INTERNSHIP at RAJESH EXPORTS Ltd.

A report submitted in partial fulfillment of the requirements

for the award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

of
MAHATMA GANDHI UNIVERSITY, KOTTAYAM, KERALA.

Submitted by
KOCHUTHRESIA JOSEPH
REG NO:

Under the guidance of

Prof. PRAJITH
(Associate Professor)

JULY2021
DC School of Management and Technology
Pullikkanam, Vagamon, Idukki 685503
Tel: 04869 – 248322, 248323

1
 DECLARATION

I hereby declare that the project entitled “Internship at RAJESH EXPORTS ltd”
submitted by me for the award of the degree of Master of Business Administration of the
Mahatma Gandhi University, Kottayam, Kerala is my own work. The report has not been
submitted for the award of any other degree or diploma of this University or any other
University.

Place: NAME: KOCHUTHRESIA JOSEPH

ROLL NO:

Date: SIGNATURE:

2
 D C School of Management
and Technology
One School Avenue
Pullikkanam PO, Vagamon,
Idukki - 685 503, Kerala, India
Phone:( 91-4869) 202110
Fax: (91-481) 2564758
Web: www.dcschool.net
E-mail: [email protected]

CERTIFICATE

Date 00/00/2021

This is to certify that the report entitled “Internship at RAJESH EXPORTS Ltd”, is

a bonafide record of the work done by Ms. KOCHUTHRESIA JOSEPH Reg. No. under my

guidance, in partial fulfillment of the requirement for the award of Degree of Master of

Business Administration of Mahatma Gandhi University, Kottayam, Kerala and to

endorse that this work has not been submitted by him/her for the award of any other

degree, diploma or title of recognition earlier.

Prof. Prajith (Faculty Guide)

This report has been accepted and forwarded to the University for evaluation based on the
recommendation of the Faculty Guide.

Principal

External Examiner 1 External Examiner 2

Signature Signature
Name Name
Date Date

Admissions Office: DC Kizhakemuri Edam, Good Shepherd Street, Kottayam 686 001. Kerala, India
Phone: 0481-2563226, 2301614, Mob: 9745607093/9846869231 e-mail: [email protected] Portal:
www.dcsmat.ac.in, Web: www.dcschool.nE

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 ACKNOWLEDGEMENT

On the successful Completion of my Internship Study, I express my deep sense of

gratitude to my Internship Guide Prof. Prajith, for his valuable guidance and support.

I express my sincere thanks to Dr. Sreekanth S V (Director and Principal) for all the
encouragement and help extended during this course of project.

I proudly utilize this opportunity to express my deep sense of gratitude to Dr.Jyothi

Vijayan (Batch Coordinator) for the kind of assistance and guidance given to me for the
preparation of this project.

Finally, I thank my heartfelt thanks to the Almighty God, my parents and friends, who
empowered me to complete my study.

PLACE: PULLIKKANAM Name: KOCHUTHRESIA JOSEPH

Date:

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 LIST OF CONTENTS
SI. TITLE PAGE No.
No.
1 AN OVERVIEW OF THE INDUSTRY 9-28
1.1 Brief History of the Industry 9
1.2 Business Process of the Industry 13
1.3 Market Demand and Supply – Contribution to 18
GDP -Revenue Generation
1.4 Level and Type of Competition – Firms Operation 21
in the Industry
1.5 Pricing Strategies in the Industry 21

1.6 Prospects and challenges in the Industry 24

1.7 Key Drivers of the Industry 26

1.8 Stalwarts in the Industry 27

COMPANY PROFILE 30-52

2.1 Brief History of the company 30
2.2 Business Process of the organization 35
2.3 Customers of the company/ Level of operation 37
2.4 Competitors of the company 39
2.5 Strategies – Business, Pricing, Management 41
2.6 CSR Activities 45
2.7 Export/ Import -
2.8 Collaboration & Expansion 48
2.9 SWOT Analysis of the company 50
3 INDUSTRY ANALYSIS - Porter’s 5 Force Model 54-58
4 DISCUSSION 60-64
4.1 Objective Assessment – observation by the 60
Candidate about the organization
4.2 Specific Learning Outcome 62
5 FINDINGS – Summary of findings – Critical Observation 66-68

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 by the candidate about Industry and Organization
BIBLIOGRAPHY 70
ANNEXURES 71

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 EXECUTIVE SUMMARY

The internship report is about RAJESH EXPORTS ltd, also known as the global leader
in the Gold busine. The company is operating under this industry since 1989.

This internship study is done to understand the functions and business process,
customers of the company, competitors of the company strategies adopted to market
their product their products in the market, CSR activities, import, collaboration and
expansion of the company.

And, it identifies the strength, weakness, opportunity and threats of the company.
Similarly, it understands how this company works in the industry and to familiarize with
the procedure of the company and the competitive strategies adopted by the
organization, market demand and supply, its Gross Domestic Product (GDP)
contribution, revenue generation in the industry, pricing strategies adopted in the
industry, prospects of the industry, key drives, and stalwarts of the industry. Then the
industry analysis through Porter’s 5 Force Model.

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 Chapter – 1

An Overview of the Industry

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1.1 Brief History of E-Commerce

One of the most popular activities on the Web is shopping. It has much allure in it one
can shop at your leisure anytime. Literally anyone can have their pages built to display
their specific goods and services. History of ecommerce dates back to the invention of
the very old notion of "sell and buy", electricity, cables, computers, modems, and the
Internet. Ecommerce became possible in 1991 when the Internet was opened to
commercial use. Since that date thousands of businesses have taken up residence at
web sites.

At first, the term ecommerce meant the process of execution of commercial transactions
electronically with the help of the leading technologies such as Electronic Data
Interchange (EDI) and Electronic Funds Transfer (EFT) which gave an opportunity for
users to exchange business information and do electronic transactions. The ability to
use these technologies appeared in the late 1970s and allowed business companies
and organizations to send commercial documentation electronically. Although the
Internet began to advance in popularity among the general public in 1994, it took
approximately four years to develop the security protocols (for example, HTTP) and
DSL which allowed rapid access and a persistent connection to the
Internet. In 2000 a great number of business companies in the United States and
Western Europe represented their services in the World Wide Web. At this time the
meaning of the word ecommerce was changed. People began to define the term
ecommerce as the process of purchasing of available goods and services over the
Internet using secure connections and electronic payment services. Although the dot-
com collapse in 2000 led to unfortunate results and many of ecommerce companies
disappeared, the "brick and mortar" retailers recognized the advantages of electronic
commerce and began to add such capabilities to their web sites (e.g., after the online
grocery store Webvan came to ruin, two supermarket chains, Albertsons and Safeway,
began to use ecommerce to enable their customers to buy groceries online). By the end
of 2001, the largest form of ecommerce, Business-to-Business (B2B) model, had
around $700 billion in transactions.

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Ecommerce has a great deal of advantages over "brick and mortar" stores and mail
order catalogues. Consumers can easily search through a large database of products
and services.

They can see actual prices, build an order over several days and email it as a "wish list"
hoping that someone will pay for their selected goods. Customers can compare prices
with a click of the mouse and buy the selected product at best prices. Online vendors, in
their turn, also get distinct advantages. The web and its search engines provide a way
to be found by customers without expensive advertising campaign. Even small online
shops can reach global markets. Web technology also allows to track customer
preferences and to deliver individually-tailored marketing.

COMPONENTS OF E-COMMERCE

Some essential must haves to make your shop a success.

1. GOOD EXPERIENCE FOR MOBILE SHOPPERS

In 2013, 55% of people purchased from mobile devices rather than from PCs and
laptops, so ensuring that your ecommerce website is mobile friendly is a must. Mobile’s
increasing market share means that online shop should have mobile first strategy to
ensure getting conversions no matter what device.

2. EASY CHECKOUT PROCESS

The biggest conversion killer for online store is potentially checkout process. One could
easily be losing up to 67% of customers if checkout is poorly planned or designed.
Striking a balance between good functionality, usability and building trust are key to
offering a good checkout experience.

3. GUEST SIGN UPS

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Laborious registration forms can increase the likelihood of customers abandoning a
purchase at checkout so give customers the option to checkout as a guest rather than
register an account. Online shoppers are keen to make their purchases quickly and can
easily be distracted, so help them achieve their goal by giving them a quicker option to
check out as a guest.

4. GOOD QUALITY PRODUCT PHOTOGRAPHY

Product photography could be the single most important aspect of ecommerce site. This
is what helps user get ‘buy in’ and is often the first experience of product.

5. HAVE A CLEAR RETURNS POLICY

The first part of a good returns policy is to try to prevent the return. People return their
products when they’re disappointed so write clear and accurate product descriptions.

6. DETAILED PRODUCT DESCRIPTIONS

Clear and accurate descriptions about products are important to help buyers make the
decision to purchase. Descriptions act like store’s sales staff so it needs to be
informative and the right tone for target. Include an FAQ’s section too to help alleviate
any doubts about products.

7. CLEAR DESIGN & INTUITIVE NAVIGATION

Get clear about shop categories and how online store is structured. Poorly structured
sites don’t perform well and struggle to convert. The goal is to make it easy for
customers to find what they’re looking for.

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PRESENT STATUS OF E-COMMERCE

India has joined the bandwagon and the numbers themselves do all the talking. The
latest statistics reveal that India has been reported to have 70 million active Internet
users, the count rising exponentially by the minute. However, markets involve intricate
interactions involving a variety of business/organizational factors, general economic and
social trends. And the actual scope of growth in e-commerce can’t be evaluated without
taking into consideration the aforementioned factors. For such doubts to be remedied,
one may take notice of the recent industry reports. One such report, shared by
ASSOCHAM, estimated the online retail industry to touch Rs.7000 crore by 2015 (rising
from the current Rs.2000 crore), with an annual growth rate of 35 per cent. Adding on to
this, IAMI has facilitated data to indicate a zoom in India’s e-commerce sector, with
transactions rising 50 per cent annually. Online retailing or e- tailing, which accounts for
about 6 per cent of Rs.46000 crore industry, has taken the forefront of this rapid growth.

