Skip to main content

Indian Online Retail (E-Tail) Industry



The online retail space formed about 0.55% of the overall Indian retail industry about Rs. 25.3 billion including organized and unorganized retail. The online retail industry constituted about 7.9% of the organized retail industry in India.

Indian e-tail industry followed an Inventory-based model or a Non-Inventory-based model also known as the MARKETPLACE MODEL.
In August 2014, industry which followed the inventory-based model were:
  • Jabong.com
  • Myntra.com 
  •  Firstcry.com
  • zovi.com
Industry that followed the non-inventory-based model were:
  • Flipkart.com
  • Snapdeal.com
  • ebay.in
  • Amazon.in



Industry experts felt the Flipkart and Myntra deal could start a phase of consolidation in the Indian online retail space which was about Rs. 139 billion (about US$2.32 billion) in 2012-13. In 2014 Flipkart made most awaited announcement of the Indian e-commerce industry – the acquisition of Myntra, leading e-tailer in the fashion and lifestyle segment where Flipkart was lagging. 



Flipkart: Leading E-tailer In India


Flipkart.com (Flipkart) referred as ‘Amazon of India’ was started by two ex-Amazon 
employees Sachin Bansal and Binny Bansal in October 2007 with an investment 
of Rs. 0.4 million.
  • The company started as an online book seller with 50,000 book titles and got its first order 
  • about four months after launch.
  • Two years later in December 2009, it became the largest store for books in India.
  • Once it picked up momentum, Flipkart started offering various products under different categories.
  •  In 2010, it started selling DVDs,VCDs, mobile phones etc.
  • In March 2011, the company was doing business with a Gross Merchandise Value (GMV) of
  •  around US$10 million.   
  • Then it added more categories as cameras, laptops, home appliances, e-learning,healthcare and  personal products, and clothing.

Myntra: Leader In Fashion E-Tail

Myntra.com (Myntra) was founded by Mukesh Bansal and Ashutosh Lawania in February 2007 in a three-bedroom flat in Bengaluru, Southern India. Vinneet Saxena (Saxena) and Raveen Sastry (Sastry) also joined the company as founders the same year. All four founders invested Rs. 5 million.
  •  Initially, Myntra was as an on-demand online personalization platform for products and gifts where the customer could personalize products such as mugs, T-shirts, calendars, key-chains, diaries, etc.
  • In October 2007, Myntra got an undisclosed amount of first funding from Accel Partners (Accel) and Sasha Mirchandani .
  • By February 2014, funds generated by Myntra was U$115 million plus in six rounds of funding.
  • In November 2012, Myntra acquired Exclusively.in Inc and its brand Sher Singh (www.shersingh.com) in exchange for cash and equity.
The Deal
  •  Initially, the offer was to merge Myntra with Flipkart. 
  • Later, Flipkart changed the offer and agreed to run both companies (Flipkart and Myntra) independently. 
Synergies

Myntra was in the high margin fashion segment and was the leader in this category. Flipkart wanted to establish itself in this segment ever since it had launched men’s clothing in October 2012.
  • Vijay Kumar Ivaturi member of Indian Angel Network  said,
 “Flipkart wants to be a horizontal, multi-category, and scale player. It seems like a good strategy to acquire a category (fashion) player for scale and depth.”
  • The deal helped Myntra gain access to Flipkart's logistics network and it was able to deliver its products to more than 9,000 PIN codes and cover more than 100.
  • In July 2014, both websites (Flipkart and Myntra) had 26 million unique visitors followed by Jabong and Amazon with 23.5 million and 16.9 million unique visitors respectively.
Road Ahead
After the deal, Flipkart and Myntra had a total 50% share in the Indian online fashion segment.
October 6, 2014, Flipkart make Rs 600 crore as a result of its “Big Billion Sale”. The 24 hour
 sale was sold out in 10 hours even as the website gave out and orders got cancelled.
Labels:

Comments

Post a Comment

Popular posts from this blog

Advantages and Disadvantages of EIS Advantages of EIS Easy for upper-level executives to use, extensive computer experience is not required in operations Provides timely delivery of company summary information Information that is provided is better understood Filters data for management Improves to tracking information Offers efficiency to decision makers Disadvantages of EIS System dependent Limited functionality, by design Information overload for some managers Benefits hard to quantify High implementation costs System may become slow, large, and hard to manage Need good internal processes for data management May lead to less reliable and less secure data
1 comment
Read more

CONCEPTUAL VIEW OF MIS

The concept is a blend of principles, theories and practices of management, information and system giving rise to a single product called MANAGEMENT INFORMATION SYSTEM . The concept of management gives high regard to the individual and his ability to use the information. MIS gives information through data analysis. While analyzing the information, it relies on many academic disciplines like management science, OR, organization behavior, psychology, etc. The foundation of MIS is the principles of management and its practices. MIS uses the concept of management control in its design and relies heavily on the fact that the decision maker is a human being and is a human processor of information. A MIS can be evolved for a specific objective it is evolved after systematic planning and design. It calls for an analysis of business, management views and policies, organization culture and the management style. The MIS,therefore relies heavily on systems theory.The systems theory offers soluti
Post a Comment
Read more

Inter-Organizational Value Chain

The value chain of   a company is part of over all value chain. The over all competitive advantage of an organization is not just dependent on the quality and efficiency of the company and quality of products but also upon the that of its suppliers and wholesalers and retailers it may use. The analysis of overall supply chain is called the value system. Different parts of the value chain 1.  Supplier     2.  Firm       3.   Channel 4 .   Buyer
Post a Comment
Read more