Prepared by AKASH TYAGI | Section B

flipkart- Indias largest Online

Store!!!
Leading Indian E Commerce company headquartered in
Bangalore.
Started by two IIT graduates (earlier employed with
Amazon) in year 2007.
Indias largest online bookseller with over 11.5 million titles
in offer.
Added other products like media, electronics, personal and
health care.
Boasts 100% growth every quarter since founded.
Funded by owners Bansals, VCs Accel India and Tiger
global.
Projected sales for year end 2011-12 stands at US $ 100
million.

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flipkart- Indias largest Online

bookstore!!!

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Flipkart Book stores target

customers
FLIPKART

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flipkart- Vision, Mission and Values

Vision
To become Amazon of India.

Mission
Providing a delightful and memorable customer
experience.

Objective
Completely hassle free shopping experience with
best prices in India.

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Porters five forces for Indian E

Commerce market
Low capital investment.
High technological intensive players.

Existing: Attractive
Entrant: Not
Attractive

Rivalry
Among
Competitors
(High)
Low entry
barriers
Huge
market.

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PEST Analysis framework

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Market players: Selling New Books

Online Book Sellers (20 % market)- Direct

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flipkart: Long term objectives

Strategic Objective: Flipkart aims to become the
largest retailer of India. Flipkart wants to be present
across all categories, except in groceries and automobiles,
the CEO said. Our target is not just those who shop
online. We want to highlight the convenience of ecommerce to traditional offline shoppers and, thus, help
grow theDiversify
market.
product portfolio into home appliances, electronics, etc.
Financial
US $ 100 million revenue.
Objective:

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Complete book market: Brand awareness

versus Price
Flipkart:-

Brand
awareness

Hig
h

Traditional
Bookstores:Book Adda:-

The strategic map suggests that

neither Brand awareness nor
Prices are key success factors in
the market. Since Flipkart is not
the industry leader with high
Brand equity and lower prices.

Mediu
m

Infibeam:-

Traditional
Bookstore
s
Low
Low

Mediu
m
Prici

High
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Complete book market: Brand awareness vs

Network/ Reach
Flipkart:-

Brand
awareness

Hig
h

Mediu
m

Traditional

The strategic map suggests thatBookstores:Book Adda:Network reach of fragmented

book shops is Name of the
Infibeam:game and it is amplified due to
low internet penetration and
online shopping awareness in
India. But with changing trend
Flipkart will move to high reach
and thus grow its market share
based on other competencies.

Traditional
Bookstore
s
Low
Low

Mediu
m
Networ

High
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Complete book market: Price versus

Delivery time

Pricing

Hig
h

Traditional
Bookstore
s

Mediu
m

The strategic map suggests that

low delivery time is a KSF. It is
obvious that physical book stores
will give immediate delivery while
for any online book store it will
take a number of days. Flipkart is
low on delivery time and
guarantees 3 days delivery on
several items. But physical book
stores also take advantage of on
the spot buying behavior.

Flipkart:Traditional
Bookstores:Book Adda:-

Low

Infibeam:-

Low

Mediu
m
Deliver

High
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Key Success Factors: Indian New

Books market
Key Success
Factor

Weig Flipka Infibea Bookad Physical book

ht
rt
m
da
stores

Network/Reach

0.5

1.5

10

Delivery/ Spot buy

0.5

1.5

10

Total weighted
score

Total market share 100%

3.5

1.5

10

16%

2.50%

1.50%

80%

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Conclusion: Competition in Indian

new Book Market
Competitors :- Online Book stores and Physical Book
stores.
Online Book Store markets projected growth at 30-35%
in next 5 years.
52 million active Internet users with only 40 per cent
online shoppers.
Largely scattered physical book stores across the towns
and cities.
Spontaneous/physical buying behavior of Indian
consumers visiting malls.
Books are amongst the most gifted items in Indian
youth.
Displays large disparity between online and physical
book stores target customers.
Online Book stores will eat the market share of Physical
book stores but only after customer transition to Internet
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medium of purchases.

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Online Book Stores: Brand awareness

versus Price
Flipkart:-

Hig
h

Others:Book Adda:-

Brand
Awareness

Infibeam:-

The strategic map suggests that

both price and brand awareness
are key success factors in the
market. Flipkart is the industry
leader with 80% market share
having a very high Brand
awareness and lowest prices.

