7 Ps in the marketing mix of Flipkart

Author- | Posted- | Updated: September 27, 2020 |

A brief introduction to Flipkart ( Indian e-commerce website)

Flipkart is an Indian E-commerce website that was launched in 2007 by two IIT alumnus named Sachin Bansal and Binny Bansal, who formerly worked for the international e-commerce brand Amazon. Like Amazon, Flipkart also started with selling books and slowly expanded the line of products sold on its website to include music, movies, and mobiles within three years of its launch. The company has its headquarters in Bangalore, Karnataka, India. In its short lifespan, Flipkart also made several acquisitions, of which the most notable one was Myntra.com. Myntra is an online fashion and home furnishing brand. Since it was founded, Flipkart has expanded its product line and distribution capabilities to strengthen its position in the Indian market enormously. The growth of the Indian economy and growing use of the internet and e-commerce in India have also helped Flipkart find faster growth in the local market. It is the biggest rival of Amazon India. However, Walmart acquired a majority stake in Flipkart in 2019. According to sources, the stake of Walmart in Flipkart is now 81.3%, which stood at 77% in the beginning. Other equity stakeholders in Flipkart include Tencent Holdings, Tiger Global, Binny Bansal (founder), Microsoft, Accel, Iconiq Capital, Temasek, and UBS. Following Walmart, Tencent Holdings had the largest stake in Flipkart, according to the report above 5%. Sachin Bansal exited Flipkart following the acquisition by Walmart while Binny Bansal continues to serve the company. 

In the last few years, the e-commerce brand has enjoyed strong growth in popularity driven by its excellent marketing strategy and its use of seasonal sales. Price savvy Indian consumers are in love with its sales and discounts which continues to drive faster growth in the number of registered members of the website. The Flipkart ecosystem also includes Myntra and Phonepe, a digital payments platform. Flipkart has developed into a multifaceted brand in the Indian market that does not just offer e-commerce services throughout India but is also a sign of the advancement of India’s digital economy.

The target market of Flipkart mainly includes young and middle-aged customers. The company offers an extensive range of products for various classes of consumers. Apart from a broad range of competitively priced products targeted at middle-class Indian consumers, it also provides a broad range of electronics and fashion products for the upper-middle class and the upper-class Indian consumers. The brand targets young and tech-savvy customers mainly and has been able to find massive popularity among the urban male and female customers, including professionals and small business owners. In recent years, its focus on rural consumers has grown. The company is slowly increasing its penetration of the rural Indian market where a broad base of smartphone-using customers exists. Growing digitalization across India has led to a growth in the number of tech-savvy consumers in the suburban and rural areas of India. Increased smartphone usage among middle-class consumers in rural India has also expanded Flipkart’s customer base there.

Read more about Flipkart in this marketing mix including the seven Ps.

Product:

Flipkart entered the e-commerce market as a bookseller but widened its product mix to include music, movies, and mobiles within three years. Over the years, it has continued to grow its product mix. The company has extended its portfolio through acquisitions, including Myntra. Flipkart sells more than 80 million products on its digital marketplace in more than 80 categories. The main product categories include electronics, televisions and home appliances, men’s products (including fashion products, footwear, and accessories), products for women, babies and kids, as well as home furnishing products and grocery apart from other product categories like sports-related products, books, auto accessories, and fitness products. Flipkart is the largest online retailer in the Indian e-commerce market that enjoys a larger market share than Amazon India at 31.9% (S&PGlobal). While Amazon is not very far behind with a market share of 31.2%, Flipkart’s popularity in specific product segments like electronics and home appliances is very high.  There are 100 thousand sellers that sell their products online on Flipkart. You can imagine the scale of sales from the number of page visits on the Flipkart website and app as well as the number of registered users on the web site. Every day, the website and app receive 10 million page visits, and there are 100 million registered users on Flipkart. The website had crossed the milestone of 100 million registered users in 2016 only. 

