Amazon vs FlipKart vs Snapdeal, their DNA and where is this eCommerce showdown headed for?

We are all familiar with Microsoft Excel as “the spreadsheet program”. However, do you know that it wasn’t Gates or his company that invented the spreadsheet programs? The first such tool (& a revolutionary one at that) was VisiCalc. VisiCalc gathered all the well-deserved hype for some years but as the spreadsheets and their utility was getting established, it was overtaken by Lotus 123. Lotus did enjoyed a bit more extended run at the top, it created thousands of spreadsheet users and perhaps millions of businesses problems were solved using it. Still, did it receive the real benefit of creating this whole new business category? NO, it was Microsoft and its more user friendly tool (although heavily deriving the main functionalities from VisiCalc & Lotus 123) that eventually established itself as the market leader. Microsoft has sold millions of its copies in last 2 & a half decades and continues to dominate the spreadsheet business.

This story clearly establishes that category inventor, category creator and category dominator could very well be three different companies.

Closer home, in online classified field, Sulekha Classified was the buzzing name some 8 years back. But then, more nimble, cash rich, focused and technically superior players came and they just pushed the early mover/incumbent out of picture.

Here also, Sulekha Classified created awareness of the possibility of such transactions for more than 5 years, and just when the business picked up and some monetization seemed possible, it had to relinquish the space to OLX & Quikrs’ of the world.

 

Now coming to the current eCommerce (or e MarketPlace, as the players would like this to be called) scene in India, FlipKart is clearly the category inventor in India (though they themselves were inspired by Amazon)

FlipKart started as a pure online book seller with somewhat modest aspiration. This modesty of thought is revealed if you look at the site’s scope, look and scale in the initial years. It was a site that used “over 1 lakh books to choose from” as one of its biggest USP, and geeks/students were perhaps its first adopters in India.

This is how the site has transformed in last 6 years:

Flipkart 2008 to 2014Flipkart 2008 to 2014

Calling it as a path-breaking inventor will be wrong. eCommerce as an Idea was already about a decade old, in India also FlipKart rode on the initial work done by many other entities like the IRCTC and the travel companies like MMT(Who taught some of us the online payment concept).

But FlipKart played a major role in creating this concept of eRetail in India. Deep discounted books (where offline retailers were allergic to this concept of discount on printed MRP), delivered to one’s doorstep, packed with layers of bubble wrap sheets in mint condition and zero delivery charges was a potent combination. Add Cash on Delivery to this, and they removed the last barrier as well. After establishing the business model and experiencing an overwhelming response, they were quick to add Music CDs and then Mobiles to the assortment.

Selling Mobile sets was a big leap. Will anyone buy such high price items online? Without even seeing the item? However, as it turned out, mobiles make perfect online shopping items. You can experience a mobile if your friend has it, or perhaps at some physical store, and then even a 10% online discount could result in a significant savings. FlipKart obviously discovered many such patterns, refined its front-end site, and heavily invested in technology, infrastructure and talent.

But more than anything it introduced the eRetail experience to a millions of early adopters in India. It braved the insane logistics costs (due to very low initial volumes), abrupt product returns, non-payment of Cash-on-Delivery orders, suspecting government officials and many such challenges to establish a new business model in India. 

In due course it had to burn a lot of cash to sustain the momentum. It is an open secret that all major eCommerce companies in India are in red and have been so since inception. The discounts, free deliveries, promotions, customer acquisitions, infrastructure.. all come at a price. FlipKart kept on burning (PE) money and simultaneously kept on growing at a breathtaking pace, resulting in a situation where their valuation grew at a much faster rate than whatever cash they could burn, no matter how hard they tried. And they indeed tried really hard! From being an unknown startup to being a top advertiser on Indian TV, from being a 2 person company to be recruiting in droves from the leading tech & business schools, from a small office in Bangalore to creating a solid distribution network in India, they have spent money as if there is no tomorrow. Irrespective of what eventually happens in this fight for supremacy among these players, a chapter will always be dedicated to the FlipKart phenomena in all the books that will be written about the eCommerce evolution in India.