Such strong current indications to massive changes, occurring across the entire
business spectrum, have already wiped out doubts about the scope of e- commerce in
India. The expense of the tremendous ambit for the growth of Internet marketing in India
being clear now, it can conveniently be stated that marketing through the Internet can
be an extremely potent ball game. With copious amount of literature, thousands of
articles and multiple studies conducted around e-commerce, it undoubtedly is the new
mantra in the world of marketing. In justification to the aforementioned statement, there
is practically no dearth of e-tailing portals and deal websites floating in the market at this
moment. The basic explanation to such a boom lies in the fact that e-tail has surfaced
as a boon to both the sellers and the consumers. It has garnered significant attention
from consumers due to the convenience of shopping. The need to physically visit stores
has, in some cases, been eliminated. Instead, you can just sit at home and order, easily
browse through a host of products, conveniently compare prices and avail the best deal.
It’s all about saving on precious time, energy, money and get what you desire. On the
flip side, it has succeeded in pleasing the sellers by providing a faster buying/selling
procedure, resulting in saving a lot of time. Now, products can be made available for
purchase and sold around the clock. This also provides a wider reach, defying all

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theoretical geographic limitations in reaching out to customers. Sellers have shown
remarkable enthusiasm for this system as their need to continuously augment and keep
abreast of customer expectations and desires is aptly catered to. Not long ago, when
the concept was newly induced in the Indian markets (first put to practice by companies
like Dell), the average Indian was sceptical. While the west comf through Amazon.com
and e-bay, the Indian market still went after touch-and- feel of products, opulent
Showrooms, salespersons with good etiquette and liquid transactions. But over the
time, with a number of payment gateways coming into the picture and making e-
transactions effortless and trouble-free and curbing security threats, people have grown
comfortable with e-shopping. This to the extent that today, four out of five Internet users
shop or do their pre- shopping research online, thus recording 13.5 million customers of
consumer products and outnumbering 8.5 million customers of travel products.
Customers today are hooked to online shopping and are not even fighting shy of deal
sizes that cross Rs.20000-Rs 25000 while earlier, they hardly went up till Rs.2000.
Industry figures suggest that the soaring numbers in the e- commerce space are driven
by the young blood and these are expected to grow tenfold, being pushed by the
Generation. The most sought after categories for these buyers currently are: mobile &
accessories, computer hardware & consumer electronics and travel products like train
and air tickets. However, plenty of competition has been observed in the e-commerce
market. With countless congruent e-commerce players, the winners will be those who
will be able to provide a delightful experience across the entire ecosystem, will have
robust business models and can scale quickly. Their reward will be to take a healthy
share of the $100 billion industry in the next few years. E-commerce is the new mantra,
building a splendid crescendo of excitement, and it definitely has a long way to go.

1.2 Business Process of E Commerce

An ecommerce process flow can often be an area of online retail that is overlooked. In
order to maximize sales opportunities and stay cost competitive, mapping out your
ecommerce processes can help your business highlight key areas that may require
automation or modification, and ultimately, improve performance.

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Key areas of a typical ecommerce process flow include:

• Receiving orders from your ecommerce system

• Processing order information

• Shipping

Top-Level ecommerce Process Flow:

Unless you are already automating your ecommerce processes, managing ecommerce
orders is a manual process. Employees have to log in and out of different business
systems and databases, which is both time-consuming and prone to errors.

Each top-level process highlighted below holds a number of additional sub processes
(+). For example, when a sales order hits your back office operations employees have
to manually process the information into your business software. This can result in
administration errors and create process bottlenecks further down the line. In an
automated process employee intensive administration tasks are removed.

At the top level of an ecommerce process flow, the following can be easily identified:

• Customer places an order in your ecommerce system.

• Order details are extracted from your ecommerce system and entered into your
business software.

• Order is passed to the warehouse to be processed.

• Order is placed for fulfilment.

Sub Process: Receiving Orders

When a customer places an order within your ecommerce system the order details need
to be extracted and placed into your business software. Manually dealing with

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information held within a sales order can detract from the businesses planned
objectives. Data entry errors can surface, employee efficiency is reduced and
order processing costs increase. The process of receiving the order is
mapped below:

• Sales order details are manually extracted from your ecommerce system. Information
includes customer information, description and ID of product ordered, payment details
and transaction ID.

• Employee manually checks sales order data for a correlation with your business rules
e.g. full address, contact details, products ordered.

• Employee manually enters order and customer details into your business software.

• Employee manually creates and sends an order received notification to the customer.

• If an employee identifies any anomalies they will need to contact the customer to
resolve the issue.

• If an issue cannot be resolved the employee may have to manually cancel the order.

• Order is passed to warehouse for processing.

How automation can help this process:

By automating this process the employee is removed from the scenario. If required,
orders can be pulled on a timed or scheduled basis e.g. every 15 minutes. Orders are
automatically entered into your business software and the customer receives and
automated order confirmation notification.

Sub Process: Processing an Order in the Warehouse:

Once an order has been checked and processed in your business software, the order is
passed onto the warehouse for processing. Here, employees will have to manually

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check the order against your pick list business rules (stock availability, item location
etc.) and create and print a pick list.

• Employee notifies warehouse of an order that needs to be processed.

• Employee manually checks the order against pick list criteria e.g. stock availability,
item location in warehouse etc.

• Employee creates and prints pick list.

• If products are in stock and available, the order is picked and packed.

• Order is now ready for the shipping process.

How automation can help this process:

An automated process will reduce employee time in cross-referencing your business

software for stock availability and product location. It will dynamically automate the
creation and printing of your pick lists.

Sub Process: Processing an Order for Shipping

Once an order has been processed in the warehouse it is now ready to be passed to
shipping for fulfilment with a courier. Here, your business rules will determine which
shipping route the employee chooses. Package data, such as weight, size, destination
and costs, needs to be obtained. An employee will also need to manually print the
shipping labels and contact the courier for fulfilment.

• Employee enters package data, such as weight, size and destination into your courier
provider system.

• Employee prints shipping labels and delivery notes.

• Shipping confirmation sent to customer.

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• Employee may or may not update your business software with tracking numbers.

• Order handed over to courier for fulfilment.

How automation can help this process:

An automated fulfilment process will remove the manual administration in this process
as all package data and courier details will be in your business software. Your business
systems will be integrated with your courier service provider’s solution, enabling them to
‘talk to each other’. An automated process will also provide you with the ability to
automatically print shipping labels. The customer will receive an automated ‘dispatched’
notification, and tracking details will automatically synchronise with your business
software.

Workbook: Mapping your ecommerce Process Flow:

Mapping your ecommerce process flow provides you with a clear overview of where
your processes start and end. It will make it easier for you to identify gaps within your
process models and highlight areas where your business could benefit from automation
or improvement.

The workbook includes:

• Top-level ecommerce process flow.

• Sub process model: Automating the retrieval of sales orders and automatically placing
them into your business software.

• Sub process model: Automating the processing of sales orders in the warehouse.

• Sub process model: Automating the placement of sales orders with courier services for
shipping.

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• Notes for you to map and modify your process models.

• Process automation and system integration recommendations and considerations.

Automating your ecommerce Process Flow Next Steps:

Automating your ecommerce processes provides you with the opportunity to

automatically capture, track and ship customer sales orders. BPA Platform’s
customisable integration and automation capabilities enable you to automate the
delivery of ecommerce activity between your web shop, courier service and your in-
house business software.

1.3 Market Demand and Supply – Contribution to GDP – Revenue Generation

Market Demand and Supply

Most people have become familiar with e-commerce and the Internet by acting as
shoppers in a retail store. They look at what's available, place an order, and wait for the
merchandise to arrive. What they do not appreciate is the miraculous chain of events
they have triggered. The order goes to the fulfilment operation, the distributor, the
manufacturer, or a combination of the above. It is then picked, packed, handed to a
shipper, and delivered. Most of this process is accomplished seemingly at the speed of
light. But what happens when the merchandise is not there to be picked? Another chain
of events is triggered, but these events are less pleasant. The consumer, who ordered
quickly, expects delivery in the same way. As a result, a customer that will not return or
a lost sale has just been created. This phenomenon is placing increased pressure on
managing demand and planning up and down the supply chain.

The "front end" of e-commerce applications, or the order processing, is certainly

important. But, many companies have failed to recognize the importance of the "back
end" systems. Industry experts are raising their voices to emphasize the importance of
the support systems necessary to satisfy the back end requirements. The reaction is to

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go to the back end and fix the warehousing and delivery systems. Millions of dollars are
being spent in shoring up old or creating new systems. This is well and good, but still
missing the target. Somebody, somewhere has to have product.

The manufacturer, the distributor, the fulfilment house, or the retailer absolutely must
have product. The only way to do that efficiently is to plan for product requirements and
replenishment of that product, regardless of where in the supply chain it is being stored
or how it is being transported. Because the profit margins are so slim, the inventory
must be as efficient as possible to open up a share of the e-commerce market.

The magic slogan is: "The right stuff, The right place, and The right time." To do this,
however, requires an ongoing system of planning. That planning — whether it is done
daily, weekly, or monthly — must look at existing inventories, incoming receipts, lead
times, lot sizes, customer orders, forecasted requirements, and requirements from other
distribution channels in order to suggest both a replenishment quantity and required
date. This process is not the front end or the back end, but the "middle end." Without
this piece of the puzzle, all that e-commerce buys is a way to "do the wrong things
faster."

With all the variables involved, an automated or semi-automated solution is mandatory.

That's where the value is in the entire supply chain/e-commerce structure. The return on
investment is lodged in the planning and replenishment. There is return on investment
(ROI), of course, on the front end and the back end systems. But, the largest and
ongoing ROI is in 100% customer service at the absolute minimum inventory
investment. The value grows even larger when all the participants up and down the
supply chain are involved in the planning process.

It is truly amazing that, for decades, companies have continued to cover their lack of
planning with too much or too little inventory. Now, in the world of e- commerce, these
same companies continue to operate the same way and they continue to ignore the
middle end. This is probably because planning cannot be totally objective. There is
some guesswork and some human input to the process, regardless of the degree of
automation.

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Forecasting, planning, and replenishment have been key to the success of most good
companies in the past; that is truer now more than ever. In fact, without an effective
planning system in the middle, a company can go out of business quicker than it got into
business in the world of e-commerce. Implementing the front end and fixing the back
end is important, but concentrating on the middle end where the dollars are to be made
makes a big impact in the world of e- commerce.

Contribution to GDP

Ecommerce made up about 0.71% of India’s GDP in 2016, which increased to 0.76% of
India's GDP in 2017. This was estimated to reach 0.9 percent in 2018. By being the
second largest online market in the world after China, the country's rapid growth in the
digital sphere, specifically following demonetization in November 2016 and the rise of
the mobile payments market facilitates the opportunity for growth in the years to follow.