Apart from selling products on its e-commerce sites including Flipkart, Myntra, and Jabong, the brand also offers services like flight bookings as well as online payments. Phonepe is a payment app used widely across India and is among the top ten trusted payment solutions. Its main rivals include Google Pay and Paytm. However, Google Pay and PhonePe are among the most used digital payment solutions in India whose popularity grew faster following the demonetization. PhonePe launched its switch platform in 2018 from which users can place orders across over 200 apps including taxi, train, and flight booking apps. It introduced a nice range of insurance products also to grow its user base which is already above 230 million. Flipkart’s range of financial services has grown larger by the addition of these services to PhonePe’s services mix. In the future, Flipkart aspires to become the most comprehensive financial services platform in India. Phone Pe has partnered with leading players in the insurance and mutual funds sectors to widen its range of financial services and gain stronger footing as an online provider of financial services. Flipkart continues to grow its range of services in order to balance its portfolio of products and services. 

Place:

Flipkart’s business spans entire India and the company has established an efficient distribution channel that apart from tier 1, 2, and 3 cities in India also delivers to smaller towns as well as rural areas. The company has its headquarters in Bangalore (one of four metropolitan cities in India), in the South Indian state of Karnataka. Flipkart’s warehouses serve 22000 Pincode locations across India. One of the most massive warehouses of Flipkart is located on the outskirts of Hyderabad, the capital of South Indian states of Telangana and Andhra Pradesh. This warehouse, apart from being the largest in India is also the first fully automated warehouse in the country. The growth of e-commerce in India depends, to a large extent, on how leading players manage their distribution system.  Making deliveries possible to remote areas in various Indian states requires that the company establishes modern and hi-tech warehouses in different corners of the nation. The Hyderabad warehouse of Flipkart is a hi-tech warehouse. It relies on advanced technologies like IoT equipped automated conveyor belts, IT-based packaging, and tracking solutions, digital inventory management systems as well as other forms of digital solutions. These technologies enable the swift movement of goods and services from one part of India to another.

While the e-commerce website Flipkart conducts its business online mainly, its distribution system supports its business operations across entire India like a backbone. The company has established a network of fulfillment centers in states including Haryana, Telangana, Maharashtra, Karnataka, and West Bengal. 

Price:

Growing competition in the physical retail and e-commerce industry has brought the focus back on prices. While product quality and speed of delivery are also important factors affecting the market share of e-commerce players in India, pricing is central to popularity. The Indian consumers are highly price-conscious and compare prices before going for a purchase. Flipkart, Amazon India, Snapdeal, and other major e-commerce players in India are engaged in a bitter price war. Walmart is also present in the physical retail space in the Indian market. In the Indian e-commerce market, brands must price products competitively to succeed. Walmart is already well known for its EDLP pricing strategy. Just as in its domestic market, it uses a competitive pricing structure to gain sales. However, the level of success that it has tasted in e-commerce could not be matched by its physical retail division in India.

The main reason that Flipkart and Amazon India are leading in the Indian e-commerce market is that the two offer products at more competitive prices than the others. It is why other brands like Snapdeal are lagging behind the two giants in terms of market share. To retain customers and grow its market share, Flipkart also runs mega sales during the festivals. Flipkart’s Diwali mega sale is among the most eagerly awaited sales in India. Flipkart offers massive discounts on an extensive range of electronics and other products during the Diwali sale. Indian consumers shop heavily on the eve of Diwali. Flipkart also runs sales and discount programs on different occasions like Holi, Durga Puja, and other festivals when Indian consumers are more likely to shop. 

Promotion:

A remarkable level of competition marks the e-commerce industry in India. The e-commerce brands in India, apart from competing based on price, run regular marketing campaigns to drive sales and grow their customer base. Marketing and promotions are critical drivers of sales and revenue growth for Flipkart. However, it has become the leading digital retail brand in India and a household name in most corners of the country. Due to its growing penetration of the rural areas of the country, the company is now gaining more ground in the local market. Flipkart’s growth is also driven by its focus on brand image and consistent branding. Its growth over the previous few years is a result of strong branding and a growing emphasis on marketing. Digital marketing is the primary channel used by Flipkart to grow its customer base. Apart from its websites and apps, the company uses digital promotions as well as other traditional channels like print media and outdoor advertisements to grow sales. 

Flipkart also uses branded packaging to gain visibility. Throughout its warehouses, merchandise is wrapped in Flipkart’s branded packaging before being delivered to the customers. It has also launched special promotional programs and customer retention programs aimed at growing membership rates. Flipkart Plus is a membership program that offers access to special privileges like more points when you shop on Flipkart as well as faster delivery, extra discounts, early access to sales, superior customer support, among others. The company has launched Flipkart Lite combining the rich features of a web app with the browser experience so that customers can have a seamless shopping experience, even with low network connectivity.