Post the new policy overdrive in the retail space and a clear negative policy stand on FDI in eCommerce space, FlipKart was forced to hive-off its fulfillment company and had to convert the parent company into a pure play marketplace. (What is an eCommerce Marketplace? Marketplace model says that the eCommerce site becomes just a technology platform where any seller can sell goods to its customers, so the site carries no inventory and is technically not involved in any retailing activities itself, and thus can have FDI without violating the current regulations)

In the current environment, the biggest challenge that FlipKart faces lies in differentiating itself in terms of superior assortment & service. Threats will come from the following three types of competitors:

-          Companies that play in their own niche (firstcry/jabong/pepperfry & so on)

-          Well-funded competitors that will quickly match(or beat) assortment & vendor relations

-          Deep pocketed giants .. umm.. I mean the elephant in the room .. Amazon!

There is going to be a long spell of profit-less ultra-growth phase in India. We hope that the company that has steered the industry till now will remain at the top of its game to fiercely compete in this segment and will not become a VisCalc or a Sulekha.

 

SnapDeal was a pure play deal/coupon site even just 3 years back. Compared to the current Snapdeal site, below given snapshot from January 2012 could very well belong to a completely different company:

Snapdeal 2011 to 2014: Snapdeal transition from deal site to ecommerce marketplaceSnapdeal 2011 to 2014: Snapdeal transition from deal site to ecommerce marketplace

Then in what could very well turn out to be a history defining move by any businessmen in recent past, Kunal Bahl swiftly transformed his business to a marketplace for physical goods. The journey from a wannabe Groupon to a wannabe Amazon took barely 3 months. To Snapdeal’s credit, within 3 years it has been able to come to the lead pack of this highly competitive industry. The good thing about Snapdeal is that apart from that somersault in 2012, it has always looked in control of what it is doing.

Kunal comes across as a very articulate business head, someone who has a vision, game plan and is in control. Snapdeal’s strategy till 2013 can very well be explained with the drafting technique that cyclists and marathon runners (to some extent) use. In such races, someone can get right behind a strong competitor and avoid a lot of air friction, and save that valuable energy for the very last lap. The technique is all about letting a competitor burn his energy for your benefit. Snapdeal, to some extent occupied that drafting stance behind FlipKart for most of its existence. While FlipKart toiled hard to create the eco-system, educate the customers and build trust around eRetail, Snapdeal kept a low profile, focusing more on the business side of it.

This focus has seen Snapdeal surpass FlipKart in terms of assortment(at least in count) and numbers of sellers on board. Unlike FlipKart, Snapdeal was designed to be a marketplace from the very beginning. This had its advantages in-terms of low capital involvement and easy scalability, but on the flipside it was always wee on the execution side. Snapdeal’s biggest challenge will be to maintain service standards while working with a huge and diverse set of sellers.

A long term risk for Snapdeal will be a policy change in favour of FDI in eCommerce space. FlipKart & Amazon, with their physical delivery know-hows and deep pockets are likely to kill all competitors who rely purely on marketplace model. 

 

Amazon was keen on an Indian entry for quite some time now. It has suffered an inglorious existence in China for almost a decade and needs a foothold in rapidly growing eCommerce like India. A muddled Policy has not helped the company as it has watched the industry’s explosive growth from the sidelines.

It eventually decided to test waters with Junglee.com and then finally bit the bullet by opting for a marketplace model to manage within the current regulations.

The global brand, best in class domain knowledge (after all they are the big daddy of global ecommerce), superior vendor relations (& bargaining power) and the very deep pockets mean that on a level playing field, Amazon will be a serious contender for the top slot in Indian ecommerce space.

Amazon IndiaAmazon India

Jeff Bezos thinks way ahead of others when it comes to customer needs and future of the industry. Amazon’s customer service obsession in itself is the biggest differentiator. Moreover Amazon’s India operation will have the luxury to continue their pursuit of customers’ happiness without the over eager investors breathing down its neck.