Revenue Generation

Revenue from e-commerce in India to touch $52 bn by 2022: Report The

revenue from e-commerce amounted to $25 billion in India in 2017, and is likely to grow
by 20.2 per cent per year, says a report. According to a report by Admitad, in 2017, 37
per cent of the population comprised of internet users, 14 per cent of whom made online
purchases regularly. This population's share of internet users is expected to grow to 45
per cent by 2021. The number of online buyers is expected to grow to 90 per cent. Most
purchases (56 per cent) are made via desktop. Smartphones account for 30 per cent of
purchases, said the digital and affiliate marketing company's report.

However, with mobile penetration expected to reach 54 per cent of the population by
2020, m-commerce has a high potential in India, and will likely be responsible for 70 per
cent of e-commerce revenue. The report noted that about 57 per cent of Indians prefer

20
to pay on delivery, while 15 per cent prefer to pay with debit cards, and 11 per cent
credit cards.

"However, this is all likely to change in the near future. With a growing number of mobile
users and the government encouraging citizens to use non-cash payment, there should
be an increase in digital transactions in the coming decade," - Bansal’s said.

Interestingly, India ranks second in the world for the number of internet and smartphone
users, outpacing the US. Meanwhile, China is the global leader in terms of number of
internet users and online buyers. In 2017, the percentage of internet penetration rose to
53 per cent. Even more, 42 per cent of the population made online purchases regularly.

1.4 Level and Type of Competition – Firms operating in the Industry

As in the case of ecommerce industry, it follows a perfect competition.

Perfect Competition

Perfect Competition is a theoretical market scenario where no sellers achieve profit

above break-even and every seller is a 'price taker'. Some e-commerce markets are so
competitive that their sellers are almost in Perfect Competition. As e-commerce
marketplaces continue to improve the efficiency of transactions bringing more efficient
supply from more sellers, the marketplace begins to move towards a perfectly
competitive scenario.

An understanding of a perfectly competitive market can help you take control of your
business's supply strategy, so you're acting strategically, and looking for opportunities
that other suppliers cannot execute on.

1.5 Pricing Strategies in the Industry

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Choosing the right strategy is one of the most crucial decision that you have to make.
Get it wrong, and it could cost big for your business. Online and Offline retailers alike
recognize pricing strategy as one of the key value levers, and accordingly, companies
have worked to refine their pricing strategy, tactics, and tools over the past several
decades in hopes of optimizing their approach. The following are the pricing strategies
followed by ecommerce industry:

1. Cost-based Pricing

Cost-based pricing is a process of setting the price as a result of adding a profit margin
to the cost of the product/service. This pricing method guarantees that certain profit is
obtained above total cost.

II. Market-based Pricing

Market based pricing is the act of setting prices that are closely aligned with the current
market prices of similar products. If this is the case, a business could be set its prices
higher at the introduction of the product, and eventually drop its price point or offer
discounts later, as market interest declines.

III. Dynamic Pricing

In basic terms, dynamic pricing is a pricing strategy in which marketers set flexible
prices by taking into account costs, targeted profit margins, the demand of the market
and your competitors’ prices. In other words, it allows you to set he optimal prices at the
right time in response to real-time demand and competition status while taking into
account your business goals.

IV. Consumer-based Pricing

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Consumer-based pricing is the third common approach firms use to set their prices. In
this case, the firm first sizes up its customers to determine how much each customer is
willing to pay for its product or service and then charges the price each customer is
willing to bear. Customer-based pricing gives the company the flexibility to charge
different prices to different customers, rising or falling to match the size of the
customer's wallet. Theoretically, the firm can achieve a high volume of sales at the best
possible margins.

V. Bundle Pricing

Product bundling is fairly simple. You sell a range of products together for a discounted
price. For example, many products require accessories. Some are mandatory (like a
lens cap on a camera that usually comes with the camera), but some are highly desired,
but optional, like a tripod for a camera. Bundling products of a similar nature is a great
way to increase your average order value because customers are likely to be looking for
similar things. Someone buying a DSLR camera is likely to be interested in a different
lens or a tripod.

VI. Penetration Pricing

Penetration pricing is a marketing strategy where a business enters a new product

market with below-average prices. Businesses also use this strategy when they’re
highlighting a new product or service. It works in a simple way, where they set their
prices lower than competitors to lure customers from competitors into their stores.

VII. Price Discrimination

Price discrimination is a tailored approach to pricing where an identical item is sold at

different prices to different buyers. It works on three levels:

23
First degree: Consumers are charged the maximum they’d be willing to pay for any
given product. For example, auction or bidding sites, where one customer might pay lots
more for a similar item, based on what they’re willing to pay. Second degree:
Consumers can choose their price discrimination. For example, they might be offered a
lower price if they buy a product in a higher quantity. Third degree: Products are priced
differently based on customer segments. In essence, it involves taking past and real-
time customer data, segment customers based on that data and then generate prices
specific to each segment.

VIII. Loss leader Pricing

Loss leader pricing strategy involves setting a few products to be sold at a lower price –
a price that actually puts you at a loss – in order to get your customers through the door
(or on your website). Loss leaders hope that once customers are on the website, they’re
more likely to buy your other (normally priced items).

IX. Price Skimming

In its simplest terms, e-commerce price skimming is the art of setting high prices for
your products during an introductory phase. What this means is that businesses are
able to leverage the “newness” of their product and maximize their profits from the get-
go.

What you need to remember about price skimming is there are consumers out there
who want to be the first ones to get hold of a product. They like the feeling of exclusivity.
If you want to implement price skimming, use phrases such as “Exclusive offer” or
“limited availability”, “be the first to get your hands on” within your marketing copy to
make sure you highlight the urgency of the call.

1.6 Prospects and Challenges in the Industry

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In India, there are some hurdles/obstacles which are responsible for the slow expansion
of ecommerce .In 2,2002 Hamilton point out some obstacles in via to e-commerce
including lack of skills problems of security ,cost etc. Customer confrontation to shifting
from real to the virtual store. Until now people do not satisfactorily trust unknown &
paperless transactions. In order to make the country in the line of business, it needs a
focus for the growth of e- commerce in India.

(a) Security Issues

Online payment is a widespread emotional factor for customers in India because they
having fear while making such payments. About 60% of the users do not believe the net
as a proper payment channel. Credit card itself is not secure while using a credit card
for online transactions. They are also not secure when giving the details of the credit
card on online because they are not sure about the salesman identity. Shopper is also
not confident that card is not used for a malevolent purpose which also the cause of big
confronts of e-commerce in banking also.

(b) Customer Acquisition Forces.

There should be a strong successful ecommerce interaction between the markets .One
of the big challenge faced by e- commerce are issues related to lack in delivery ,lack of
supply chain, integration, lack of proper courier high charges for products in some areas
also make customers frustrated. The problem that early stage of ecommerce start-up
will face is to get people to come on e-commerce site & make purchase involves high
costs due to marketing & advertisement.

(c) Product Target.

New companies downpour the marketplace with latest products. Target marketing
becomes one of the most important tools of differentiation. The product which is not
satisfactory for the customer tends to be returned or replaced. Most of the products take

25
much more time in delivery to reach customers home .time delivery of products may
vary from day to month. This is one of the main issues which lead to an overall loss in
revenue, reputation, transportation costs. Mainly the Indian customers possess
great belief problems in e-commerce business transactions.

(d) Less Awareness.

The customers of India are more comfortable in buying / purchasing products while
choosing the product they directly touching the product. About 70% of rural Indians are
unaware of the internet & its uses .it is not admirable one when it comes to an average
of internet users. Only some are aware of the net corruption fraud & this gloom will still
exist .At least 50% of the Indian internet users are unaware of a solution for online
security.

(e) Cash on Delivery.

COD is one of the best ways of payment for the buyers provide by e- commerce
companies. Most of the users denied making the payment at the delivery time of the
product. It is assumed 30-50% of buyers are also taking the benefit of this while buying
any product and service on the internet. It has been introduced that Cod counter the
payment security problems of net transactions but this way has been proving costly to
companies.

1.7 Key Drivers of the Industry

Understanding the leading factors in successful ecommerce can help businesses

deliver better service to customers and gain a clear idea of the right ecommerce KPIs
(Key Performance Indicators) to track. Some of the most important drivers in
ecommerce are:

26
♦ Imperceptible movement from PC to mobile devices to the store. For better
engagement with customers and relevant customer experience, online retail has to
optimize the mobile user experience and be there for the customer during the entire
buying journey.

♦ Omnichannel SaaS solutions for all commercial operations. It’s worth using a single
commerce platform. By adopting only one cloud platform the business can, in the future,
remove the need for system integrations. This also allows for the reduction of
operational costs and gains real-time visibility. Thus the online retail business can
deliver more advanced services faster because of three main factors: scalability,
intricacy, and velocity – which are crucial key drivers of ecommerce.

♦ Implementing personalized promotions based on real-time data. This allows the

business to improve the customer experience and sell more. Targeting offers and
communications reassures clients that only one single version of the truth exists.

♦ A trustworthy website. This should be considered as one of the most important key
drivers of ecommerce. According to research 6 out of 10 online buyers are concerned
about online security. Shoppers need to clearly understand the warranty conditions and
shouldn’t have any doubts about the security of the source. The security certificate
should be displayed on the website.

♦ An intelligent way to track and manage orders inside of the company as well as
physical delivery to clients. Every online retailer should have very clear shipping and
returns policies. 65% of users feel that returning products purchased online is a difficult
process. Also, 61% of customers state that they would abandon a shopping cart if it
didn’t offer free delivery. It is good to have centralized order management across all
channels, real-time inventory and globally connected suppliers and distribution partners.

1.8 Stalwarts in the Industry

E-Commerce stalwarts to converge under one roof at 9th India Digital Summit New
Delhi, Jan 7 (KNN) The 9th India Digital Summit, scheduled to be held here on 14th and

27
15th January will see the presence of e-commerce stalwarts, both national and
international who will gather under one roof to discuss challenges and opportunities in
the industry. Organized by the Internet and Mobile Association of India (IAMAI), the
summit is the largest annual gathering of the digital industry in India where stakeholders
meet to discuss measures and solutions to the challenges, as per official data.

The event that has been traditionally supported by the Department of Information
Technology will also feature presentation of digital awards for mobile, website, digital
social and economic empowerment, payment and advertising.

