Flipkart has tried very well to become an ecommerce giant in India, it has grown to follow the market place model where it acts as an entity that helps buyers and sellers interact. Market place model has made a win-win situation for both the merchants and buyers, as the merchants have got more visibility in the market, buyers have saved their time, efforts and money by purchasing products online. Flipkart has been focusing a lot on customer delight. It has also started to use its backend data for personalised offerings, in which they use analytics to understand the user behaviour and needs, thus offering them a class of related products, which not only helps them sell more products but also helps retain customers. Their supply chain is robust enough to deliver the products way before the said delivery date and customers have various options to pay either by cash on delivery or direct payment by net banking, debit card and credit cards. To serve its customers effectively it has customer grievance redressal system which has been ignored by the competitors thus has made it a superpower in e-commerce industry.
Flipkart has also felt the fear of cannibalization due to its heavy reliance on smart-phone sales, which allowed its competitors to zoom in other domains; its less market share in apparel made it acquire ‘Myntra’, which was a great step to bring sustainability with profits. But its decision to go app-only and to offer discount-driven sales led to a flop show. Typically firms go app-only when they are aware that most of their internet traffic comes from mobile, and when the focus is more on customers in tier II and tier III cities. But this leads to ignorance of importance of google and loss on significant number of deals through searches, moreover ‘Myntra’ is a transaction platform as opposed to facebook and google, which necessitates its customer to have good internet connectivity, which is not as expected in tier II and tier III cities. The shift from desktop site to mobile- site was abrupt and did not give time for customers to get used to it. All this has made flipkart think on its business model and restructure it as there is a huge competitor pressure.
It is evident by flipkart’s abrupt shift to mobile-site that it takes bold business decisions, which turn out profitable many times. As in case with its use of business analysis and association rules to offer its customer a set of products that are purchased together, this not only helps it sell more products but also improves customer retention. However it is high time that it spends some quality time in enhancing the customer base. Word-of-mouth is the best way of advertising for such a firm as it incurs no cost and customers are engaged more in advertising. To achieve this flipkart can give itself a social networking touch, a site where people not only come to buy products but also share their reviews about the products they are buying to their friends by sharing the pictures, prices of the products and other related details, currently this purpose is served by publishing reviews which are not as effective. This kind of facility will increase the traffic to the site and will make it a self-advertising platform. Customer’s will be more interested in spending time on the site thus understanding consumer behaviour would be more easy. The more the understanding of the customer needs a company has, the more it can attract new customers and retain old customers.
--Richa Kumari
About the author
Richa is a first year, 2016-18 batch, PGDM student at IIM Ranchi. She is a start up enthusiast and her interest lies in analytics and finance. She likes to read everything about what is going on in the world and she loves to debate on various topics.
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