Medium

Low
Low

Mediu
m
Prici

High
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Online Book Stores: Convenience versus

Availability

Convenienc
e

High

The strategic map suggests

that both Convenience and
Availability are key success
factors. Convenience caters
to user friendliness of portal,
tie ups with banks for
reliable transactions.
Availability refers to number
of titles and various types of
additions.

Medium

Flipkart:Others:Book Adda:Infibeam:-

Low

Low

Mediu
m
Availabilit

High
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Online Book stores: KSFs and

threshold factors.
Key Success Factors:
o Brand awareness.
o Convenience (Delivery time and reach, user
interface and experience and Tie Ups for safe and
reliable banking).
o Availability (number of available titles, various
editions and print types like hard
bound/paperback).

Threshold Factors:
o Being a very new industry in Indian market
almost every factor contributes to the Key success
of an Online book store. Going forward some of
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the KSFs will turn into thresholds.

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Key Success Factors: Online new

books market
Key Success
Factor

Weig Flipkar Infibea Bookadd

ht
t
m
a

Brand
awareness
0.15
Convenience
0.60
Delivery
time
0.2
Delivery
reach
0.2
User
Experience
0.10
Reliability 0.10
Availability
0.15
Price
0.10

Total weighted
score
1.00
Total market
share
100%

Others

10

3.5

10

8
9
10
9

3
4
3
7

3
4
2.5
6

3.5
4
4
6

9.4

3.175

2.725

80%

7.00%

5.00%

3.35
8%

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Flipkart s existing triangle

Competencies:
Key Success factors:
brand awareness
convenience
delivery reach
delivery time
reliability
user experience
availability
price

excellent product delivery

self owned delivery n/w
supplier network
first mover advantage
payment mode
excellent services
internet strategy (search
engine optimization)
large loyal customer base.

Value proposition:
Completely hassle free online
shopping experience with best
prices in India.

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Flipkart s new triangle: raising the

bar
Key Success factors:
brand loyalty
User experience
Reliability
convenience
delivery reach
delivery time
mobile shopping
availability
product modes (printed/
e-books)
titles
Threshold factors: Brand
awareness, price.

Competencies:

large self owned delivery

channels
supplier network/ first to
market
mobile shopping solution/
increased reach
innovation in
services/payments/technology
excellent customer services
internet strategy (search
engine optimization, platform
advancement)
large loyal customer base.

Value proposition:

Completely hassle free

shopping experience with best
services to everyone,
everywhere and everytime in
India.
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Future KSFs: Online books stores

Key Success
Factor

Brand loyalty
User
Experience
Reliability
Convenience
Delivery
time
Delivery
reach
Mobile
Shopping
Availability
Product
modes
Titles

Expected
weighted score

Weigh
t
Flipkart Infibeam

Bookadda

Others

0.30

0.20
0.10
0.50

10
10

5
5

4
3

4
3

0.15

10

2.5

0.20

10

2.5

0.15
0.20

0.10
0.10

9
10

2
5

2
4

4
5

1.00

9.75

3.25

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2.575
2.9TYAGI

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Future KSFs: Conclusions

Convenience: still remains the name of the game.

o An online/mobile shopper still remains strong on the convenience

touch point with main factors as Delivery reach to wide spread
locations, short delivery times. Early advent into providing a mobile
platform for on the go shoppers and shoppers with less access to other
standard internet devices.

Brand Loyalty:

o Excellent user experience on the e commerce website in terms of

usability, speed, clarity will enhance the loyalty of existing customers
and move a step ahead of brand awareness towards customer
retention.

Availability:

o Choice/availability of printed mode or e- books will play a major role

in catering to a larger audience with varied needs/interests. Number of
titles in either product mode will still remain a strong factor in
determining customers interest in purchasing from any Online book
store.
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SWOT : Strategic options

External

Opportunity:
1. Untapped mobile users
2. Coverage of all parts of
India
3. Tie ups with Book
fairs/education
institutes.
4. Enter new untapped
global markets
5. Self e-publishing

Threat:
1. Low internet
penetration
2. Less usage/preference
of online buying
3. Small value orders in
remote areas with high
delivery costs
4. Amazon will enter soon

Strength:
1. Customer service
2. Online discoverability
3. Brand
4. Inventory management
5. Self owned delivery n/w
6. Supplier network/relation
7. Innovation and technology
competence.

