E-commerce Archives - WebPro Technologies LLP

On May 9^th 2018 Walmart announced that,

Walmart will pay approximately $16 billion for an initial stake of approximately 77 percent in Flipkart.

The remainder of the business will be held by some of Flipkart’s existing shareholders, including Flipkart co-founder Binny Bansal, Tencent Holdings Limited, Tiger Global Management LLC and Microsoft Corp.

While the immediate focus will be on serving customers and growing the business, Walmart will support Flipkart’s ambition to transition into a publicly-listed, majority-owned subsidiary in the future.

About FlipKart:

Founded in 2007, Flipkart has led India’s eCommerce revolution. The company has grown rapidly and earned customer trust, leveraging a powerful technology foundation, including artificial intelligence, and emerging as a leader in electronics, large appliances, mobile and fashion and apparel.

In 2015 FlipKart had adopted an App only strategy and had shut down their website. But, they found it difficult to provide an efficient user experience and soon shifted to a website which combined the benefits of the App and website and called their Progressive Web App as FlipKart Lite.

The FlipKart PWA resulted in :

3X more time spent on site
40% higher re-engagement rate
70% greater conversion rate among those arriving via Add to Homescreen
3X lower data usage.

Some Major Commercial Reasons Walmart shared in their Investor Presentation are:

"India is one of the most attractive retail markets in the world, given its size and growth rate, and our investment is an opportunity to partner with the company that is leading transformation of e-commerce in the market," Walmart CEO Doug McMillon said in a statement.
Flipkart has 54 million active consumers, and with this influx of money it can double this base in short period of time.
Walmart commits to sustained job creation and investment in India which is one of the largest and fastest-growing economies in the world.
Flipkart’s supply chain arm, eKart, serves more than 800 cities, making 500,000 deliveries daily.
“Flipkart has established itself as a prominent player with a strong, entrepreneurial leadership team that is a good cultural fit with Walmart,” said Judith McKenna, president and chief executive officer of Walmart International.
Over the last 10 years, Flipkart has become a market leader by focusing on customer service, technology, supply chain and a broad assortment of products.
Walmart’s investment includes $2 billion of new equity funding, which will help Flipkart accelerate growth in the future.
While Walmart and Flipkart will leverage the combined strengths of both companies, they will maintain distinct brands and operating structures.

Indian e Commerce Market

The FlipKart – Walmart deal surely scales a major success graph for the Indian eCommerce start-up but, it also passes on the control of the online retail business in India to two large American companies – Walmart and Amazon.

Soon after this announcement Amazon is said to be in talks with India’s largest brick-and-mortar retail company Future Retail, to acquire a stake.

Future Retail is the retail arm of Kishore Biyani. Future Group, owns physical retail stores such as Big Bazaar and Easy Day.

“Future has consolidated the market. There are only three big retailers left: Reliance Retail, D-Mart and Future Retail… Future is an attractive target,” said Abneesh Roy, senior vice-president (research) at ‎Edelweiss Capital.

Roy added that Future and Amazon can be of use to each other. For example, Future Retail can learn from Amazon’s global sourcing business. On the other hand, Amazon in India can take the help of Future’s supply chain. Future Group has a fully-owned subsidiary called Future Supply Chain Solutions. It has a network of 46 distribution centres, which includes four temperature-controlled centres — spread out in a ‘hubs and branches’ model, covering 11,228 PIN codes.

Myntra a FlipKart Ltd. Unit acquires Jabong for $70 million. This deal has made FlipKart the no. 1 e-commerce market place. Jabong offers more than 1,500 international high-street brands, sports labels, Indian ethnic and designer labels and over 150,000 styles from more than 1,000 sellers. Flipkart, beat Snapdeal and Future Group in this deal, FlipKart will pay cash for the acquisition, according to a statement by Global Fashion Group (GFG), which owns Jabong. In September 2014, German investor Rocket Internet merged Jabong with four other online fashion retailers in Latin America, Russia, the Middle East, South-east Asia and Australia to create GFG. jabong-myntra

Sachin Bansal and Binny Bansal, Flipkart's co-founders, confirmed the news by tweeting:

Welcome @JabongIndia to the @Flipkart family. We'll create history together.
— Sachin Bansal (@_sachinbansal) July 26, 2016

Today, @Myntra got bigger! Delighted to welcome @JabongIndia to the @Flipkart group! — binnybansal (@binnybansal) July 26, 2016