As far as the agenda is concerned, day one would explore topics such as Challenges of
Non E’s of ecommerce; Mobile Wallet Adoption: How it could transform the Retail
Scenario in India; Travel ecommerce Fuelled: The Next Growth Strategy; The Telco
Cloud: Opportunities and Challenges; Idea, Innovation and Implementation: What it
takes to build a successful Mobile App business in India; Internet of Things: Emerging
Business Models; and Smart Governance: m- Governance.

On the other hand, day two would include the sessions: Mobile Advertising’s Future: A
Turbulent Drive; Change in the Concept of Valuation in the New Digital Age; From
Rs.64 Thousand to Rs.250 million, A Fun Filled Journey of Five Years; Metric that
Matters: Finding The Crux of the Social Media Analytics; and Flash Talks by Cool Start-
ups.

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 CHAPTER – 2

COMPANY/ORGANISATION PROFILE

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2.1 Brief History of the Company

Rajesh Exports Limited is a gold retailer in India which refines, designs, and sells gold
and jewelry. The company ranked 7th on the Fortune India 500 list in 2020, with
revenues of ₹1.96 trillion,[3] and 462nd on the Fortune Global 500. The present
managing director is Prashant Mehta and the executive chairman is Rajesh Mehta.

STRATEGY, MISSION, VALUES OF FLIPKART

The Mission: To “provide their customers a memorable online shopping experience”.

The Vision: To become “Amazon of India”.

Flipkart’s Journey

2011: A Truly Pan - Indian Delivery Network

Flipkart’s steady growth continues, with shopping categories expanding to include

Cameras, Computers, Laptops, Large Appliances, Health, Personal Care, and
Stationery. The platform launches its own digital wallet, as well as a 30-day replacement
policy, and acquires Bollywood content portal Chakpak’s digital catalogue and Mumbai-
based music streaming and digital content platform Mime360. By the end of the year,
Flipkart’s network has expanded to deliveries in over 600 cities across India.

2012: Going Mobile

Flipkart goes mobile in a big way, with the launch of its own native mobile shopping app.
The platform also receives PCI DSS Certification, allowing it to store card details for
consumers securely on the platform, and giving users the ‘Saved Cards’ feature when

30
checking out. Flipkart’s expansion continues at a steady pace with the acquisition of
online electronics retailer Letsbuy, the launch of Fashion, Perfumes, Watches,
Menswear, Toys, Posters, and Baby Care categories, and the debut of two new
services – DigiFlip, a private label for electronics, and Flyte MP3, a service for online
music sales.

2013: Welcome to the Third-Party Marketplace

Flipkart decides to expand its service offerings, adopting a marketplace model to bring
third-party sellers onto the platform. The decision sees an immediate positive response
from the market, and sales rapidly climb – Flipkart manages to sell 100,000 books in a
single day. To allay consumer concerns, the platform introduces Next Day Shipping
Guarantee and also launches PayZippy, an online payments solution for merchants and
customers. In a bid to go global, Flipkart begins accepting international cards for
transactions. A new Woman’s Lifestyle category is introduced, and the company raises
$360 million across two separate funding rounds.

2014: Big Billion Day is here!

2014 is a big year financially for Flipkart, with the acquisition of online fashion retailer
Myntra and majority stakes in after-sales service provider Jeeves and payments
platform Ngpay. The company raises $1.9 billion across three separate rounds and
ends the year with a valuation of $11 billion, also becoming the first Indian Internet retail
firm to register Gross Merchandise Value (GMV) of $1.9 billion. There is a slew of fresh
service launches across the year, including Flipkart First, In-a-Day Guarantee,
Scheduled Delivery, and Same Day Delivery Guarantee. The platform’s first exclusive
associations come into play – with Motorola and Xiaomi – and the company launches a
huge online sale in October – the Big Billion Day. The Big Billion Day would go on to
become one of Flipkart’s most popular offerings.

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2015: Brand Refresh

2015 is mostly business as usual for Flipkart, with several new launches, acquisitions,
and fundraising rounds. Over the course of the year, the platform launches Home and
Maternity product categories, the Ad Platform and Strategic Brands Group in a
corporate rejig, and the data-light mobile website Flipkart Lite. Acquisitions over the
year include mobile advertising company AdIquity, mobile marketing firm Applterate,
and payment services start up FX Mart, as well as an investment in delivery locker
service start up Qikpod. Midway through the year, Flipkart launches a brand refresh with
a new logo and improved progressive policies for employees, including maternity,
paternity and adoption leave policies.

2016: Milestones, Corporate Reshuffle, and more

The year starts with Binny Bansal taking over as CEO of Flipkart from Sachin Bansal,
who becomes the firm’s Executive Chairman. A few months later, TIME magazine
names the two Co-founders among their 100 most-influential people in the world.
Flipkart celebrates two big milestones – the first Indian mobile app to cross 50 million
users and crossing 100 million registered customers. No Cost EMI and Flipkart
Assured, two key new services, make their debut, and the platform also acquires and
relaunches PhonePe, India’s first UPI (Unified Payments Interface) based app which
was started by three former Flipkart employees.

2017: Reaching new heights and Breaking Glass Ceilings

Flipkart breaks tradition by appointing its first-ever non-founding CEO, Kalyan

Krishnamurthy, while Binny Bansal takes over as Group CEO. PhonePe, launched the
previous year, sees rapid adoption thanks to the demonetisation movement, and
crosses 10 million downloads on the Google Play Store. Flipkart raises $1.4 billion from
Tencent, eBay, and Microsoft, and acquires eBay India in exchange for equity – eBay
continues to function as an independent entity. In August 2017, Softbank’s Vision Fund

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invests $1.5 billion in Flipkart to become one of its largest shareholders. Since the start
of 2018, Flipkart has already seen several milestones – a new campus at Embassy
Tech Village, the successful on boarding of over 130,000 third-party sellers, and
expanding its product catalogue to house over 80 million products – culminating in the
Walmart acquisition.

2018:

Walmart acquired 77 per cent stake in Flipkart for US$ 16 billion. Launched fund to
invest in early-stage start-ups to seed innovation in areas related to ecommerce
ecosystem.

2019:

Launched smart assistive feature called Flipkart Saathi launches its online grocery store
‘Supermart’ in Mumbai. Flipkart brings US brand Nautica on board to tap Indian fashion
market.

2.2 Business Process of the organisation – Products

Flipkart started as a book selling website, but later went on to operate as a complete
online retail site. The company started with an inventory based model, but it was in
2013 that it moved to a market place model, which is how even Amazon.com operates.
Flipkart charges a commission of 5-10% on every sale through its site. The commission
charged through luxury items such as electronics is higher than that of generic items.
Flipkart has constantly been trying to reduce the percentage of commission that it
charges to its suppliers, so as to have more number of suppliers. It has also partnered
with brands like Xiaomi who spend on such sites as a strategy to promote their
products. Flipkart also charges third party sellers, where, when a customer searches for
some kind of product, the product relevant to that category or that particular brand will

33
be amongst the first searches to be shown. This is another way companies promote
their products. A listing fee for the sellers is additional revenue for the company, along
with the convenience fee that is usually to be paid by the customers, which includes the
wrapping up of the product as a gift or even the fee for faster delivery.

Payment gateways is another way Flipkart earns its revenue. It is usually the
transaction processing charges which will differ based on the way payment is done. For
example, if a payment is made through debit card and net banking, the charges are
found to be lowest (around 0.75%-1.00% of the transaction amount). Similarly there is
percentage charge levied on even credit cards and American Express cards too. Thus,
depending upon which mode the customer selects to make the payment, the company
gets its transaction revenue, making it another way to earn penny for the company.

Product Portfolio

Flipkart has a wide product portfolio with strategy of expanding it more. In 2015,
Flipkart tied up with three of the country’s largest home retail brands namely- Home
Town belong to the Future Group, HomeStop by Shoppers Stop and @home. With
these tie-ups, Flipkart plans to introduce a new range of products on its website, thus
expanding its product portfolio. Till 2015, Flipkart had about 1000 brands in its portfolio,
which included seven lakh home products. These tie-ups, not only gave a push to
Flipkarts’ growth, but also made it easier for customers to choose from more variety,
and provided them an opportunity to try some of the leading brands in India. Flipkart has
also been planning to partner with a number of retailers across various categories,
making the website a one-stop destination for all kinds of consumers. The company
also believes that aside from the product portfolio, a combination of the distribution of
the products and the latest technology can help enhance the company’s customer base
further.

Flipkart has provided platforms to several brands in all categories to compete with each
other. Through this, it has attempted to attract more customers. Flipkart has also tied up
with many brands wherein the company promotes the products of such brands

34
exclusively. Motorola is one such brand where Flipkart had provided a platform for the
launch of Moto-G and Moto-E. Flipkart also came up with its own personal product
range called as DigiFlip, where it offers products such as gadgets, pen drives,
headphones etc.

Flipkart has targeted itself to be number one in online retailer of furniture. The addition
of home furnishing and automobiles in its product portfolio were some changes that it
has made. By the end of 2016, Flipkart has planned to achieve sales of around Rupees
2600 crore in the furniture segment alone. Such a decision can be a milestone strategy
for the company, as going into the furniture segment at this point of time has been
predicted to be a boom, reaping huge revenues for e-commerce companies.

Some of the product portfolios of Flipkart are: Books, Perfumes, Movies, Games,
Mobiles, Cameras, Computers, Health care and personal products, Home appliances
and Electronics, Stationary, Toys and many more…..

2.3 Customers of the Company/Organisation – Level of Operation

Flipkart, which has redefined shopping in India, works on a B2C (business to consumer
model). Flipkart started off with a direct-to-consumer model selling books and some
other products, before turning to a marketplace model which connect sellers and buyers
and expanding its catalogue. Today, it sells everything from smartphones to clothes to
furniture refrigerators to FMCG goods — and yes, books too.

Flipkart claims to have lakhs of sellers on board from across India who list their products
in over 80 categories. The average consumer might not care who the seller is and has a
relationship with Flipkart, whereas the seller who may not have reached the customer at
all can now do so thanks to Flipkart’s platform. To facilitate this transaction and fulfil the
order, Flipkart charges a varying percentage as a commission fee from the seller.

Flipkart Revenue and Losses:

35
Flipkart earned INR 30,164 Cr in revenue for FY18. The company also multiplied its
losses fivefold reaching INR 46,895 Cr. The major expense which increased the losses
for the year ending March 2018 was finance costs, mostly under “fair value loss on
derivative financial instruments”, which increased nearly tenfold to INR 40,937 Cr in
FY18 from INR 4,309 Cr in FY17.