S1S3S7O1: Provide mobile

platforms.
S2S4S5O2: Increase the reach.
S3S4O3: Target students and
education sector.
S2S3S5S6O4: Enter new
attractive global markets. E.g.
Srilanka.
S2S3O5: Tie up with authors to
acquire rights.

S2S6S7T1T1: Mobile
consumers
S1S3S7T2: marketing to
educate reliability to customer
S4S5T3: Save costs and
provide package deals for
higher value orders.
S1S3S4S5S6T4: Enhance brand
loyalty ,customer service and
build on delivery and supplier
n/w.

Weakness:
1. No control over small value
orders
2. Free shipping built costs
3. Less reach as compared to
physical book stores.
4. Global reach.

W1O3: Tie up with educational

institutes for providing bulk
orders to students/schools.
W2O2O5: reduce delivery costs
with widespread warehouses
and promoting high margin ebooks.

W1W2T2T3: Minimize small

value orders.
W3T1: Promote other mediums
of buying like mobile,
telephone or may be small
retail outlets.
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W4T4: expand to new

Analysis

Internal Analysis

Strategic Options filter specific to

Flipkarts book store
Short/ long term Strategic options

Long
term
objecti
ves
(.30)

Value
propo
sition
(.30)

Capa
bility
(.30)

Align
ment
to
goals
(.10)

Weigh
ted
Score

Increase the reach using mobile

platform, telephone or physical
medium.

8.7

Tie ups with educational institutes

across India to cater students and
reducing costs through similar order
delivered once.

7.5

Setting up own E-publishing house by

acquiring rights from authors to
publish high margin e-books.

3.6

Enter new untapped/unserved global

markets like neighboring Srilanka.

8.6

Reduce costs by increasing

warehouses and suppliers across the
country.

10

10

9.4

Increase margins through bundled

deals for small value customers .

10

10

10

9.7

Marketing efforts to educate Flipkarts

reliability and safety shopping to

10

8.5

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Recommendations to Flipkart
Short Term:
Flipkart must develop mobile application/solution for huge
cell-phone customer base of India helping it to increase its
reach.
Increasing margins while reducing losses by providing
attractive bundled deals to low value shoppers.
Provide small mobile outlets in cities with limited reach to
internet and increasing demand.

Long Term:
Enter new international markets which is either un-served or
untapped.
Focus on high margin products like e-novels for a book store.
Diversify into all product categories (achieved) to achieve
economies of scale.
Educate Indian conventional customer by marketing efforts.
Increase bulk selling and reach to student customers by ties
with educational institutes for academic curriculum
supplies.
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25

IA to O framework
Outputs O

I
n
n
o
v
a
t
e

P
r
o
f
I
t
s

Lower costs
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CCC Costumer company connect

framework
Respect the customer-> loyal Customer-> WIN

Cost
Cost
advanta
advanta
ge
ge

Employ
Employ
ee
ee
strengt
strengt
h
h

Constant
Constant
Innovatio
Innovatio
n
n

Supplier
Supplier
relation
relation
s
s
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27

References
http://www.pluggd.in/flipkart-story-ecommerce-differentiator-297/
http://blog.flipkart.com/
https://www.flipkart.com
http://www.thehindubusinessline.com/todays-paper/tp-newmanager/article2507045.ece
http://www.iamwire.com/2012/02/flipkart-is-all-set-to-buy-letsbuy-com/
http://www.deccanherald.com/content/190213/indian-e-commerce-firm-flipkart.html
http://www.guardian.co.uk/books/2009/apr/22/books-india-china
http://timesofindia.indiatimes.com/business/india-business/Flipkart-faces-heat-ofrivals-discounts/articleshow/13029174.cms
http://www.sramanamitra.com/2010/10/04/building-indias-amazon-flipkart-ceo-sachinbansal-part-1/
http://www.slideshare.net/VarunAthreya/flipkart
http://www.slideshare.net/krupashankarnj/flipkart-12116318
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THANK YOU
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