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Flipkart’s valuation markdown

economictimes.indiatimes.com

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Re: Flipkart’s valuation markdown

#11

Post by supersan »

nischalsamji wrote: post #5
sidko wrote: post #4

Earlier quoted context omitted.

Can you elaborate on your comment that Amazon is imitating Flipkart to an extent? Are there specific examples where Amazon is doing this? Is it possible to learn from the Indian market and bring those ideas to a more global audience?

Was Cash on Delivery introduced by Flipkart before Amazon in India? If so, I think amazon is 'imitating' flipkart in this area. I see COD on UPS, Fedex in USA but not as popular as COD in India.

eBay.in offered cash on delivery waaay before flipkart (as a matter of fact, the original site Baazee.com which got merged into eBay did it very successfully too)

Re: Flipkart’s valuation markdown

#12

Post by kchoudhu »

camillomiller wrote: post #8

I think these are extremely useful corrections. Investors are really worried about an implosion and are basically scrambling to defuse the ticking bomb. If they'll show enough maturity and they'll be willing to let greed subside for a couple of years, maybe we'll end up having a better, more realistic, high-tech scene pretty soon without any bubble having to burst. Or it won't be enough and they're all screwed noneth…

If only there were a way to automatically mark down poorly performing companies based on incoming market data on a daily, nay!, hourly basis...

Re: Flipkart’s valuation markdown

#13

Post by achow »

electic wrote: post #7
achow wrote: post #6

Earlier quoted context omitted.

Popular myth is COD (Cash on Delivery) model was pioneered by Flipkart which other e-tailers (Amazon including) adopted. The myth is not without it's merit, Flipkart is perhaps the first one which did it at massive scale and showed how it can reduce the friction when converting a website visitor to a paying customer. Further read on COD http://www.businesstoday.in/magazine/cover-story/cash-on-del...

I don't think this is a new concept by any means. It is primarily due to the fact that a large majority of consumers in India might not have the means or the comfort level to put in a credit card. The concept has been around for a long long time. [1] [1] https://en.wikipedia.org/wiki/Mail_order

As mentioned it is a myth. Even within India, the postal dept had this for ages - called 'Value Payable Post' (perhaps going back to colonial days). http://www.indiapost.gov.in/VPPost.aspx

Also, seems like mail order for most part still had to depend upon credit cards. See https://en.wikipedia.org/wiki/Card_not_present_transaction

The point that I was highlighting is Flipkart showed the way as to how this forgotten system (COD) can be leveraged in the days of internet to acquire new customers.

The relevant question here is - If Amazon India came before Flipkart, would they have thought of putting this system in place? Maybe, Maybe not.

But one can hazard at least this much guess that looking at the kind of customer traction Flipkart was getting due to COD system, Amazon India's product managers perhaps had to write far lesser emails to Seattle for incorporating that in Amazon.in.

Re: Flipkart’s valuation markdown

#14

Post by pavanky »

nischalsamji wrote: post #5
sidko wrote: post #4

Earlier quoted context omitted.

Can you elaborate on your comment that Amazon is imitating Flipkart to an extent? Are there specific examples where Amazon is doing this? Is it possible to learn from the Indian market and bring those ideas to a more global audience?

Was Cash on Delivery introduced by Flipkart before Amazon in India? If so, I think amazon is 'imitating' flipkart in this area. I see COD on UPS, Fedex in USA but not as popular as COD in India.

I used Cash on delivery using much smaller website 12-14 years ago in India. IIRC it was just a local company that delivered within the city.

Re: Flipkart’s valuation markdown

#15

Post by adventured »

paulsutter wrote: post #3

Flipkart's valuation increased more then 1000x, then went down 27%. There's nothing catastrophic about that. Are journalists really this myopic or just eager for clicks?

It's about expectation and projection. You say 27% today. Tomorrow it's going to be 50%. The valuation adjustment problems in tech aren't over, they've only just begun.

When the Shanghai Composite Index started falling over after China created a market bubble there, people said: it's up 150% in under a year, and now it's only down 20%, no need to worry. Well, now it's down 50% from that high - below where it was five years ago - and those people are no longer talking about it. It was never the initial drop that mattered, it was all about what was coming next, not what happened the day before.

Re: Flipkart’s valuation markdown

#16

Post by adventured »

nischalsamji wrote: post #5
sidko wrote: post #4

Earlier quoted context omitted.

Can you elaborate on your comment that Amazon is imitating Flipkart to an extent? Are there specific examples where Amazon is doing this? Is it possible to learn from the Indian market and bring those ideas to a more global audience?

Was Cash on Delivery introduced by Flipkart before Amazon in India? If so, I think amazon is 'imitating' flipkart in this area. I see COD on UPS, Fedex in USA but not as popular as COD in India.

The form of COD in India has been around for over a century across nearly the entire industrialized world. There's nothing innovative about it, the debate (Flipkart vs Amazon) is pretty moot given the history of COD stretches so far back.

Re: Flipkart’s valuation markdown

#17

Post by adventured »

For much of Amazon's history, it was lucky to get a 1 to 1 sales to valuation ratio. Amazon's early participation in the dotcom bubble, the money they raised then, funded its ability to survive the drought years afterward. Their stock was net flat for nearly a decade. The market weakness in 2008 for example, pushed their market value below where it was at times in 1998. Between 1998 and 2008 their sales went from $20 million to $20 billion and their valuation didn't change much.

What are Flipkart's sales today? You can expect it won't be worth dramatically more than its recent peak, years from now - and that's the good outcome. It's the routine outcome of extremely high valuations; to the extent they're too high, is the extent to which they pull future returns forward.

Re: Flipkart’s valuation markdown

#18

Post by puranjay »

Anecdotal evidence: within my circle of friends, Flipkart use has dropped considerably over the last couple of years. Personally, I haven't made a single purchase off Flipkart in 3+ years. Their prices are now usually higher than Amazon and they don't have the "long tail" of products I want.

Myntra, which Flipkart bought, is still my go-to source for buying clothes. It helps that Myntra has really the best user experience of all the other apps. Their delivery is incredibly fast too - I ordered a shirt last night and received it today morning!

Re: Flipkart’s valuation markdown

#19

Post by camillomiller »

kchoudhu wrote: post #12
camillomiller wrote: post #8

I think these are extremely useful corrections. Investors are really worried about an implosion and are basically scrambling to defuse the ticking bomb. If they'll show enough maturity and they'll be willing to let greed subside for a couple of years, maybe we'll end up having a better, more realistic, high-tech scene pretty soon without any bubble having to burst. Or it won't be enough and they're all screwed noneth…

If only there were a way to automatically mark down poorly performing companies based on incoming market data on a daily, nay!, hourly basis...

I don't think it could work. Computers with specifically designed algorithms and extremely fast connection could exploit such a real time market and outperform human traders. Nobody in his right mind would let that happen!

Re: Flipkart’s valuation markdown

#20

Post by thewhitetulip »

ignoramous wrote: post #2

Flipkart is still a market leader by a considerable margin. Its main stay has been electronics and fashion retailing. It is excelling at both, and shows no signs of slowing down. It has managed to attract top-tier engineering talent in the Country (India), by offering generous wages and generally because it has some very tough problems to solve. Amazon has been making in-roads, capturing a size-able market share, but…

I beg to disagree, the use of Flipkart has gone down considerably because their prices are much higher than of Amazon. I personally have not used Flipkart in a long time now. Latest buy was from Amazon three days ago.
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