Flipkart has also recently introduced private labels such as MarQ and SmartBuy, which
sell products in various categories. One of the biggest contributors to Flipkart’s annual
revenue is the customer footfall and activity during its big sales with huge discounts
around festivals such as The Big Billion Day.

In recent months, this discounting has come under the government scanner and this
could impact the company’s revenue in the long-term. Here’s a look at the investments
made by Flipkart Group in the India business over FY 2018-19:

March 2018: INR 4,472 Cr ($686 Mn)

September 2018: INR 3,463 Cr ($486 Mn) December 2018: INR 2,190 Cr ($307.5 Mn)
January 2019: INR 1,431 Cr ($200.8 Mn)

Other Sources of Income for Flipkart:

• Seller Commission: Flipkart charges a commission from the sellers since it provides
a platform for sale for them.

• Convenience Charge: Flipkart charges a convenience fee to the buyers for faster
delivery.

• Logistics: E-Kart is Flipkart’s logistics company and facilitates the fulfilment of orders
from sellers to buyers through its logistics arm. It charges a fee from the sellers for the
same. There is no standard charge levied as it changes according to the geography.

36
• Advertisement: Flipkart sells advertising space to companies on its website. This
offers a leverage to the companies buying the advertising space as they are presented
first to the millions of customers visiting the Flipkart website daily.

• Media Buying: Flipkart releases ads for certain brands in the popular newspapers,
radios, televisions etc. In doing so, Flipkart charges a sum from the brands that it
advertises for.

Flipkart Goes Beyond Ecommerce:

In 2016, Flipkart acquired a fintech company called FxMart and released a payments
service called PhonePe. PhonePe offers a UPI-based payments app as well as support
for billing, recharges, ecommerce and other online services. As per the UPI data
released for August 2019, PhonePe was the leading app for UPI payments
in India. Post the acquisitions by Walmart last year, Flipkart has increasingly turned
to hybrid or Omni channel sales model. It recently opened a FurniSure experience store
to help customers touch and feel the furniture products before making the purchase.
Besides ecommerce, Flipkart has recently acquired a food retail license, which it will
use to run its fresh, locally-produced food retail business under the name FarmerMart.
It’s also selling groceries online through Flipkart SuperMart in some cities.

2.4 Competitors of Flipkart

7 top competitors are:

• Amazon - Amazon is arguably the world’s largest online shopping store. It offers a
wide array of services including online retail, consumer electronics, multimedia content
and computing services among others. It is ranked as the leading online retailer in the
US generating an estimated net sales of close to $140 billion in 2016. A considerable
part of its revenue is generated from the online sale of electronics and other related
goods. It is also one of the most valuable brands in the world with approximately 400

37
million customers with active accounts globally. Amazon also offers its services through
mobile App and digital products like music and videos. It currently has over 370,000
employees worldwide. Amazon is the topmost Flipkart competitor due to its increasing
market share.

• Snapdeal - Snapdeal is another Indian based e-commerce company that offers online
retail services. It was founded in 2010 but has risen to become one of the biggest e-
retailers in India. It serves a significant number of sellers and consumers of different
products from different location all over the country. It has a broader assortment of
products estimated to be over 35 million obtained from more than 125,000 retailers and
brands, both local and international.

• Alibaba - Alibaba is another giant company that offers online commerce services. It
was founded in 1999 as a simple B2B online shopping portal but later grew to become
the biggest ecommerce portal in Asia offering B2B, C2C, and B2C online services. The
total revenue that this company generated in 2017 Financial is estimated to be around
158.3 bn RMB, an equivalent of over $24 billion.

• Paytm - Paytm is an Indian-based online payment and e-commerce Company that

offers allows the users to make payments upon purchase of a wide range of products
including fashion items, electronics, home appliances and digital products among many
more. Paytm is an abbreviation for Payment through mobile has over 13,000 employees
working in different divisions hence making the user experience fast, secure and
efficient.

• Myntra - Myntra is a part of Flipkart but is a competitor of the online portal where
fashion is concerned. Myntra is an Indian-based online marketplace for a wide range of
fashion items. It was founded in 2007 with the primary aim of customizing different types
of gift items, especially that are related to fashion. Later on in about three years Myntra
chose to shift focus and started to sell branded apparels.

• Jabong - Jabong too was purchased by Flipkart and is an online competitor to the
fashion segment of Flipkart. Jabong is also an Indian-based company that provides e-
retailing services. It specializes in selling fashion items including footwear, trousers,

38
shirts, dresses and a many more. Jabong provides fashion products for children, men,
and women thus making it easy for shoppers to do family shopping all at once.

• Shopclues - Shopclues is an online platform that offers consumers with the

opportunity to shop and make payments for different types of products. It was founded
in 2011, but it has improved its services and brand visibility to become among the highly
regarded online marketplaces in India. It deals explicitly with home appliances, kitchen
wares, electronics and fashion products that are owned by local and regional brands.

• Focused online stores - There are many stores which are focused on a single
strategy which are direct Flipkart competitors. Some of them include the likes of Industry
buying (industrial material) or homeshop18 (home appliances). Such focused online
stores take away the market share of such products from the massive online portals like
Flipkart. Although they are small in size, the focused approach helps in turnover for
these portals.

2.5 Strategies – Business, Pricing, Management

 Business Strategy

Flipkart is set out to create something for the Indian market – a service that was
specifically built keeping the Indian consumer in mind. For them, the biggest inspiration
continues to be the constant learning process that has been a part of their journey. The
other has been the ability to realize our dream of doing something for the Indian
consumer. As far as entrepreneurship is concerned, Flipkart believes that the core focus
for every start-up, regardless of the industry, should be the same – and that is customer
focus. By putting the needs of their customer first and listening to what they have to say,
is the only route to building a large, loyal customer base – the blueprint to any business
success story.

Consistent customer service is the hallmark of Flipkart. Discounts cannot replace the
customer’s satisfaction of being serviced promptly and efficiently. Similarly, the trust-
building exercise is accorded a lot of importance. Flipkart connects with customers in

39
real-time, through Facebook and Twitter. Honesty is the best policy for this e-
commerce trailblazer. Flipkart is rapidly expanding its network of warehouses,
distribution centres, procurement operations and 24/7 customer support teams. The
company has its own delivery network in 37 cities and is set to expand this in the
current financial year. With a team of around 4,800 members, the company operates
from offices and warehouses in seven Indian cities.

It is very difficult to sell a product which has been offered intentionally high to a middle
customer in India. But then the customer is getting that offer at the comfort of their
home. Any customer will like this and will pay the amount tagged by retailer. But how
can this idea are promoted. Flipkart used Word of Mouth as their best marketing tool to
sell their product. A satisfied customer tells others also about a good experience, and
this how the business of Flipkart depends. Flipkart has been using different Social
Networking Engines to promote their product. Promotions on Facebook, twitter and
other social sites helps in gaining some attention, but to some extent, the rest has been
done by Services offered by Customer. Customer satisfaction has been their best
marketing medium. Flipkart very wisely used SEO (Search Engine Optimization) and
Google Ad-words as the marketing tools to have a far reach in the online world.
Flipkart.com official Face book page has close to 9 lac ‘likes’. Flipkart recently launched
a series of 3 ads with the tag line – “No Kidding No worries”. Kids were used to create
the adverts to send out the message – if a kid can do it, you can also do it. The
message is very clear to make people more comfortable with Flipkart, to generate a
great customer relationship and loyalty on the basis of great product prices and
excellent customer service. All in all to create a great customer experience.

 Pricing Strategy

1. Operating Margins – Essentially determining what the company earns to sustain

business and turn a profit.

2. Strategic pricing – Basically overall pricing strategy where some products are given at
a higher discount in order to capture market share or consumer mindshare.

40
So individual product pricing can be higher or lower while the overall picture is kept in
mind so that the company as a whole can sustain itself on an overall profits or deep
enough pockets to work on losses for sometimes.

Price is optimized best when the overall cost to the company per product is optimized.
So that means here the contributing factors have to be looked at and the costing there
has to be optimized. So looking at the major cost factors that affect the E-Commerce
that are taken care of Flipkart:

1. Supply Chain (Procurement and Shipping):

Flipchart’s core competency lies in their Supply chain and logistics which has been
perfectly monitored and managed by professionals. This involves a deep understanding
of where the suppliers are and where the end consumers are so that when a customer
orders a product, it can reach him by the shortest route in the shortest time and
minimum manpower time being spent.

This also means that customer demand is anticipated and pre-emptive steps are taken
so that products are ready to be shipped from the point closest to the consumer before
he even places the order. This helps in reducing the overall cost of moving the product
to consumer’s place. The overall cost of Flipkart has been reduced to great extent, all
thanks to Blue Dart, the logistics partner of Flipkart. It is so because the transportation
cost has been reduced and therefore Flipkart is able to earn a reasonable margin on the
sale of product, belongs to the actual producer.

2. Manpower and Time spent on each order:

We must understand that all operations have to be made sustainable and more
importantly scalable for ultimate long term growth. So all process from what route a
person takes to pick up material to how much time it takes to pack a product have to be

41
looked at and it is when a company works toward optimizing all these processes that a
company really starts to take the lead.

 Management Strategy

Flipkart began operations on the consignment model – goods were procured from
suppliers on demand, based on the orders received through the website. However,
eventually, the books-to-electronics e-shop adopted the warehouse model. The
company has its own warehouses, and maintains its own inventory. Sales projection
determines the inventory, and the available inventory accounts for the sales made; it’s a
self-feeding cycle of sorts. Nearly 60 to 70 per cent of deliveries take place through their
own network as this model provides for better control over the entire logistics
management piece.

On the operational front, issues faced by the company pertain to delay in deliveries, or
faulty products. As a customer-centric, none of these issues can remain unresolved for
long. They faced significant challenges in reverse logistics. It’s a big task to track
unsuccessful orders, which are quite costly to manage. Hence, Flipkart stresses on
customer service – it aligns with the firm’s philosophy of making better our service
promise’. Their bigger objective is to redefine the way India shops. Flipkart will continue
to expand our categories in order to meet the growing consumer interest in the e-
commerce market. They have recently added computer peripherals, kitchen appliances,
televisions and home theatre systems and selected stationery items to their product
range. They will continue to add more products / selection to their existing categories as
well.

