NTCC Report

On
An Organizational Study on the Growth of E-Commerce in India with special
reference to Flipkarts Case Study
By
OJAS SINGH

A3104613017
B.COM (Hons.)
Under the Supervision of
Col. K.S. Mohan

In Partial Fulfillment of the Requirements for the Degree of

Bachelor of Commerce
At

AMITY COLLEGE OF COMMERCE & FINANCE

AMITY UNIVERSITY UTTAR PRADESH
SECTOR 125, NOIDA - 201303, UTTAR PRADESH, INDIA

CERTIFICATE
I, Col. K.S. Mohan hereby certify that Ojas Singh student of
B.Com(Hons) at Amity College of Commerce & Finance, Amity
University Uttar Pradesh has completed the NTCC Report on An
Organizational Study on the Growth of E-Commerce in India with
special reference to Flipkarts Case Study, under my guidance.

Col. K.S. Mohan

Contents
Introduction...............................................................................................................4
Key drivers in Indian E-commerce are:.....................................................................5
Company Profile........................................................................................................5
Company Growth and Expansion..............................................................................6
Interesting Facts and Figures about the portal...........................................................7
Flipkart Success Factors............................................................................................7
Challenging the Challenges.......................................................................................9
Marketing Strategies..................................................................................................9
Growth and Upcoming Prospects............................................................................10
Conclusion...............................................................................................................11
References...............................................................................................................12

Introduction
India has an internet user base of about 354 million as of June 2015. About 6
million entrants are added every month. As of Q1 2015, 6 Indian e-commerce
companies have managed to touch the billion dollar mark, namely, Flipkart,
Snapdeal, InMobi, Quikr, OlaCabs and Paytm.
In 2013, Indias e-commerce market was worth US$ 2.3 billion. About 70% of
Indias e-commerce market is travel related. According to Google India, there
were 35 million online shoppers in India in 2014 Q1 and is expected to cross 100
million mark by end of year 2016. Electronics and Apparel are the biggest
categories in terms of sales.
Indias e-commerce industry is likely to clock a compounded annual growth rate of
35% and cross the $100 billion mark over the next five years, from $17 billion at
present, according to an Assocham-Pricewaterhouse Coopers study. Riding on the
strong growth momentum of 2015, the e-commerce sector is estimated to see a
72% jump in the average annual spend on online purchases per individual in 2016,
from the current level of 65%, the study said.
In contrast, shopping malls are suffering from lesser footfalls leading to around
25% vacancy rate, along with a 30% drop in rentals in the last one year, according
to the study.
Besides, with improvement in infrastructure such as logistics, broadband and
Internet-ready devices, there is likely to be a significant increase in the number of
consumers making purchases online, the study said, predicting around 65 million
consumers in India to buy online in 2015, as against around 40 million in 2014.
Some 45% of malls in India are expected to be converted into non-retail space in

the next 15 years, which would be replaced with movie theatres, restaurants,
discount retailers and the like, the study projected.

Key drivers in Indian E-commerce are:

Large percentage of population subscribed to broadband internet,
burgeoning 3G internet users, and a recent introduction of 4G across the
country.
Explosive growth of smartphone users, soon to be world's second largest
smartphone userbase.
Rising standards of living as result of fast decline in poverty rate.
Availability of much wider product range compared to what is available at
brick and mortar retailers.
Competitive prices compared to brick and mortar retail driven by
disintermediation and reduced inventory and real estate costs.
Increased usage of online classified sites, with more consumer buying and
selling second-hand goods
Evolution of Million-Dollar startups like Jabong.com, Saavn, Makemytrip,
BookMyShow, Zomato, Flipkart, Snapdeal etc.

Company Profile
Flipkart.com is an Indian based e-commerce company started by Binny Bansal and
Sachin Bansal, who previously worked at Amazon.com. Post their experience, they
ventured into a similar e-business idea and launched it in India. Flipkart.com works

with the aim of making products and goods easily available at the doorsteps of
anyone who has internet access. Flipkart.com started off from selling books in
2007, based in Bengaluru, and entered then consumer electronics category with the
launch of mobile phones in September 2010. Since then it kept on adding more
new product categories including books, mobiles, computers, cameras, home and
electronic gadgets and appliances.
It is now one of the leading e-commerce players in India, currently ranks at the top
20 websites in India, spread in 37 cities, with 11.5 million plus book titles, 14
different categories, 3 million plus registered users and sale of 30000 items a day.
It provides online-shoppers a memorable online shopping experience because of its
innovative services like:
Cash on Delivery
30-day replacement policy
Easy Monthly Installment options
Free shipping
Discounted prices and deals

Company Growth and Expansion

The company was initially self-funded, by both co-founders Sachin and Binny
Bansal spending Rs.400,000 to set up the business. They later raised funds from
Private Equity Investors, i.e. Accel Partners and Tiger Global Management of $31
million.
In the year 2010, the company acquired WeRead, a social book discovery tool; in
2011, Mime360, a digital content platform company and Chakpak.com, a
Bollywood news site; Letsbuy.com which is Indias second largest e-retailer in

electronics, in 2012; and in 2014, Myntra.com which is one of Indias largest

online fashion retailer.

