[carwatcher]

Originally Posted by jaaz

Bhpians - If you leave apart the Flipkart debacle, Which Online Store do you feel good and uncluttered ? The price changing strategy is also evident on Snapdeal on regular basis. Apart from Flipkart, Snapdeal & Amazon are there any other sites that are good and reliable for shopping Online ?

I shop on eBay and Shopclues also and have also purchased directly from company's websites like Bata and Puma. Rediff and Indiatimes shopping also comes to my mind. But yes, I am also looking for other alternatives continuously.

[amanomics]

Reply to Bansal's apology email by one of the many frustrated members:
http://missionsharingknowledge.com/o...pkart-bansals/

[binand]

Originally Posted by binand

- Charge entry fee (adjusted against final purchase) to the store, to cover overheads.

First of all, I was not saying this is exactly what the B&M store owner should do. I am not their consultant.

Second - you are probably guessing here. The huge number of tradeshows and malls and other kind of activities that organize sales but require an entry fee (these keep happening all over India) proves that this model works. Now to get it working to a specific scenario, it is up to the business owner.

Originally Posted by binand

- Make sure that the customer orders from HIS online store (say, by way of a discount code).

Ultimately, the business owner will realize two things:

- He cannot compete with online on price. He has to provide increased value addition for the premium he is forced to charge. Touch-and-feel is one common way. In-store demo and installation support is another. Instant gratification could be a third. And so on - there can be a lot many more options. For other goods, online is simply a cheaper way of selling and those have to move there.

- He cannot expect to force his customers to adapt to his way of doing business. For any business to survive, it has to adapt to changing customer preferences, not the other way round. A company called International Business Machines redefined what a business machine is, over the course of its 100+ years of existence to stay relevant. It did not run to regulators when its whole product lines went obsolete - it instead came up with new products and new lines of business.

Originally Posted by binand

- Provide the same benefits as ordering online. If the customer is in HIS store already, why does she need to go online to order? Provide home delivery and COD. Or easy returns.

So as I said, it is simply a more expensive way of doing business. Either abandon it, or take a hit on the margin, or reduce costs elsewhere. Business 101.

Originally Posted by Trust_In_Thrust

What i would like to understand how Flipkart , Snapdeal etc are able to sell goods wherein OEM's of the sold products refuse to honor warranty saying they are illegal imports in India. I know for sure among many JBL doesnot honour warranaty on goods bought online except there own store .This means these online firms are looting tax departments as these products they sell at such low prices first reduce sales of legal manufactured/imported goods in india and second do not pay any taxes to government .

There are many aspects here, without knowing specifics it is not easy to say which it is.

1. Online vendors are buying reburbished goods and passing them off as new. Manufacturers will obviously refuse to honour warranty on these.
2. Online vendors are buying genuine goods from distributors. Manufacturers are illegally refusing to honour warranty.

In the second case, there could be a cause for a complaint to the CCI. More so, if one can prove cartelization.

I'm not sure why you bring taxation into the picture. The sales tax, VAT and other applicable taxes are all included in the price, and I am yet to see an online vendor who didn't provide me with a tax invoice. Even the small-time vendors on Ebay do it. Where is the loot?

Originally Posted by Trust_In_Thrust

Also CCI probe is justified . What will happen if Amazon decides to offer 50% off MRP for say 1month..6month...1year , they have the resource to do it !It will literally wipe out market .What Flipkart is doing is just blowing VC funding improve market cap then probably list or being sold to global major . the owners cash out .

First of all, for CCI probe there is a condition of "dominant position". It will be tough to prove that Flipkart has a dominant position when numbers I see say retail in India is $400 billion and out of this, only $1.5 billion happens online.

Second point, Amazon does not have the resources, and its CEO does not have the control to offer 50% discount off MRP for all products for 1 month, 6 months, 1 year. This is a what-if scenario so much out in fantasy land that we can, well, discount it.

Third, if Flipkart is blowing VC funds then it is the VC's own fault. They have sufficient control over FK management's decisions (by all accounts, the acquisition of Myntra was forced upon Flipkart by VCs) so I'm sure FK had to run the Big Billion Day through them and they stamped their approval on it. Now it seems the Ministry of Commerce is getting involved. :-)

Originally Posted by Trust_In_Thrust

I know for sure there is block of 6mobile shops side by side where i stay and they fix prices (Now what can CCI do in this) !

Nothing. the CCI won't even bother. You need to prove dominant position. Are there no other mobile shops in town?

Originally Posted by carboy

It has Gorilla Glass which is more scratch proof than any scratch guard.