Flipkart went for a major brand makeover, making it look more ‘up market’. There have
been large newspaper ads, TVCs and a lot of web ads. But unlike other ecommerce
companies the inorganic marketing kicked in only when the product was strong. Flipkart
already had a proven model execution with books and extending to other verticals did
not need infrastructural changes. Flipkart’s real achievement has been in solving the

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pain points in Indian ecommerce that most well-funded players are still complaining
about.

“No Kidding, No Worries”

No Kidding, No Worries, the recent advertising and branding campaign of Flipkart is a

unique example of “Trap Them Young”. An in-depth analysis of recent advertisement
campaign of Flipkart strongly conveys Indian youth’s sentiments and their desire. The
story board of adverts, features kids in adult situations, like a beauty parlour, a cafe, and
an office. The Hinglish language & the happening places is the heart of No Kidding, No
Worries advertisement series. The creative director succeeds to keep KOOLNESS of
Brand Flipkart.

Flipkart attacks the Online Fears:

Flipkart carefully chooses their way forward. For now, Flipkart seems to be playing their
cards right. Flipkart.com has aired three TVCs. Each of the ads attacks a distinct fear in
the consumer’s mind towards online shopping, and how Flipkart solves that problem;

 Fear of wrong product – 30 day replacement guarantee

 Fear of giving credit card details online – Cash on Delivery feature
 Fear of not getting the original product – Original products with original warrantee

The creative using kids to break through the clutter, and the consumer worry and the
solution offered by Flipkart is clearly communicated. The brand ‘Flipkart.com’ at the end
is also very clear to be missed, which gives the branded breakthrough.

30 Days Replacement Guarantee:

Flipkart.com offers you REPLACEMENT WITHIN 30 DAYS FROM THE DATE OF

DELIVERY ON THE product/s ordered on Flipkart.com i.e. if at the time of delivery

43
and/or within 30 days from the date of delivery of the product/s, if any defect is found,
then the buyer of the product/s can ask for replacement of the product/s subject to some
terms and conditions.

Order Cancellation:

Cancellation of orders of products is permitted before the product gets shipped and the
entire payment amount is refundable. But products such e-Gift Vouchers, Wallet Top-
Ups, etc. are non-refundable.

Free Shipping:

Flipkart provides free delivery on all items if your total order amount is Rs.300/- or more.
Otherwise Rs.30/- is charged as delivery charges.

2.6 CSR Activities

Flipkart’s growth over the last decade wouldn’t have been possible without the support
of Indians who believed in the power of e-commerce to transform their lives. In the past,
Flipsters have volunteered and engaged in social work in their individual and collective
capacities. However, with Flipkart turning 10, it was decided that our Corporate Social
Responsibility (CSR) activities should acquire focus and direction, aligning with our
“Flipkart for India” mission. To contribute to the effort as an organization and to give
back to India, Flipkart has initiated its CSR program during the Month of Giving, which is
part of the #FlipkartBIG10 celebration that has marked our tenth year. Over the years,
Flipkart has developed tools and resources, which will be deployed to help people in
need through the official CSR program, Flipkart Cares.

Flipkart Cares aims to support those in need and contribute to their sustenance to help
build a promising future for them. Besides donation drives, outreach programs, and
employee-enabled on-ground initiatives, Flipkart Cares will encompass the larger
ecosystem of customers and sellers to participate in various initiatives to make a
difference. Some specialities of Flipkart Cares are;

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• TOYS FOR A SMILE – How you helped make this children’s day extra special.

• Flipkart and Walmart Foundation pledge Rs.460 million to support Indian’s fight back
against COVID-19.

• WORKING MIRACLES: Flipsters chip in for an unconventional Mother’s Day Gift.

Etc………

HOW FLIPSTERS HAVE MADE AN IMPACT

In the past, Flipkart employees have mobilized time, effort and resources to raise relief
funds for people in disaster-struck areas. In 2016, Flipkart assisted Goonj, an NGO, to
aid the victims of severe flooding in Assam. Flipsters contributed generously with cash
donations and a matching donation from Flipkart aided the relief efforts.
In 2015, when Chennai experienced heavy flooding, many Flipsters donated money
from their payrolls while Flipkart donated over 6,500 units of essential items from its
inventory. Flipkart’s partner in the effort, Goonj, ensured that the supplies were
delivered to the affected people in Chennai promptly. Over 200 Flipsters have been
working towards making a difference in the lives of children with disabilities. In 2016,
their ‘Secret Santa’ program spread Christmas cheer among the children at
Samarthanam Trust for the Disabled in Bengaluru. Donning Santa hats, Flipsters
distributed toys and books, and played cricket with the children, and were rewarded with
bright smiles. Flipkart Cares aims to streamline such efforts and rally Flipsters to make
a larger impact. Flipkart donated more than 6,500 units of essential items from its
inventory to the 2015 Chennai flood victims. In November 2017, volunteers from Flipkart
visited a Government school in Bengaluru suburbs to spend a day with the students and
help make the school campus, often vandalized and misused, conducive to learning.
From November 7 to November 14, 2018, whenever a customer bought a toy on
Flipkart, one similar was kept aside to be gifted to the children at Karnataka
Government School.

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Giving has always been encouraged at Flipkart, and CSR efforts have existed in
pockets across the organization until now. Flipkart Cares will be a concerted, tech-
enabled effort driven by Flipsters and in partnership with our customers, and we’re all
going to make a difference where it matters, in our own special way. – Binny Bansal,
Group CEO – Flipkart.

BRIDGING THE GAP WITH FLIPKART CARES

Our country is a vast and diverse land and its people, even more so. Home to many
cultures, beliefs and traditions, India boasts unity among people of many cultures and
creeds. But like any developing country, we have issues that demand attention and aid.
Our upcoming initiatives focus on solving one of the many problems faced by artisans
and craftsmen who live and work out of remote locations in our country. – Direct
customer access. Some of India’s most beautiful craftsmanship exists in such remote
areas of the country and most of the work and art goes unrecognized or largely
exploited. The Bridge the Gap program strives to help bottom-of-the-pyramid artisans
and craftsmen get their products into the market.

Flipkart Cares aims to use Flipkart’s proven tools and technological resources to aid
those in need and contribute towards a better India. Change cannot happen overnight,
but with continued effort, Flipkart Cares, backed by eager Flipsters and customers,
hopes to drive change that benefits those who need it the most.

2.7 Collaboration & Expansion Plans

 Collaborations

• Myntra: Flipkart acquired fashion e-commerce company Myntra in the year 2014. The
price of the deal was $300 million.

• FX Mart: In September 2015, Flipkart acquired FX Mart, a payment services company

for $6.80 million.

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• PhonePe: In 2016, Flipkart acquired PhonePe, one of India’s largest UPI based
payments start up.

• Jabong: Flipkart acquired Jabong through Myntra in the year 2016, for a price of
approximately $70 million from the Global Fashion Group.

• EBay India: Flipkart completed its merger with eBay in 2017. For the purpose, eBay
made a cash investment of $500 million in exchange for an equity stake in Flipkart and
sold its eBay.in business to Flipkart.

• Liv.ai: Liv.ai, an artificial intelligence (AI) start-up which has built a platform that
converts speech to text in 10 Indian languages, was acquired by Flipkart in 2018.

• Upstream Commerce: An Israel-based analytics start-up called Upstream Commerce

was acquired by Flipkart in 2018 so as to assist its seller base with services such as
real-time pricing and information on product assortment.

 Expansion Plans

Flipkart plans expansion, bolsters logistics before festive sales. In the run-up to the
festive season, e-commerce major Flipkart is planning to expand its reach to tier-III
cities across the country. The Walmart-owned online marketplace has massively
expanded its reach of its pick-up operations in more than 800 additional cities and
towns over the past six months.

The company has taken massive logistic operations to bring in thousands of new
sellers, MSMEs, domestic manufacturers, and artisans into the e-commerce fold.
According to the company, the expanded base is going to help more than 60,000 sellers
from Uttar Pradesh, Bihar, Tamil Nadu, Telangana, Jammu and Kashmir, Assam, and
Tripura.

47
 The Reach Project by Flipkart was initiated in February to rapidly scale up pick- up
capabilities and to cater to seller requests in unserviceable areas of the country. In total,
the new PIN code additions represent an about 40 per cent increase in serviceable
cities across the country. In tier-III cities and towns, The Reach Project has increased
operations in serviceable PIN codes by 50 per cent. “Flipkart’s initiative to increase the
number of serviceable PIN codes for pick- up is a reiteration of our commitment to
democratise e-commerce and spread the benefits of our platform to sellers, MSMEs
and artisans outside metro cities. We are working to empower more small-and-medium-
size businesses, to bring their products to pan-Indian customers comprising 150
million,” Kalyan Krishnamurthy, CEO, Flipkart Group, said. This festive season, the
company said, would be the biggest ever for Flipkart and the ecosystem.

“We are making a concerted effort to ensure that MSMEs, sellers, rural entrepreneurs,
artisans, and weavers are able to participate, capitalise, grow and prosper through the
opportunities afforded by e-commerce and celebrate with the country as a whole,”
Kalyan Krishnamurthy said.

According to reports, the company is planning to double its sales numbers during the
festive season compared to last year. It is also considering hosting a slew of launches in
the mobile phone, electronics, fashion and other segments. The company has a
registered customer base of over 150 million, offering over 80 million products across
80 plus categories. Together with Myntra and Jabong, which hold prominent positions in
the online fashion market and PhonePe, it has one of the largest consumer bases
among Indian e-commerce players.

2.8 SWOT Analysis

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 Strengths: Weaknesses:
1. Strong Brand value. 1. Lack of independent board.
2. Own Logistics Arm e kart 2. Secretive and Political Culture.

3. Own Online payment 3. Excessive focus on

gateway solution Payzippy. expanding customer base rather
4. Own Market place model. than pulling profits.
5. Advertisements and
Promotions
6 Strategic Acquisitions
Opportunities:
Threats:
1. Online fashion and apparel
1. From competitors like
business.
Amazon, Snapdeal, Infibeam,
2. Providing logistics services
Indiaplaza, Homeshop18 etc.
to its competitors.
2. Customer loyalty.
3. Rural Market.
3. Government Guidelines.
4. Mobile apps.

 Strengths:

• Flipkart is a company which entered online E-Commerce industry very early. It has
strong brand value in India.

• Flipkart has developed its own logistics arm E-Kart, which has been initially used for
in-house deliveries.

• Recently, it has developed its own payment gateway solution provider, where
customers can save their credit card details, Payzippy.

• Flipkart has its own marketplace model where sellers need to register in this platform
and buyers can negotiate with the sellers on varied service levels and it also helps
company to reduce its own inventory. Flipkart will just deliver those products.

