Flip Kart

Flipkart: Journey of an
Indian E-commerce
Start-Up
Q1. What does it take to build an ecommerce business in india?
To become a part of an eCommerce marketplace, all you need to have is a bank account and a Tax registration
number so that you can apply easily. The marketplace will take care of everything, i.e. website design, website
development, technology, marketing, payment gateway, etc
Value creation Network effects Multi-vendor marketspace

Value for customers must As the number of users Improves availability of products,
be beyond just the physical increases, their experience increases no. of options and
product improves through reviews, WOM improves security
and better estimation of demand
Build your brand Build relations

Increase engagement with the Having a robust grievance
user to capture mindspace in redressal mechanism is
order to strengthen brand essential to build trust and
recall increase repeat purchases
Q2. How is online retailing different from traditional brick-and-mortar
retail?
Online retailing can offer lower prices due to less expenses e.g. in the field of staff costs,
distributing costs and less advertising costs.
Online, they have global access to products 24/7 and the customer can compare the prices and reviews
of products among the different online retailing stores.
The customer can comfortably sit at home choose out of a variety of products and
order them at their convenience.
Mostly customers are eligible for free shipping and have the benefit of flexible returns
Q3. Why is it important for Flipkart to enter into product categories
other than books?
The more you have, the more options you can give the customer, and the more individual tastes you can cater for.
One Stop Solution Increase traction

This would promote flipkart as
one stop solution
01 Due to wide range offering, more
people would visit the site
02
Better Bargain Reduce Cost
Flipkart would have high bargain 03 Logistics cost would reduce as more 04
power as dealers would like to products could be shipped at bigger
have their product listed on it’s batches
site due to high traction
Q4. SWOT Analysis of Flipkart
Strengths Weaknesses
● India’s Largest E-commerce Retailer ● Limited Distribution channel reach
● High Brand recall: TV ads, online ● Low quality of some products: pirated
branding, social media copies sold
● Own Payment gateway & Logistic arm ● Power in the hand of buyers: Without
●
●
Exclusive & broad range of products
Strategic acquisition and partnership SWO product differentiation, fight is then
on the basis of price
Opportunities T Threats
● Expansion of business: targeting emerging ● Stiff competition from the other

markets players like Amazon, snapdeal
● Expanding their Product categories: to ● Government regulations on the issues
increase customer base and reduce cost of related to FDI in multi branding retail
acquisition and customer switch ● Ruler market stagnation and urban
● Increasing numbers of Internet users in India market saturation
● Faster delivery for premium member ● Buyer power and switching is very
high
Q5. How does the macro environment play a vital role in the case of flipkart?
PESTEL Analysis
Political factors:
Flipkart, growth in india can be made difficult by the Red tape. Several news reports highlight how Red Tape in India can become major
difficulty in the way of new businesses trying to extend Flipakrt presence here.
Economic factors:
During the pandemic too, businesses across several sectors were affected by the temporary recession like situation. However, this time
while the pandemic had a negative impact on businesses on one hand, on the other, it also drove sales through online channels higher
Social factors:
Cultural factors have an impact on how these ecommerce businesses market themselves. In several societies of the India ecommerce is
still seen as a sign of Westernization due to which it has seen low growth in these areas.
Technological:
Technology decides several things in the ecommerce world from popularity to profits. The reason that Amazon is ahead of the others is
because it is technologically ahead of the others. It has managed its customer experience so well that its popularity is very high
Environmental:
While the direct environmental impact of this industry is very low, it still focuses heavily on sustainability. Brands like Amazon have invested
heavily in environment and sustainability.
Legal:
Legal compliance is just as important for the digital businesses as physical businesses globally. Any tussle with the law can be a costly
affair and even the e-retail brands can become a target unless they take care of compliance.
Q6. Porter's 5 Forces : situational analysis for Flipkart
Supplier Power Buyer Power

● To attract the buyers to new mode
● Bargaining power of suppliers is
of purchase, various methods are
very low since flipkart is
tried to make process easier
renowned brand
● Products are not differentiated,
● With inventory based model,
hence buyers can easily switch
flipkart bulk buy from suppliers
Rivalry among options
With no entry barriers and
the high threat of new
players, the competition is
getting more and more
intense
Threat of New Entry Substitutes

● Substitutes in the e-commerce
● Industry condition : very high
industry appears to be very high
potential but it is at its nascent
due to the variety of services
stage
● Traditional retail stores are
● Entry of small player to explore
trusted by customers
niche area
Q7. What marketing tactics were employed by Flipkart and which one seems
to have been the best?
● Flipkart initially followed the inventory model, shifting to hybrid model and ultimately following marketplace model
● Flipkart saw expansion of the marketplace as a great monetisation, high margin play, as they earned commission on
any transaction done on their platform without incurring any of the inventory holding cost.
● Flipkart handled customer billing & logistics , picking up from sellers the goods to be delivered to the customers.
● Flipkart used competition among sellers to drive prices down & marketplace model scaled up
Marketplace model – Connect buyers & sellers. Infinite sellers, unlimited products. Investor friendly model. Highly
scalable
Q8. Keeping in mind the present situation of Flipkart, should the company’s
emphasis be on growth in market share or profit?
Flipkart Sould focus on Market share, why?
With the increased market share, it also helps the organization gain positive brand equity but it incurred various kinds of
losses within the organization.
Other disadvantages of focusing on market share is that, it brings a wide social and economic gap within the organization .
Flipkart would find difficult to recover from auch economic gap which will be created within the organization.
Due to this, we would suggest that flipkart should focus on sustainability instead of market share
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Flipkart: Journey of an

Value creation Network effects Multi-vendor marketspace

Build your brand Build relations

One Stop Solution Increase traction

● Expansion of business: targeting emerging ● Stiff competition from the other

Supplier Power Buyer Power

Threat of New Entry Substitutes

Flipkart Sould focus on Market share, why?

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