Lumia 925 has Gorilla Glass 2. Moto E has Gorilla Glass 3. The latter is a lot tougher than the former.

[giri1.8]

Originally Posted by amanomics

Reply to Bansal's apology email by one of the many frustrated members:
http://missionsharingknowledge.com/o...pkart-bansals/

I stopped reading that article when I read " This is exactly what happened with Flipkart and a lesser known site for online shopping till few weeks ago – Snapdeal"

Snapdeal ranks 12th in India in terms of traffic and 224 th in the world!

Source:http://www.alexa.com/

While I agree that Flipkart's sale has backfired due to their strategy to bring traffic to their website, many of the bloggers and news websites are using this opportunity to bring traffic to their respective websites/blogs(ironic).

One more thing I could notice is that most of the popular news websites, who themselves own online shopping websites similar to Flipkart are worried about the future of physical retailers(again ironic).

Best thing we could do about this situation is to make most out of it, while making sure that we are not taken for a ride.

[Saanil]

Was speaking to a friend of mine who is more knowledgeable than me on the current online retailing space. Below are some of the key points of that:

- Flipkart in the recent months has lost some ground to its competitors mainly Amazon.

- It is actually Amazon which is much more competitive/disruptive on prices than Flipkart. Prices of some products are cheaper because online retailers actually bear some part of the cost. Note that this is not true for all market players but only those vendors who are big and deal in big volumes. For example, if I am a big seller of laptops and if I want to sell a laptop for Rs 30k (which is the average price in B&M stores), the online partner will tell me to sell at Rs28k and pay me Rs2k separately.

- Flipkart's recent campaign was not a full on proper discount sale - there were discounts only on some products and that too were bought out very quickly. The upcoming sale by Amazon is said to be much better in terms of breadth of products.

- Flipkart's recent sale was kind of a hasty move to remain in the competition. Amazon have a clear thought out 2-3 year strategy and wanted to become Number 1 quickly.

- Currently all online ventures have one objective - increase customer base and make people addicted to online shopping.

- In urban cities, B&M shops will find it really hard to compete in coming years. They will need to think of some other strategy to counter online frenzy.

While I cannot guarantee the accuracy of these statements, I think all of it seems quite logical. All in all, exciting time for consumers ahead!

[driverace]

Originally Posted by Kumar R

Why should prices not keep on decreasing ..
or have we become so cynical that we resist such a thing?
..
Consumerism may be frightening, I agree ..
- but living responsibly means doing everything in moderation and knowing one's limits,..
..
Why feel horrible? FK is not into charity, they are sellers for profit; if they succeeded (without coercion or fraud) in influencing responsible adult men and women sitting on computer terminals thousands of km away to buy all kinds of rubbish that they don't need, kudos to them...

Wow, your post exactly echoes my thoughts on all of this scene!
And, you have so clearly explained it with theory & examples.

Could you please share your thoughts on what this sale does for FK:

Flipkarts gains:
Short term (600 Cr.)
Selling way more "regular" priced stuff to people who logged in to buy something they "needed" but ended up buying something that "looked good"
New customers, publicity.
stock clearance(?)

Flipkart losses:
a very fractional loss of selling few items in steal deals
Perhaps- some warning from Govt. / threats from offline retailers
Some customers may be turned away (due to the confusion day)

Originally Posted by giri1.8

I stopped reading that article when I read " This is exactly what happened with Flipkart and a lesser known site for online shopping till few weeks ago – Snapdeal"

Snapdeal ranks 12th in India in terms of traffic and 224 th in the world!

Source:http://www.alexa.com/
..

I didn't get your point. Could you please explain what you meant there?

Originally Posted by Saanil

Was speaking to a friend of mine who is more knowledgeable than me on the current online retailing space. Below are some of the key points of that:

- Flipkart in the recent months has lost some ground to its competitors mainly Amazon.

Is that true? I perceived - Flipkart to be a much younger venture with it's own place in Indian market.
Amazon - no doubt is a giant powered with ample backing from "outside".

Although, now, that I think of it - they do sell almost the same categories & are each others alternates (among most online shoppers I know).

The upcoming sale by Amazon is said to be much better in terms of breadth of products.
..

I really hope so!
I have a small shopping list here & limited funds to put checks on that

- In urban cities, B&M shops will find it really hard to compete in coming years. They will need to think of some other strategy to counter online frenzy.
.. I think all of it seems quite logical. All in all, exciting time for consumers ahead!