Interesting Facts and Figures about the portal

Flipkart employs more than 4500 people
2 million sales unit and 4 million visitors/month
11.5 million titles, Flipkart is Indias largest online book retailer.
Registered user base of 4 million customers.
Ships out as many as 45,000 items a day, clocking daily sales of approx. Rs
2.5 cr.
Flipkart is now investing in expanding its network of distribution centers,
warehouses, and procurement operations, so as to reach more and more
Indian cities.
The company is even setting up its own delivery network which is now in 37
cities, by which company can save up cost associated to the outsourced
shipping and logistic function and is set to expand this even further by next
year.

Flipkart Success Factors

The site is very easy to navigate, which helps users to easily search for the contents
or products online, it even allows users to search by using various filters like by
price range, search by brands, by age group, by hot-selling etc. If a certain product
is not available or is out of stock it even ask users to input its details and then when
the product is available the desired users are informed, this really helps one

connected to the products they are seeking and leads to repeat and frequent
purchases.
The Flipkart site is fast and powerful, i.e. if you search any products in the Flipkart
search bar and youll find exactly what a person is looking in no time and its very
quick to process the payments and transactions by a very efficient and flexible
payment mechanism of the portal. Approximately 60% of the orders are placed in
cash on delivery system, so there is a high possibility of scams and frauds,
therefore users are required to link their e-mail accounts and provide other details
and verify the details through a confirmation code message on their cell phones or
e-mail, after which the transaction is processed and usually gets delivered in 2-3
business days on the confirmed address.
Flipkart manages to deliver the item in 2-3 business days. If the order placed is not
delivered in the specified time, immediate enquiry goes to nearest supplier and the
item becomes available. It will then be delivered within 24 hour depending on the
cause of delay.
Flipkart is continuously aiming to bring down the delivery time of regular orders,
in doing so it is investing in its own delivery system and network because the time
to delivery is one of the important aspects of selling products online. An excellent
marketing strategy by Flipkart marketing team is to increase the sales revenues and
to optimize the user shopping experience and increasing loyalty by repeat
purchases.
The portals offers a good pricing offers and deals to its users by the means of cash
rewards, loyalty points, discounts, coupons, buyer reward points. It even offers

goods relatively cheaper than it is available in the physical market which in total
helps users save money and at the same time get benefitted by the means of reward
points.

Challenging the Challenges

One of the biggest hurdles is the lack of infrastructure to support new businesses,
therefore managing logistics and supply chain is a big cost and concern affecting
all the e-commerce companies.
Another big obstacle is that the users having lack of trust over making payment
online using the payments gateways makes it more difficult for the e-businesses to
attract more customers and increase sales units and revenues. Additionally, Indians
have a distaste to credit cards- only an estimated 2 percent of the nation has a
credit card and a number of new payment gateway companies such as Paypal and
CC Avenue have sprung up to service the growing e-commerce ecosystem.

Marketing Strategies
Flipkart initially followed word of mouth marketing to popularize their company.
A few months later, the first book company sold on Flipkart.com- John Woods
Leaving Microsoft to Change the World. Subsequent to its success on its book
category, Flipkart aggressively marketed themselves on all over the net and
specially banked in the social networks like Facebook, twitter so as to get
connected to the users and to all the aspiring customers. Over the years, Flipkart

has managed to build a strong community having millions of followers on its

twitter and Facebook pages giving instant responses and interaction.
Flipkart has also managed to sync all its operations via the mobile apps on all the
major platforms like android, apple, blackberry and a mobile website facilitating
the online purchases and selling functions.
From such mobile applications and strong groups online, it is handling its
promotion and sales proposals, consumer databank in offering them the desired
outlook and at the same time keeping them informed about the new product addons, campaigns and pricing and latest offerings.
However, Flipkart has gone aggressive on the offline mass media as well, i.e. T.V.
and Print. It has devised advertisement campaigns on both T.V. and Print, by which
it has facilitated in creating its brand presence vast.

Growth and Upcoming Prospects

Should look for Global markets or Bordering nations
Strategic coalition with worldwide brands and suppliers, i.e. obtaining and
routing the global products in the national market and vice versa, this can
help them get price advantage.
Internet users in the country are increasing at an increasing rate, so Flipkart
can aim more cities, i.e. not only tier 1 & 2 but also tier 3 & 4 cities, which
will help generate stronger consumer base and more returns.

 Should emphasize on the rising online clothing business and it can expand
into clothing category either slowly or by procuring other portals.
Firm should emphasize on selecting the middle class, which constitutes up to
40% of the countrys population.
The portal should constantly target to develop the customer involvement by
adding additional and inventive features in the website like virtual shopping
basket, virtual trial rooms, etc.
Should constantly target to decrease the distribution phase cycle by
improving logistics and supply chain.

Conclusion
The brand worth of Flipkart is respectable, but it is facing some hard rivalry from
worldwide players like Ebay and Amazon. But, when we talk about the national
market, it is the greatest E-business portal which is aggressively growing and
establishing its roots deep into the national market and the same time shifting the
attitude of the public, i.e. from going and shopping from brick and mortar stores to
virtual stores, which is brilliant.
The market for E-commerce is growing constantly and impressively. This means
that there will be tough competition for the brick and mortar stores to survive in the
future as every product and service category will be available online and the
customers will not require reaching the brick and mortar stores for shopping. In the
future more and more e-commerce websites will be added and the e-commerce
market will expand very quickly all over the country.

References
en.wikipedia.org
businessstandard.com
timesofindia.indiatimes.com
businesstoday.in
economictimes.indiatimes.com
thehindu.com
successstory.com
slideshare.net