So who will rule the Indian eCommerce space 5 years from now? How will the 4G data explosion, a potential economic upswing and fierce attention on local procurement will shape the industry and the current competition? Please share your views.

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air jordan pas cher L’Espagnol a, sur la pointe des pieds, réussi son retour à la compétition à BuenosAires. Mais le plus dur reste à venir, restaurer la confiance et rendre son jeu plus percutant. Vaste chantier.Retour gagnant. Pas encore convaincant. Rafael Nadal, un peu rouillé, a retrouvé le chemin de la victoire au 2e tour du tournoi de Buenos Aires contre Juan Monaco, une de ses victimes favorites sur le circuit (l’Espagnol n’a perdu qu’un de leurs 7 duels, et depuis 2011 n’a laissé filer que 12 jeux en 10 sets). Une fois la satisfaction attachée à sa 5e victoire de la saison évacuée, le 5e joueur mondial (qui n’avait plus joué depuis son élimination au 1er tour de l’Open d’Australie, contre Fernando Verdasco) a résumé : «Le court n’était pas lent, ni les balles lourdes. Durant le match j’ai dû faire appel au médecin pour des douleurs à l’estomac.»

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[url=http://www.omcrofr.com]nike air max[/url] peut observer les surpiqures aux extrémités, ainsi que des lacets en coton ciré (présents sur l’ensemble de la collection).La semelle est basée sur le même principe que la Cyrus.Ce genre de détails rajoute de la luminosité au modèle et ravive l’ensemble de la tenue que l’on peut porter avec. Elle reste une pièce forte de par ce jeu de matières et de couleurs.Ici par exemple je porte ce modèle avec un chino bleu marine et un blazer gris (et avec le sourire en plus !).J’aime beaucoup cette paire de richelieu. Le bleu clair est encore plus lumineux avec le velours utilisé.a aurait pu être une simple paire de souliers en velours si le créateur n’avait pas rajouté ces pièces de veau aniline marron (on remarque la double piqure nette et régulière sur le cuir) qui donne l’illusion d’un derby (ou Molière). Pour info un veau aniline est un veau ? pleine fleur ? c’est à dire que le cuir est gardé dans un état brut. http://www.omcrofr.com omptez 330€ pour ce modèle.

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air jordan pas cher through a slow and controlled but an increasing range of motion. This process allows the muscles to gradually adapt to strenuous physical activity. It helps lessen the risk of developing strain and soreness in the muscles used.    Flexibility exercises can also help improve blood circulation. Regular stretching exercises not only help improve the body's muscle tone. It can also help increase the blood that is circulating through them. With an improved blood circulation in the muscles, there are several things that happen. First, the improved blood circulation helps the nutrients to be transported in the tissues more efficiently and nourish the muscles. Another thing that happens with improved blood circulation is that more oxygen gets into the muscles to fuel it through physical exertion.   A regular flexibility and stretching exercises and training can also help increase the production of synovial fluid in the joints. This fluid that is found in the joints acts as the joints lubricating fluid that lessens the friction between the joint's moving parts. Aside from that, the synovial fluid also helps transport the nutrients into the joint tissues.

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timberland pas cher from footwear, clothing, apparels along with other accessories and caters to both genders and age levels. Majority of the products of Footlocker came from Nike and their top sellers were Nike Casual Shoes, Nike Basketball Footwear and Nike Air Max. Other leading manufacturers also like Jordan footwear, Adidas Basketball Shoes, Adidas Originals, and Timberland Casual Footwear can also be found within the Footlocker's catalog. Similar to other athletic retail stores, Footlocker doesn't focuses only on athletic shoes, Footlocker really offers all types of manufacturers and all kinds of categories, from hiking to fashion and their eCommerce site Footlocker.com which is a portal of various brands and items. Footlocker also provides Fan gears such as NFL products and well-known sports team clothing, shoes and apparels memorabilia like World Cup and also the NBA. The WebsiteFootlocker may be the ecommerce website from the giant retail store Footlocker.

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