Since last one year the sales of Jabong.com owned had been declining and they had stopped offering discounts to reduce its losses to Rs 46.7 crore in 2015 from Rs 159.5 crore in 2014. In 2015 jabong.com was almost sold to Amazon but the deal did not get finalized. “Through the sale of Jabong, we are achieving a milestone in our strategy to refocus and invest in our core markets that show both, significant growth and revenue potential but also a clear and predictable path to profitability,” GFG CEO Romain Voog said in a statement. Binny Bansal, co-founder of Flipkart said: “Fashion and lifestyle is one of the biggest drivers of e-commerce growth in India. We have always believed in the fashion and lifestyle segment and Myntra’s strong performance has reinforced this faith. This acquisition is a continuation of the group’s journey to transform commerce in India. I am happy that we will now be able to offer to millions of customers a wide variety of styles, products and a broad assortment of global as well as Indian brands,” he added. For now Myntra has said it will keep Jabong as a separate entity. This deal strengthens the Bengaluru-based company's prospects of competing with Amazon a in this high-margin business. Welcoming Jabong to the group, Flipkart CEO Binny Bansal sent a letter to all its employees. Here's the text of the letter sent by Bansal: Hi, I am happy to inform you that our group company, Myntra, today acquired Jabong from Global Fashion Group, thus creating India's biggest fashion shopping destination.The acquisition of Jabong further strengthens Flipkart Group's position as the undisputed leader in Fashion and Lifestyle segment in India. As you are aware, Jabong is among India's major fashion multi-brand e-store with more than 1500 on-trend international high-street brands, sports labels, Indian ethnic and designer labels and over 150,000 styles from over a thousand sellers. Myntra and Jabong are all set to define the next generation of online shopping offering the best of brands to Indian consumers.Some of the most iconic global brands that will be exclusive to both the platforms include Dorothy Perkins, Topshop, Tom Tailor, G Raw Star, Bugatti Shoes, The North Face, Forever 21, Swarovski, Timberland and Lacoste. Fashion and lifestyle is one of the biggest drivers of ecommerce growth in India. We have always believed in the fashion and lifestyle segment and Myntra's strong performance has reinforced this faith. This acquisition is a continuation of the group's journey to transform commerce in India. I am happy that we will now be able to offer to millions of customers across our 3 platforms even more wider variety of styles, products and a broad assortment of global as well as Indian brands. Ananth will be leading both Myntra and Jabong platforms. Please join me in welcoming the talented team of Jabong to the Flipkart group. It's an interesting coincidence that Myntra's announcement coincides with the launch of Amazon Prime in India. But, Flipkart already has a Prime like service available in the form of Flipkart First. This provides free shipping and other benefits, much like Amazon Prime.

While Shopping online the main concern of the online buyer is the security of the credit/debit card details being shared online. In order to make the online transactions more safe and secure Euronet, an e-payment services provider, will now provide bank customers a digital code, which will enable them to make online purchases without disclosing their card details or logging on to net banking.Just as you receive a code via SMS or email on mobile top-ups and DTH recharges to execute the transaction a code will be sent as an SMS or e-mail to the beneficiary.

Euronet is a global provider of electronic payment and transaction processing solutions for financial institutions, retailers, service providers and individual consumers through three primary business segments — Electronic Financial Transactions, Prepaid and Money Transfer.

Himanshu Pujara, MD, Euronet Services India said “The customer can buy a digital code online or in the retail market across the counter, and the SMS or the physical card acts as a store of value which is then activated at the merchant bill,”

I think it is a very good option for the online retailers and buyers and as the online market in India and worldwide is increasing in volume a direct increase in such transactions also is a possibility.

As per an article in Business Line Pujara added “Since India is growing, indicators suggest we are ready for this, but volumes need to be seen. Also, competition is huge. So we are trying to work on the differentiation, margins, integration with e-commerce firms and attempting to tie up with local brands too”.

Author : Bharati Ahuja

Deciding how to sell online becomes more difficult than deciding what to sell online. There are multiple options available that tend to confuse a newbie in the online business. An online marketplace (or online e-commerce marketplace) is a type of e-commerce site where product and inventory information is provided by multiple third parties, whereas transactions are processed by the marketplace operator.

Examples of online marketplaces are eBay, Snapdeal, Flipkart, and Amazon

Lately I have observed that many people after working on their eCommerce sites soon lose patience and start focusing on online marketing places and neglect their own eCommerce websites.

No doubt online marketplace is a much easier way of setting up an online store, you don't need any technical assistance, you don't have to brainstorm about the design and you don't have to bother about sales transactions; basically everything is spoon fed. All you need to do is list your products, receive traffic without much effort and pay a commission or fee to your marketplace. A very tempting and convenient 'short cut' to selling online.