49
 Weaknesses:

• Most of the money has been invested by Venture firms like Tiger global and Accel
Partners. SO, most of the decisions that are taken by founders of firm have to been
approved by Investors.

• Secretive and political culture is followed in this company while they are recruiting
which is creating problems in this company.

• Flipkart is excessively focusing on expanding customer base rather than pulling profits
in the process having cash burn.

 Opportunities:

Flipkart can venture into online apparel and fashion business, where the gross margins
are higher. Flipkart can offer its logistics services to its competitors in online retail sector
with its logistics arm E-kart. With online commerce sector going to boom in the coming
years, online transactions are going to increase. So, if Flipkart offers its logistics
services to its competitors, it can gain money from those transactions.

 Threats:

Flipkart is facing a lot of competition from some of the online retailers like Amazon,
Snapdeal, Indiaplaza, and Homeshop18 etc. which is affecting its customer base.
Government guidelines on the issues identified with FDI in multi marking retail have
been a major obstacle in the accomplishment of the E-business industry in India.

50
 Chapter 3

Industry Analysis

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3.1 Porter’s 5 Forces Model

Porter's Five Forces is a model that identifies and analyses five competitive forces that
shape every industry and helps determine an industry's weaknesses and strengths. Five
Forces analysis is frequently used to identify an industry's structure to determine
corporate strategy. Porter's model can be applied to any segment of the economy to
understand the level of competition within the industry and enhance a company's long-
term profitability. The Five Forces model is named after Harvard Business School
professor, Michael E. Porter. Porter's Five Forces is a business analysis model that
helps to explain why various industries are able to sustain different levels of profitability.
The model was published in Michael E. Porter's book, "Competitive Strategy:
Techniques for Analysing Industries and Competitors" in 1980. The Five Forces model
is widely used to analyse the industry structure of a company as well as its corporate
strategy. Porter identified five undeniable forces that play a part in shaping every market
and industry in the world, with some caveats. The five forces are frequently used to
measure competition intensity, attractiveness, and profitability of an industry or market.

• Porter's Five Forces is a framework for analysing a company's competitive

environment.

• The number and power of a company's competitive rivals, potential new market
entrants, suppliers, customers, and substitute products influence a company's
profitability.

• Five Forces analysis can be used to guide business strategy to increase competitive
advantage.

The Ecommerce industry has flourished at an impressive rate during the last few years.
The reasons include growing economic activity around the world and the growth of
technology. Both these factors have an important influence on the growth of the e-retail
industry. Particularly, it is in the US and Asia Pacific where the rate of growth is
expected to remain the highest in the near future. Some of the major players in the
industry include Amazon, Ali-Baba, E-bay and Flipkart. Apart from it Walmart and
Costco have also made their foray into e-retail.

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Moreover, the growing use of mobile technology has also proved favourable for the
industry and led to an increase in revenue and profits.

With new local and global players entering the industry, the level of competition has also
grown. The major global players like Amazon and E-bay have made significant
investments in technology to provide their customers with a personalized shopping
experience. This is a Porter’s Five Force analysis of the Ecommerce industry. The
Porter’s five forces model deals with the factors that affect an industry’s attractiveness
and competitiveness. These five forces are there in every market and industry and
determine its attractiveness.

Porter's five forces are:

 Bargaining Power of Suppliers

In the Ecommerce Industry, the bargaining power of the suppliers is generally low to
moderate. The reason is that the rules are set by the brand and the suppliers have to

53
follow the code of conduct set by them. Most of the ecommerce brands are highly
cautious regarding their supplier relationships and set a code of conduct related to
quality, labor and wages as well as sustainability. Despite the number of players in the
industry having grown, the suppliers do not have too many options and therefore are
bound by the rules that the brands have set. It is why the Ecommerce brands have the
upper hand and the bargaining power of the suppliers is low. Some of the suppliers may
have some bargaining power because of their size and quality.

In this Industry, suppliers are the producers of finished products like Apple, Dell, Nike,
etc. Online retail companies sell different products ranging from computer accessories
to cosmetic’s to apparels to clothes. Since there are many producers for any specific
category, they cannot show their energy on online retail companies. For example, if you
see the computers category, there are many producers like Apple, Lenovo, Toshiba and
Dell, who desires to sell their products using these online retail companies. So, they will
not be having the ability to operate the online retail companies. Online customers can
choose the products and the changing costs in this scenario are zero. It is hard for
manufacturers of finished products to come into industry because of challenges in
Logistics. Online retail industry is important to producers because it plays as one of the
medium to sell the products. Now, most of the customers are purchasing online through
online companies, they can’t risk to lose this medium. So, they can’t state their terms
with online retail companies. So, in this industry the producer’s power is low.

 Bargaining Power of the Buyers:

The bargaining power of the buyers is moderately high in the ecommerce industry. It is
because several small and big brands ha e cropped up and there is hardly any
switching cost for the customers. Today’s customer is well informed and has every
piece of information available at a single click. Apart from it some of the physical retail
brands have also entered the commerce market and the physical retail market itself
adds to pressures. Most of the brands are trying very hard to retain every customer and
for this purpose they make very large investments in technology and customer service.

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Due to all these factors the bargaining power of the buyers is moderately high the
factors that can moderate their bargaining power include brand image, quality of
products and service and prices.

Purchasers in this industry are clients who purchase the items on the web. Since this
industry is in flood of numerous players, clients are having part of choices to choose the
things. Changing expenses are likewise less for purchasers since they can without
much of a stretch change benefit from one online organization to other one. Same items
will be shown in a few online retail sites. In this way, item separation is low. In this way,
every one of these elements make clients to have more power when contrasted with
online retail organizations.

 Threat of Substitute Products:

Substitute for this industry starting at now is physical stores. Their danger is low for this
industry since clients are going for online buys as opposed to going to physical stores
as it will spare time, exertion, and cash. With the coming and infiltration of web and
advanced mobile phones, future in retail has a place with online retail. When we think
about relative quality, relative cost of item that he/she purchases online with physical
store, both are practically same and now and again, online rebates will be accessible
which makes clients to purchase items on the web. There two main threats in terms of
substitutes for the Ecommerce brands. The first are the competing e-retail businesses
and the second are the physical retailers. Brands try to earn a competitive advantage
through low prices, better quality of products or through a better overall customer
experience. For the customers there are no switching costs and they can easily switch
from one e-retailer to another or from ecommerce to physical retail.

 Threat of New Entrants:

Threat of new participants is high in this online retail industry in view of taking after
reasons:

55
• Indian government will permit 51% FDI in multi-mark online retail and 100% FDI in
single brand online retail at some point or another. Along these lines, this implies
outside organizations can come and begin their own online retail organizations.

• There are less boundaries to passage like less measure of cash required to begin a
business, less measure of framework required to begin business. All you need is to tie
up with providers of items and you have to build up a site to show items so clients can
arrange items, and a tie up with online instalment portal supplier like bill work area.

• Industry is additionally going to develop at a fast rate. It will touch 76 billion $ by 2021.
Industry will encounter an exponential development rate. Along these lines, clearly
nobody needs to miss this huge open door.

 Rivalry in the Industry:

The level of rivalry in the industry is high because of the large number of players. The
number of local and global brands in the ecommerce market has grown and this has
also led to higher competition. Apart from Amazon, Ebay, and Alibaba, there are several
other local brands like Flipkart, Coles etc along with some of the retail brands like
Walmart and Costco. So, the overall rivalry between these brands gets to be very high.

Flipkart is facing a lot of competition from many online retailers like Snapdeal, Amazon,
Homeshop18, Indiaplaza and many more. Flipkart is working in online retail industry.
Online retail industries worth’s 1.4-1.6 billion dollars. According to a recent TechnoPak
report, e-tailing has the abilities to grow in more than hundred-fold in upcoming 9 years
and to reach $76 billion approximate in 2021. This growth will be increased by the
country’s growing Internet users, which will may be comprising 180 million broadband
users approximate 2020, and a rapidly increasing class of Internet users. In few years,
Indian online retail industry will grow to approximately 10 billion dollars. Some of the
major challenges faced by online retailers are education, trust and customer loyalty.
Many customers like Cash on Delivery option in place of credit/debit card payment.

56
Chapter 4

Discussion

57
4.1 Objective Assessment – observation by the candidate about the
Organisation

Observation about Flipkart Pvt ltd :

Founded by Sachin Bansal and Binny Bansal in October 2007, Flipkart Private Limited
is the largest e-commerce company in India. Based in Bengaluru, India, Flipkart has a
registered customer base of over 100 million people, offering over 80 million products
across 80+ categories ranging from smartphone and fashion to books and furniture.
Flipkart is well known for its astonishing services like Cash on Delivery, No Cost EMI
and 10-days Replacement Policy.

Flipkart has redefined the way brands and Micro, Small and Medium Enterprises
(MSMEs) do business online and has registered over 100,000+ sellers. Flipkart also
offers services such as In-a-Day Guarantee across 50 cities and Same-Day-Guarantee
across 13 cities.

Flipkart, with its innovative marketing strategies and strong customer-support teams has
acquired a major share in the Indian e-commerce market. Flipkart minimizes its cost by
using its in-house logistics and also third party logistics which has played an important
part in the success of the company. The ban of Foreign Direct investment (FDI) by India
in online retailing, Flipkart has created many inter-connected independent entities
through which it raises massive amounts of money which they use to build an integrated
e-commerce business. With the entry of entry of base and also add new customers. The
existing marketing strategies adopted by Flipkart have proved to be fruitful for the
company with Flipkart having almost 44% of the total market-share.

Flipkart is known for:

• Innovative Cash on Delivery service and our 30-day replacement policy.

58
• Giving the convenience of a website infused with the experience of a new players,
both domestic and foreign, in the Indian e-commerce sector, Flipkart now needs to
adopt innovative marketing strategies to retain its existing customer native app through
an intuitive Flipkart Lite app.

• Guaranteeing a 6 level quality check at every stage from storage to packaging. Flipkart
Assured badge assures 2-4 day delivery across India.

• Big Billion Days Sale, which is regarded as India’s biggest shopping sale. As a
testament to our path-breaking work and focus on employees.

• Flipkart has been awarded "The most sought-after workplace in India" by LinkedIn,
according to their 2017 Top Companies list for India.

• Flipkart's Android app arrived the 4.5 rating score on the Play Store matching the
powerful rare apps worldwide to have this flair of holding 100M+ app downloads and an
app rating of 4.5 on the Play Store.