 The popularity of e-commerce websites like Flipkart depends on the type of shopping experience they provide. Secure payments, hassle-free checkouts as well as improved suggestions and other features like product comparisons are all essential to keep customers engaged. The growing use of smartphones and the internet in India has led to more people searching for electronics and fashion as well as crucial household products from home. E-commerce brands have to focus on continuous innovation to offer the customers more relevant suggestions and seamless shopping experience. To make shopping for the Windows 10 users more exciting, the company worked with Microsoft to create an app for the Windows platform. The Flipkart Windows 10 app has been developed keeping in mind the Windows experience for touch and non-touch screens so that the users can utilize the general shortcuts they use on Windows to browse and shop for their favorite products.  

Brand image has become very important for retaining customers and sustaining growth momentum in the e-commerce industry. Flipkart invests in CSR and sustainability to create a strong social image. Apart from that, the company is also helping several small and medium sized businesses thrive during the times of Covid-19.  

People:

As of 2016, Flipkart employed 30,000 people. The company has continued to expand its business fast over the recent years. The company calls its employees Flipsters. The company focuses on managing its human capital in a manner that maximizes employee and customer satisfaction. Employees’ happiness is key to business growth. The company invests in its employees’ training and growth. Apart from that, it has created human resource policies that help maximize satisfaction for its workers and help them achieve a better balance between their career and personal lives. The CEO of Flipkart is Kalyan Krishnamurthy. 

Processes:

The e-commerce industry is marked by heavy competition and companies have to manage business processes in a manner to ensure higher efficiency and productivity. Flipkart has acquired a lot of growth within the last few years. The company had managed to achieve a strong position in the Indian e-commerce market prior to its acquisition by Walmart. From its website to the warehouses and fulfillment centers, the company focuses on business process efficiency to achieve stronger results. The company generated a revenue of around $6.1 billion in 2019 which was around 42% higher than the previous year. The company has been investing in technology and expansion of its physical infrastructure to achieve superior financial growth. Technology plays a key role in ensuring the operational efficiency of the company from its website to its warehouses. While Flipkart is continuously improving its website and apps to make them more shopper-friendly, it is also investing in making its warehouses technologically advanced and best in class to enhance their capacity. It ensures that the customers have a superior shopping experience, and products are delivered to the customers faster.

Physical Evidence:

Physical evidence denotes the physical proof of the products and services of a company. If a company makes hardware or other products, the product itself can count as physical evidence. However, if the company offers services or creates software or something like streaming services, then physical evidence may not be as readily available as in the case of the brands making physical products. So, while it may be easy to find physical evidence related to Apple, it may be not easy to find physical evidence associated with Google because the other is mostly a services company. However, there is a lot apart from the physical infrastructure and branding related material that still provides the physical evidence of business. 

As in the case of an e-commerce business like Flipkart that sells products and services by other brands mainly, there is still a  lot that counts as physical evidence. First of all, it is the packaging used by the company and the branding on it that is the physical evidence of the services provided by Flipkart. The packages used to wrap products to be delivered have the Flipkart logo on them. Apart from that, the physical infrastructure of the company including its offices, warehouses, and fulfillment centers also offers physical evidence of the business. In the digital era, there are a large number of services that will not present a lot of physical evidence but their branding material and physical infrastructure offer the physical evidence of their business operations. For example, Netflix is a brand offering streaming services. Its products/services are bought and consumed online using a physical screen that supports internet connectivity. In such a case, it would not be easy to obtain physical evidence as compared to a brand that makes hardware products like Samsung.  In this way, from product brands like Samsung or LG to services brands like Flipkart and Amazon, the amount and extent of physical evidence vary depending on the volume of products made by the company itself and extent of the company’s own involvement in the provision of services.  As in the case of Amazon that makes and sells a large range of products including Alexa enabled devices and Kindle Reader as well as a nice range of other products sold on its website, physical evidence is much easier to find compared to Flipkart.

Abhijeet Pratap

Abhijeet has been blogging on educational topics and business research since 2016. He graduated with a Hons. in English literature from BRABU and an MBA from the Asia-Pacific Institute of Management, New Delhi. He likes to blog and share his knowledge and research in business management, marketing, literature and other areas with his readers.