If you take a look at shops (at least) in Pune - I am sure you will agree, that (majority of) these folks need a reality check.
For that matter wherever - in offline retail shops,
customer is on least priority, this 'threat' needs to deliver the right message.

I am really tired of getting irritated of the attitude some of the shops/offline retailers have.
Don't get me wrong, I really support the friendly offline B&M stores.
I really really appreciate the willingness to deliver & help the customer - as in most of Mumbai shops/stores (that I have seen so far)!

Last couple of pages has helped me understand different views & perspectives on the existing "online retail" scene!
This is really interesting.

Thanks to all,

Ace.

[binand]

Originally Posted by Saanil

- Flipkart in the recent months has lost some ground to its competitors mainly Amazon.

- Flipkart's recent sale was kind of a hasty move to remain in the competition. Amazon have a clear thought out 2-3 year strategy and wanted to become Number 1 quickly.

Originally Posted by driverace

I perceived - Flipkart to be a much younger venture with it's own place in Indian market.
Amazon - no doubt is a giant powered with ample backing from "outside".

I have heard some numbers that seem to indicate that Amazon is indeed eating Flipkart's lunch. Apparently Amazon in what, a year of operation? - has achieved comparable levels of business that Flipkart took nearly 7 years to reach. That sort of growth might be troubling Flipkart.

Originally Posted by driverace

FK:[indent]Flipkarts gains:
Short term (600 Cr.)

I think this 600 crores you refer to is the same "$100 million of GMV" that Flipkart put out in a press release. You should remember that GMV is not sales, that this number does not go into Flipkart's topline. It is the sum total of MRP of all merchandise sold on Flipkart on that day. Obviously the bulk of this money is meant for the people who put these merchandise up for sale in the first place. Assuming the margin is 10% (higher side, I should think), Flipkart made 60 Crores. I expect they spent a good 10-15 Crores on publicity for the event (full page ads in many national dailies etc.). So if the total cost of discounts they offered across the board is > 50 Crores, then they ended up making a loss on the Big Billion Day.

[driverace]

Originally Posted by binand

I have heard some numbers that seem to indicate that Amazon is indeed eating Flipkart's lunch. Apparently Amazon in what, a year of operation? - has achieved comparable levels of business that Flipkart took nearly 7 years to reach. That sort of growth might be troubling Flipkart.
..

I think this 600 crores you refer to is the same "$100 million of GMV" that Flipkart put out in a press release. ..
Flipkart made 60 Crores. I expect they spent a good 10-15 Crores on publicity for the event (full page ads in many national dailies etc.)..
So if the total cost of discounts they offered across the board is > 50 Crores, then they ended up making a loss on the Big Billion Day.

Ahh, point about FK Vs Amazon noted.

@ 600 Cr. - Yes, I intended to indicate the profit made with this sale (not assuming 600 Cr. as net gain) - sorry for the confusion.

Even if the net profit figure (after deduction of advertisements) is ~50Cr. still, how do you see that comparing with other heads in Gains/Losses?

What would this do to Flipkart in the coming quater / Year(s) to come?

Ace.

P.S. This is really getting interesting, hope this is not too much OT.

[rm_arjuna]

What FK did was all correct in terms of Promotion strategy to highlight their Billion $ sales achievement in year and wanting to grow more ect and also this coincided with Mr.Jeff Bezos visiting India and it was perfect moment to taunt your immediate competition , however where it all backfired was lousy handling of backend, numerous price changes , deleting orders, increasing mrps to highlight dubious discounts .

E-retail is here to stay and whatever ways these companies threaten to boycott this format is only temporary and they are also doing so only to buy time from B&M retailers .

End of the Day we customer will prevail

[amanomics]

BTW, taking Amazon's case, they don't make much profit either. Even after 20 yrs in operation, they have yet to report a meaningful profit!



Detailed analysis here

[ashwin.terminat]

Flipkart had reported losses of 281.4 Crore last year.

I guess this has to do with offering mouth watering prices that end up being lower than the purchase price. I also remember that Flipkart, currently valued at $7bn intends to reach a valuation of $100bn, until which time, they want to just increase their customer base and will be turning a blind eye to profits.

With VCs pumping in the funds, I guess this isn't completely impossible either.

But my only wonder is, for how long will they continue to bleed losses and when will the products they sell start returning profits. Also, how will the change in strategy from Flipkart affect the customer base that they will have built up until then.

Interesting time ahead.

With regard to the "Big Billion Day" though.

I saw in the newspaper a Samsung Galaxy Tab for Rs. 1390, a 16GB Pen Drive for Re. 1, a 2TB External HD for Rs. 600. Tempted, of course.

