
Flipkart Vs Amazon App
App Rating Vs Total Reviews Sentiment Analysis
Reviews
4.5
6%
2% 11% 14% 18%
5%
2% 4.4
5%
21%
15%
4.3
%Age of reviews

App rating
4.2
2
86% 82%
3 4.1
67% 66%
4
4
5

3.9

Flipkart Amazon 3.8 Flipkart Amazon

0 20 40 60 80 100 120 140
Total Reviews 12,971,114 5,877,984 Postive Negative
Total ratings in lakhs

• 88% users voted Flipkart 4/5 vs 81% for Amazon on PlayStore ; in absolute terms Flipkart received 6.6M • Low rating in customer
more 4/5 star reviews than Amazon service not reflected in
• 1 /2 star reviews for Flipkart app are lower than Amazon; Flipkart has edge over competitors in terms of In- social media sentiments
App Experience
 Technology Selection and Implementation
Process Identifying business need Technology & vendor Solution Development &
CRM & gaps in existing process selection Implementation
Technology

• Automate inbound & outbound • Ameyo CRM system chosen due to • Replaced manual dialing with automated
processes (order tracking & calling) easy integration with existing in-house calling for customer reps
• Seamlessly integrate with existing systems & higher uptime • Campaigns triggered through routing
systems • Solutions across customer service & algorithms
• Handle a large volume of calls campaign management • Omnichannel communication (SMS, chat)

• Standardize Incident Management • Oracle Service Cloud chosen since it • Replaced response system & integrated
System across all customer support supports voice and e-mail integration in all channels, sentiment analysis
channels • Knowledge mgmt. module to provide
consistent answers across channels

• Easy seller onboarding process • Salesforce Service Cloud CRM chosen • Streamlined seller acquisition and partner
• Track conversion of sellers since it automates service processes, onboarding process through workflows
• Improve training for faster streamlines workflows • Integrated in call centres to better support
onboarding • Support for customized applications sellers through live tracking
• Improve employee collaboration • Mobile app for sellers (training/tracking)
• Employee collaboration using Chatter
 Recommendations

Customer Service Flipkart+ Awareness AOV vs. TPC CRM Technology

• Amazon being a benchmark • Despite its large overall • The SuperCoins model • Multiple platforms are
for service quality, Flipkart userbase, there is low doesn’t offer benefits to being used to serve
must increase focus on awareness of Flipkart’s new high-ticket customers (high different use cases.
customer service initiatives (Google trends) AOV) but only focus on Integration and scalability
increase in transaction per could be a challenge
• Improve new channels of • #BigBillionDays is Flipkart’s customer (TPC)
social media/chat largest sale event that is • Users are increasingly
widely marketed through • Finding & striking the right looking to bundle
• Integrate & improve after- multiple channels – the balance between the two complementary products,
sales service through Jeeves same needs to be done for metrics, and incentivizing thus there is a need to
to resolve broken/dysfun- Flipkart Plus, Video, Games both will add value improve the
-ctional product complaints etc. recommendation system
(current rating is poor)

Overall, there is an alignment between Flipkart’s strategic objectives and its customer relationship management initiatives, but building
awareness and improving certain aspects of the current offerings will help further develop customer loyalty.
Thank You!
Google Search Trends
Flipkart vs. Amazon

Flipkart Plus vs. Amazon Prime

References
• https://www.ibef.org/industry/ecommerce.aspx#:~:text=India's%20internet%20economy%20is%20expected,the%20highest%20in%20the%
20world.
• https://www.flipkart.com/pages/supercoins-tnc
• https://www.flipkart.com/plus-offers/exclusive-offers
• https://www.flipkart.com/watch-videos-online-store
• https://nextbigwhat.com/laptops-on-amazon-and-
flipkart/#:~:text=Flipkart%20has%20467%20offers%20under,are%20considered%20as%20single%20SKU.
• https://www.trustpilot.com/review/www.flipkart.com
• https://thoughtoverdesign.com/work/flipkart
• https://www.quora.com/Which-has-a-better-user-interface-Amazon-or-Flipkart-Why
• https://trends.google.com/trends/explore?geo=IN&q=Flipkart,Amazon
• https://www.social-searcher.com/social-buzz/?wblng=&ntw=&psttyp=&searchid=&period=&value=&fbpage=&q5=flipkart