It appears that Flipkart did all the heavy lifting of preparing the market and then Amazon showed up. This story might not have a happy ending for Flipkart.
Flipkart’s valuation markdown
31–40 of 40 posts
Re: Flipkart’s valuation markdown
#32Flipkart losses are growing fast http://www.livemint.com/Companies/UQAIOMlml7iM6oVufedjOJ/Fli... I do not think their business model is unique. They are taking investor's money and giving as discount to customers. Important thing to note here is unlike Amazon in US which was genuine innovation for local customers as delivery to home for millions of product who would hate to go out and shop. In India home delivery by…
> I am not sure what will be their (Flipkart’s) value proposition. You are missing out on the whole forest. If you think Amazon was an innovation, solving for ‘hate to go out for shopping’ scenario, then ecommerce in India is 100X of that innovation. It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a S…
First mover advantages are weak, at best. A second mover that executes better and or has a meaningfully superior product or value proposition will win just about every time.
See: Atari (Nintendo), Friendster (FB), MySpace (FB), Motorola (Apple, Samsung, Nokia), AltaVista (Google), Nintendo (PlayStation), Apple (Windows), Microsoft (iPhone, iPad, Android), Betamax (VHS), RealMedia, Ford (GM), Walkman (iPod), 3dfx (nVidia), Yahoo, AOL (open web), Hotmail, Woolworth's (Sears), Kmart/Kresge and Sears (Wal-Mart), US Steel, Blockbuster (Netflix), Kodak & Polaroid (digital), Sun Microsystems, Xerox, Borders & BN (Amazon), Blackberry & Nokia (iPhone), VisiCalc (Excel), Lotus Notes (MS Office). All examples of first/early movers that got displaced.
Re: Flipkart’s valuation markdown
#33Earlier 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
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Re: Flipkart’s valuation markdown
#34Earlier 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.
Absolutely, I was offering Cash on Delivery using VPP back in 2004 for my baazee.com store(eBay acquired baazee to enter Indian market as ebay.in)
India Post offered Reverse Money Order as a service aka VPP(http://chennaipost.gov.in/vpp.aspx)
Re: Flipkart’s valuation markdown
#35Earlier 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?
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...
Flipkart's COD model has many innovations. Ecom's main payment option in US is credit cards; India does not have many people having credit cards. Also people did not want to prepay because of their past experiences with other services. Flipkart was able to COD on a large scale, became reliable and trusted, and was able to overcome people's reluctance to purchase online. Flipkart's other innovations, easy returns, their own delivery network, not depending on 3rd parties.
Re: Flipkart’s valuation markdown
#36Most Indians don't want credit cards because they don't want to fall prey to them. Those who have them use them only when it's absolutely necessary. They buy what they need and pay by cash. Credit cards are addictive.
Re: Flipkart’s valuation markdown
#37Flipkart losses are growing fast http://www.livemint.com/Companies/UQAIOMlml7iM6oVufedjOJ/Fli... I do not think their business model is unique. They are taking investor's money and giving as discount to customers. Important thing to note here is unlike Amazon in US which was genuine innovation for local customers as delivery to home for millions of product who would hate to go out and shop. In India home delivery by…
> I am not sure what will be their (Flipkart’s) value proposition. You are missing out on the whole forest. If you think Amazon was an innovation, solving for ‘hate to go out for shopping’ scenario, then ecommerce in India is 100X of that innovation. It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a S…
>It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a SD card for mobile, or a particular book, or that latest Levis, sneakers, and so on… Heck even in big cities it is a struggle to find things.
This is so true. Even today. Moreover there is an impression of complete lack of transparency in brick and mortar stores, since you are never sure when a shopkeeper is fleecing you.
But sadly Flipkart has pivoted away from customer satisfaction to seller satisfaction as an end goal. As a result their quality of service has gone for a toss, whereas Amazon has always been single mindedly pro-buyer.
Brand inertia will help them retain customers for some time and this also helped because Amazon's android app is just not good enough, but eventually they will crash if they keep ignoring customers.
Re: Flipkart’s valuation markdown
#38Flipkart 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.
I actually visit Flipkart once in a while to see if the prices have changed and in every visit I provide feedback that the prices are ridiculously high and that I'm buying from Amazon or Paytm. I don't believe anyone in Flipkart with the authority to do anything reads the feedback or wants to act on it. I've done this several times over the past couple of years and Flipkart still remains the most expensive for the electronic/electrical products I'm interested in.
I've narrowed down to Paytm as the first source and Amazon.in as the second source to look for products at good prices. Snapdeal comes a distant third.
Re: Flipkart’s valuation markdown
#39Most Indians don't want credit cards because they don't want to fall prey to them. Those who have them use them only when it's absolutely necessary. They buy what they need and pay by cash. Credit cards are addictive.
Credit cards are just one way to manage payments. Whether they're addictive or not depends on the person. Some people even move money out of their savings accounts into some other bank account in a deposit they cannot easily access because having "cash at hand" is a problem for them. That doesn't make bank accounts addictive or problematic overall.
More to your point, there are many in the cities who have credit cards and use them often because they're convenient. Carrying cash or using debit cards when more people are moving to credit cards is foolish and a way to subsidize the people using credit cards.
I have credit cards that I use wisely. Always pay fully on time (no interest), make the most of the credit period by timing purchases as much as possible, etc. I don't have to worry about carrying lots of cash and getting change (or worse, rounding things up while paying). Taking advantage of marketing related discount offers from credit card providers is also another positive. Overall, credit cards provide a lot of value for me, although the social benefit could be argued one way or the other.
Re: Flipkart’s valuation markdown
#40Earlier quoted context omitted.
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.
I actually visit Flipkart once in a while to see if the prices have changed and in every visit I provide feedback that the prices are ridiculously high and that I'm buying from Amazon or Paytm. I don't believe anyone in Flipkart with the authority to do anything reads the feedback or wants to act on it. I've done this several times over the past couple of years and Flipkart still remains the most expensive for the el…
Yes, it certainly looks like that. I had once attended their recruitment drive, in a college. It feels like their processes are screwed up.
We had 90 minutes for developing an application, language was of our choice, college had not bothered to set up the lab, then somehow we started, and they told we'd have 90minutes and then suddenly in 60minutes they came up and said okay we are done, now time to evaluate.
They rejected me because my code didn't compile, so nobody cares about your approach, it is like being in college where your architecture is shit, approach is shit, design is shit, we'll consider only when your code runs :D
I am happy I didn't get through. Also, for a company which looses crores of Rupees per year, it is a bad sign if they start using Mac books for development! Bootstrapping!