This was at 7:30AM. Half an hour before the frenzy began.

I immediately looked up the products and added them to my kart and my wishlist hoping to get them.

I kept checking back for updation of the prices and the second I saw the pen drive at Re. 1, I hit checkout.

And then magic happened!

All my items barring the tab were magically removed from the kart! Moreover, the Tab went out of stock immediately!

I am almost convinced that the pricing was just to increase traffic to the website and get people to buy something or the other.

Either way, their plan worked. But I was left with a sour taste in my mouth. And will be visiting Amazon first hereon and then Flipkart.

[binand]

Originally Posted by amanomics

BTW, taking Amazon's case, they don't make much profit either. Even after 20 yrs in operation, they have yet to report a meaningful profit!

Who wants (net) profit? It is quite the wrong metric to look at. See here:

https://www.google.com/finance?fstype=ii&q=NASDAQ:AMZN

I see Amazon's gross margin steadily increasing to 37% in 2013. And their R&D spend is now nearing 9%. And they are sitting on a cash pile of $12.5 billion. I see a behemoth company delivering consistent performance, investing in its own long-term prospects, a massive war chest, one that I'd be glad to invest in if I had the access and the funds. :-)

Looking at the stock performance, I can see that the rest of NASDAQ agrees with me. In this period (2010-14) the stock price has gone up 2.5x.

[pratyush6]

Really love Amazon's Customer Centric Business - and no matter what, if any product is listed on both and is even slightly expensive on Amazon, I always choose Amazon. I have had nightmares with Flipkart's customer care - they are a pain you know where..

Profitability: Amazon is the Wal-Mart of Online Sales - They want the customer visiting the website no matter what (footfalls in a Super Store). Many of us who are into heavy online shopping check the website for those deals everyday. We almost always buy things we do not need. Essentially the focus now lies on the customer, if you want to spend there is a shop open always.

So in reality I checked the Big Billion Sale and found nothing interesting, maybe I was checking too late - but was that unexpected from FK - No.

[RSR]

Originally Posted by pratyush6

Really love Amazon's Customer Centric Business - and no matter what, if any product is listed on both and is even slightly expensive on Amazon, I always choose Amazon.

I completely second that, especially on orders fulfilled by Amazon!

No false promises, no huge discounting gimmicks (decent discounts are always available), no spending on advertising blitzkriegs, no taunting/mocking the competition, good virtual infrastructure, customer support & logistics departments and a solid customer centric approach overall. Just plain old professionalism!

My only grouse with Amazon so far is that amazon.in is rather limited in terms of products available for sale (departments) when compared to amazon.com, but I hope this changes in the near future. I, for one, would love to shop for car spare parts, tools and accessories on amazon.in!

[phamilyman]

Originally Posted by pratyush6

Really love Amazon's Customer Centric Business - and no matter what, if any product is listed on both and is even slightly expensive on Amazon, I always choose Amazon. I have had nightmares with Flipkart's customer care - they are a pain you know where..

Profitability: Amazon is the Wal-Mart of Online Sales - They want the customer visiting the website no matter what (footfalls in a Super Store). Many of us who are into heavy online shopping check the website for those deals everyday. We almost always buy things we do not need. Essentially the focus now lies on the customer, if you want to spend there is a shop open always.

So in reality I checked the Big Billion Sale and found nothing interesting, maybe I was checking too late - but was that unexpected from FK - No.

Disagree man.

A couple of weeks ago, a friend's iphone 5 died.

Within the space of half an hour close to midnight, I saw the 5s price go from 34k with coupon (from croma) to 34k without coupon from some third party to 38k without coupon on Amazon.

in the morning it was in the 36k range or so again.

I have realized that every one of these companies is price gouging. You just get smart - use stuff like mysmart price - buy the one you see cheapest and get going.

I find the fuss on BBD overblown. Why are people getting so worked up? Will any of you NEVER EVER use FK again? I doubt.

Ultimately its a good company esp if buying from WSR - tomorrow if it offers you like 3-4% below the next best online store, or even at par, would you not buy from it? I would. I prefer WSR-FK over a small third party on amazon over most of ebay.

Ditto for snapdeal, even though I had a slightly crappy experience with them.

Ultimately 99% of us are deal hunters. And apologies not withtanding - we will go to whichever company gives us the best deal (and has a decent enough service), period.

I would've much rather wanted that FK do away with some of its crazy additive shipping charges (where amazon has an edge!!) instead of burning money in silly one-time tamashas like BBD. If they have to burn VC money, why not do it in a fashion that gets more lasting business than BBD?