This according to me is taking the shortcut to online success which in the long run may not be beneficial, as instead of working on your website you rent out a space to showcase your goods to win the online race. I correlate this to the story of the “Hare And The Tortoise” where the hare plans to take a nap as it thought that the tortoise is too slow and will be able to manage to cross the finish line and win the race even at the last moment .

I think winning the online race is not only about how much profit you are making currently but also about establishing your brand and also about having an owned presence which in the long run proves to be a digital asset which has a potential of an increasing ROI.

Just focusing on the online marketing places is like constructing a building without a firm foundation.

But, yes to start off online and gain quality web and search presence to drive traffic to your website is a daunting task and requires regular investment of time and money, which many times make the website owners shift to already established online market places like Amazon and eBay. But we need to understand that these websites too had to go a long waiting period and a period of constant struggle and patience to reach where they are today.

When you opt for the already established online market or bidding sites you do gain an immediate presence and you may be in business from day one but on the other hand you lose out on establishing your own brand and website (Owned Presence) which you may need to fall back on if your presence on the other rented sites gets adversely affected. This can happen due to various reasons like, fluctuations in the market, the market site losing popularity, gets adversely affected by the Google algorithm updates and loses search presence, etc.

The best option I think is the optimum utilization of resources to establish a presence on both the platforms. Establishing your own eCommerce site and having a presence on the online market sites are equally important. Else it is like having a good presence at the real time exhibitions and conferences but not having your own shop or office. Online marketplaces, are a great way of understanding how e-commerce works. But if you want your business to flourish as per your rules, with a brand identity and with long term plans, then there is no other way than having your own website.

In general, because marketplaces aggregate products from a wide array of providers, selection is usually more wide, availability is higher, and prices are more competitive than in vendor-specific online retail stores. As many marketplaces cross-promote the items of other merchants along side of your items. In many cases, they even compare prices. Therefore, if your competitor is offering the same item at a lower price, they may end up making what was supposed to be your sale.

The Indian Ecommerce Industry today maybe in nascent stage today but has the positive potential of an amplified growth in the near future.It is changing the way businesses are done and sowing the seeds for a whole new economy. Rising incomes and a greater variety of goods and services that can be bought over the internet is making buying online more attractive and convenient for consumers all over the country. The internet is opening up new avenues for the people in rural India which is changing the lifestyles, the quantity and quality of consumption which is helping change mindsets in the rural areas.

A quick glance at the eBay India Census 2012 report indicates that e-commerce is here to stay. eBay Census 2012 research findings were based on an analysis of all online buying and selling transactions by Indians on eBay between July 1, 2011 and December 31, 2012. At eBay India today, every one minute a mobile accessory changes hands and every two minutes a mobile handset. It has 4,306 e-commerce hubs today, of which 1,015 are hubs in rural India, indicating that consumers in the smaller towns of India are a major force in this online growth story.

According to IBEF (Indian Brand And Equity Foundation) The sector is classified into four major types, based on the parties involved in the transactions –

Business-to-Business (B2B)
Business-to-Customer (B2C)
Customer-to-Business (C2B) and
Customer-to-Customer (C2C)

According to an Internet and Mobile Association of India (IAMAI) report, the overall e-commerce market in India has recorded a robust CAGR (Componded Annual Growth Rate) of 54.6 per cent and crossed USD10.0 billion during 2007–11. It is estimated to add another USD4 billion and reach USD14 billion by end-2012. Segment-wise, B2C dominated the sector with a 56.0 per cent share in 2010–11. Together, the B2C-C2C segments have shown significant growth; their aggregate market size stood at USD9.9 billion in 2011, while that for B2B segment was estimated at around USD48.8million. However, B2B’s acceptance is on an upward trend due to its rising awareness amongst Small and Medium Enterprises (SMEs), which are close to 13 million in number.

The United Nations estimates that just 31% of India’s population lives in urban areas, compared to 50% in China, 74% in Russia and 85% in Brazil. As a result, sales from consumers outside of metropolitan areas already make up half of total sales at some leading online retailers in India.

Flipkart today is valued at Rs1,000 crore, and speculation is rife that the e-firm, in fact, is worth at Rs5,000 crore. It recently raised $20 million. Other Indian players – Myntra, Jabong, India Plaza and Junglee – are also eating into the e-commerce pie.

Notably as can be seen in the image below, on the investment front, the sector enjoyed inflow of around USD800 million in 2011, up from USD110 million in 2010. Investments made in e-commerce businesses by PE firms alone more than quadrupled to USD467 million in 2011 compared to USD99 million in 2010. The number of deals increased to 78 compared to just 22 in 2010. The robust deal activity continued in 2012, with USD242 million invested during the January-April period. The trend over the period reflects that the average deal size has more than doubled due to increasing traction in e-commerce activities, which requires larger investments for growth.