Culture and Values:

The work culture at Flipkart is a work-life-fine-tuned, open and transparent culture which
the employees have come to love over the period of time. The employees at Flipkart get
a chance to pose questions to their business leaders or even the top management
through events such as Flip-out-Friday, a weekly forum for Flipsters (what Flipkart
employees call themselves). The openness at Flipkart doesn't only empower its
employees to think of solutions but also gives them the liberty to implement them.
Employees are encouraged to take responsibility for their actions and decisions and
learn from their mistakes. People at Flipkart are always motivated to think out of the box
solutions even if they carry a fair amount of risks. Innovation is a priority and the input of
every employee-whether at a senior level or at a junior level- counts. To sum up, the
culture at Flipkart offers a larger-than-life experience at the workplace.

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4.2 Specific Learning Outcome

• Flipkart, currently the giant, stepped into the e-commerce industry as a player when
the industry was in its nascent stage. Flipkart has truly been an iconic contributor in
making the ecommerce industry the fastest growing industry in the country.

• With a mere investment of Rupees four lakhs, Flipkart started as an online book store.
With wide acceptance from the people in the country, the company grew bigger and
diversified into products like electronic goods, apparels, e-books and other home and
life style products.

• It was Flipkart which came up with the idea of Cash on Delivery (COD) when people
were reluctant to make online payments through payment gateways.

• Timely delivery of the product was also considered an important aspect for the
success of any e-commerce site. Flipkart ensured this by coming up with its own supply
chain management system.

• The quality of service provided, the wide range of products, and the pre and post sales
experience provided, is what sets Flipkart apart from all of its competitors.

• Flipkart charges a commission of 5-10% on every sale through its site. The
commission charged through luxury items such as electronics is higher than that of
generic items. Flipkart has constantly been trying to reduce the percentage of
commission that it charges to its suppliers, so as to have more number of suppliers.

• Flipkart also charges third party sellers, where, when a customer searches for some
kind of product, the product relevant to that category or that particular brand will be
amongst the first searches to be shown. This is another way companies promote their
products.

• Flipkart has also set up “Pick up Stores” in various cities which provide convenience to
the consumers to pick up their orders as per their convenience.

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• Flipkart, being a giant, was never too hesitant in acquiring a number of smaller
companies so as to maintain its market share, e.g.: Myntra.com, a Letsbuy.com,
phonepay etc.

• Flipkart has changed the way a company promotes itself. It largely depends on word-
of-mouth promotion, where the satisfied customers provide feedback and enable other
customer purchases.

• Flipkart also connects with its customers on social media sites such as Twitter wherein
they answer all issues raised by the customers, and also evaluate all the suggestions
given by the customers and implement them.

• Flipkart has come up with varieties of themes for advertising their products. Their tag
line “No kidding No worries” signifies the comfort and the convenience that the company
aims to provide to its customers. Another eye catching tagline “Shopping ka naya
address” helped the company promote itself as a better alternative shopping experience
to its target customers.

• The exclusive phone application by Flipkart has also been a tool in promoting itself, by
giving latest alerts about the discounts, recent product launches, current offers, and
various coupons and vouchers.

• Flipkart introduced Flipkart Assured, with also guarantees free delivery in few days.
This aside, Flipkart Assured also promises quality products by conducting quality
checks at least 6 times.

• The company’s logistics abilities is probably the primary key or the game changer
which has helped it evolve over time.

• Flipkart very wisely used SEO (Search Engine Optimization) & Google Ad-words as
the marketing tools to have a far reach in the online world. All in all to create a great
customer experience.

• Brand Awareness are key success factor in the market. Flipkart is the industry leading
with 80% market share having a very high Brand Awareness and lowest price.

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• The main objective of Flipkart is to highlight the convenience of e- commerce to
traditional offline shoppers and thus provide its customers with good value and it wants
to be regarded as one of the most friendly service providers in the domain and help
grow the market.

• Their main aim is diversification of products portfolio and stronger supply chain
management.

• CSR activities of Flipkart are carried out by Flipkart Care, with the aim to use Flipkart’s
proven tools and technological resources to aid those in need and contribute towards a
better India.

• Flipkart employees calls themselves as ‘FLIPSTERS’.

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 Chapter 5

Findings - Summary Of Findings - Critical Observation About The

Industry And Organization

63
Findings about E-Commerce Industry

• The Electronic Commerce, or e-commerce, industry is one of the most progressive

sectors of the economy. It has transformed the way business is done in India.

• E-commerce or ecommerce, is trading in products or services using computer

networks, such as the Internet. Electronic commerce draws on technologies such as
mobile commerce electronic, supply chain management, internet marketing, online
transaction processing, electronic data interchange (EDI), inventory management
systems, and automated data collection systems. Modern electronic commerce typically
uses the World Wide Web for at least one part of the transaction's life cycle, although it
may also use other technologies such as e-mail.

• E-commerce is the sale or purchase of goods or services conducted over computer

networks by methods specifically designed for the purpose of receiving or placing of
orders. Even though goods or services are ordered electronically, the payment and the
ultimate delivery of the goods or services do not have to be conducted online.

• Some benefits of e-commerce are; Improve Productivity, Better Customer Service,

Convenience, Reduced Errors, Unlimited Shelf Space, Increased Global Presence etc.

• Major challenges faced by E-commerce in Indian are; Poor knowledge and

Awareness, Online Transaction, Cash On Delivery, Online Security, Tax Structure,
Touch and Feel factor etc. Although, major portion of e- business sector have affected
by these challenges but still there are few online giants like Makemytrip.com,
Flipkart.com, Snapdeal.com etc. who have overcome these challenges and represent
the perfect growth trend of ecommerce in India.

• The various types of e-commerce are; Business-to-business(B2B), Business-to-

consumer (B2C), Business-to-employee (B2E), Business-to-government(B2G),
Consumer-to-business(C2B), Consumer-to-consumer(C2C), Government-to-Business
(G2B),Government-to-Citizen (G2C), Government-to-employees (G2E), Government-to-
Government (G2G) etc.

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• The key factors for growth e-commerce in India are; Customer convenience,
Replacement guarantee, Reach, Multiple payment option, Price comparison, Shipment
option, Logistical challenges, Quick Service, Quality, Customer care centre etc.

• Indian e-commerce industry is expected to spend an additional $500- $1,000 million

on infrastructure, logistics and warehousing, leading to a cumulative spend of $950-
$1900 million till 2017-2020, according to an ASSOCHAM-PWC joint study.

• Major E-Commerce companies in India are; Flipkart, Amazon, Snapdeal, Jabong,

Myntra, eBay, naaptol, Shopclues, Homeshop18 etc.

• The Indian e-commerce market is expected to grow to US$ 200 billion by 2026 from
US$ 38.5 billion as of 2017. Much growth of the industry has been triggered by
increasing internet and smartphone penetration.

• The ongoing digital transformation in the country is expected to increase India’s total
internet user base to 829 million by 2021 from 636.73 million in FY19.

• India’s internet economy is expected to double from US$ 125 billion as of April 2017 to
US$ 250 billion by 2020, majorly backed by ecommerce.

• India’s E-commerce revenue is expected to jump from US$ 39 billion in 2017 to US$
120 billion in 2020, growing at an annual rate of 51 per cent, the highest in the world.

• The Indian e-commerce industry has been on an upward growth trajectory and is
expected to surpass the US to become the second largest e-commerce market in the
world by 2034. Technology enabled innovations like digital payments, hyper-local
logistics, analytics driven customer engagement and digital advertisements will likely
support the growth in the sector.

• The growth in e-commerce sector will also boost employment, increase revenues from
export, increase tax collection by ex-chequers, and provide better products and services
to customers in the long-term.

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• Excellent user experience on the e-commerce website in term of usability speed clarity
will enhance the loyalty of existing customer and move a step ahead of brand
awareness towards customer retention.

• Ecommerce has a great deal of advantages over "brick and mortar" stores and mail
order catalogues. Consumers can easily search through a large database of products
and Consumer preferences on online marketing with reference to Flipkart services.
They can see actual prices, build an order over several days and email it as a "wish list"
hoping that someone will pay for their selected goods. Customers can compare prices
with a click of the mouse and buy the selected product at best prices.

• E-retail market is expected to continue its strong growth, by registering a CAGR of

over 35 per cent and to reach Rs.1.8 trillion (US$ 25.75 billion) by FY20.

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 Conclusion

Internships are more than just a summer job or a "semester job" with a pay check.
Summer internship is a way through which they gain an insight into the real corporate
world and how things function there. Therefore, this report has been prepared the
completion of my internship at Flipkart pvt ltd. The Flipkart’s Story encompasses what
we believe in, where we're going, and how we’ll get there. It includes their Purpose,
Values, Vision, Strategy, and their Promise. Their story helps us make informed
decisions as we respond to challenges and pursue new opportunities. This study helps
to understand the consumer preferences on online marketing with main reference to
Flipkart and other competitors on the same field. The question of trust is more important
in internet shopping than in offline trade. Since the Flipkart’s mission itself is: To
“provide their customers a memorable online shopping experience”, they always make
sure to maintain the trust of the customers. This is because the cultivation of trust is
particularly important when uncertainty and risk are Inherent and contracts and
warranties are often absent. This makes shopping on the internet inherently risky from
the view point of security, because of the importance of trust in inherent shopping; initial
trust in internet vendors is a major factor influencing the growth of e-commerce.

The overall brand value of Flipkart is good, but it is facing some tough competitions from
its global competitors like e-bay and Amazon. But if talking about domestic market i.e.
India; it is the most superior E- Business portal which is aggressively expanding and
planting its roots deep into the Indian market and at the same time shifting the mindset
of the people i.e. from going and shopping from physical store to online stores, which is
magnificent.

During my internship tenure, I have learnt much more information about the culture and
working environment at Flipkart. Finally, I would like to say that my internship at Flipkart
was full of learning and an extremely knowledgeable experience.

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 Bibliography

 www.wikipedia.com
 www.flipkart.com
 www.Slideshare.com
 www.yourstory.com
 www.successstory.com
 www.bigcommerce.com
 www.economictimes.com
 www.marketing91.com
 www.ecommerceguide.com
 www.elementum.com
 www.medianama.com
 www.investpedia.com
 www.notesmatic.com
 www.teikametrics.com
 www.coursehero.com
 www.ibef.org
 www.business-standard.com
 www.yourarticlelibrary.com

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Annexures

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