However, the major issues which the ecommerce companies face are as follows:

1. The challenge of having a good distribution network but many ecommerce giants are developing their own distribution networks as delivering charges form a major component of the product cost – ranging between USD1.0–4.0 per item.

2. The huge investment made in ecommerce ventures has the potential to give beneficial returns in the long run only if the customer base increases.

3. The turn around time for delivering a product can be reduced to 1-2 days only if the distribution system is improved and this also will help retain old customers and add to the list of new customers.

4. Retaining an existing customer is more profitable for a company since acquiring a new customer; on average costs USD15.0–20.0.

5. Only the ones who can face these issues and retain customers and survive online can get a piece of the pie of the online market as fundamentally weaker companies would lose out to established players . Hence a focus on improving the distribution system and retaining the existing customers is the key to ecommerce success.

On an average day on eBay in India:

According to a study by Forrester , India is expected to record the highest growth in the Asia Pacific region during 2012–16. The trend would shift with the online retail segment contributing equally to the total market size, considering it is expected to grow significantly in the coming years. The B2C segment would continue to lead the e-commerce market, thanks to the budding Indian Internet population, supporting demographics, ease of payment modes and customer-centric innovative policies.

Author : Bharati Ahuja

TESCO has been adjusting to the local Korean market and had to compete with the numero uno company in Korea that is Emart .

For this they had to find an answer to the question - Could we become no. 1 without increasing the no. of stores?

And they did find a unique, enterprising innovative answer which has brought them to the 2nd position in Korea.

View the video for the answer:

Main Takeaway:

Don’t wait for people to come to your store or wait for them to find you on the internet and search engines. Go one step ahead and take the store to the people.

Make it available wherever you think people can squeeze in some time to use their smart phones to shop.

Don't wait for them to find and search for your store. Create Virtual Stores to blend into their everyday lives.

A true blend of virtual and real time life.

Innovative Indeed.

Guest Post

What’s the first thing you do when you start a new site? Pick a niche. Well my niche is ecommerce, granted it’s a little broader than what you would typically expect but the one thing that I’ve always found strange about affiliate sites is that you build the site and optimise it to attract visitors and once they get to your site your trying to push them off your site and onto the merchants. Now I’m not trying to put the boot into affiliates and I’ve made a lot of money from these sites and they help to pay a lot of peoples wages but for me when I get a visitor to my site I want to keep them there as long as possible and still make money from them. With a web shop I can do that.

A webshop is a different breed of site and to make one work there needs to be a lot going on in the back ground, things that the customer will never see. Stock control, warehousing, dispatch and staffing are all key elements to running a successful web shop. There is little difference between running a web store and running a shop, you still need to deal with useless suppliers and you will always have the problem of keeping your customers happy, but to me these are just par for the course and I have found the more of these types of sites I set up the smoother I can make the backend process.

The web is a competitive place and it seems that with a lot of the industries I’m currently in it’s just a race to the bottom on price, who can be the lowest and still make money and this isn’t something that’s going away, so we either need to differentiate ourselves from the rest of our competition, or we can lead that race to the bottom and either tighten things on the back end or shift more products. The words “box shift” springs to mind.

Now before I completely put you off ecommerce sites let’s talk about the good things and why I have spent years learning to build these into successful businesses.

Dropship is word that warms my heart it takes away a lot of the hassle with the back end and in the industries were these work best you are more or less working as an affiliate for the drop shipper, margins will be effected so just make sure you pick an industry where price isn’t necessarily the driving factor behind a sale and in time holding the stock your self will allow you to increase margins.

Now this is where there more traditional web marketing comes into play. Many people believe that building links to an ecommerce site is one of the hardest things to do and they may be right, but I see this as a good thing, if you are a better link builder then your competitor then you can beat them. If you can write better copy then your competitors you can drive more sales, in most cases this isn’t hard to do as they just copy the product description from the manufacturer’s sites. Why not get an army of affiliates to work for you, we already know what they look for in a good offer so why not give it to them and let them drive sales for you.

I think the idea of running a webshop has a stigma attached to it but there really isn’t that much to it, if you believe that you have what it takes to drive traffic to the site then you’ve got a good foundation to running a successful ecommerce store and you’ll find that everything else will fall into place after that, there is a lot of trial and error involved in the early stages of any business but this is where we learn from our mistakes and build on our successes. Well I hope there is something here that will help you make the move to ecommerce and all the great things that go with it.

Author Byline:

This is a guest post by Neil Jones, head of marketing for eMobileScan a leading providers of bar code scanner and barcode printers, including the Zebra GK420D