E-Business Report: Information Technology in Flipkart E-Commerce

This report provides an analysis of Flipkart's e-commerce operations, focusing on its business model and the role of information technology. It examines Flipkart's customer value proposition, which includes offering products at competitive prices and providing convenient accessibility. The report details Flipkart's revenue model, including commission-based charges on sellers and advertising revenue. It explores the impact of IT infrastructure on Flipkart's operations, emphasizing its importance in reaching a wide customer base and offering return policies. Furthermore, the report delves into the significance of IT in Flipkart's marketing strategies, including digital marketing and e-business techniques. It assesses the performance of Flipkart's e-business model, highlighting cost reduction, inventory turnover, and revenue generation. Finally, the report examines Flipkart's e-commerce marketing and advertising efforts, covering product offerings, pricing strategies, sustainability initiatives, and supply chain management.

Running Head: INFORMATION TECHNOLGY IN FLIPKART E-COMMERCE
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flipkart
E-Business
Student name
8/25/2019

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Contents
Introduction:...............................................................................................................................2
The business model of Flipkart:.................................................................................................2
Impacts of Information Technology Infrastructure:...................................................................4
Importance of information technology in the marketing of Flipkart:........................................5
E-business model performance:.................................................................................................5
E-Commerce marketing & advertising:.....................................................................................6
Conclusion:................................................................................................................................7
Bibliography...............................................................................................................................8

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Introduction:
The purpose of the paper is to demonstrate an understanding of analysis of the
information technology infrastructure and e-commerce with respect to the Flipkart
organization. Originally known as the Flipkart Internet Private Limited, founded by Sachin
Bansal and Binny Bansal, the company was more into sale of books and thereafter it
enhanced its area to widen the categories like consumer electronics, fashion and the lifestyle
products. The current revenue of the company for the financial year 2018 is USD 19,900
crores. The report deals with the business model of flipkart along with an in-depth
understanding of the infrastructure in the era of information technology and how the
company can e-advertise to create a versatile identity and be competitive (Anubhav Reddy,
2014).
In simpler terms E-commerce is related to business done through with the utilization
of internet. Here, there is required of buyer and seller to operate. Tools which are used in
this consideration are mobile, electronic data interchange, electronic funds transfer as well as
supply chain management (Pathak, 2015).
The business model of Flipkart:
Model of business is linked with the revenue model as well as value proposition
which it offers in the market. It adopts B2C that is business to the consumer which thereby,
helps the customer to get the goods at less cost (Chopra, 2016).
The revenue model of the Flipkart is quite simple and straight forward as it follows
the advertising revenue model and the same has been derived in steps (Zhang, 2011).

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 For this facility, it charges a commission from the sellers with respect to sales done
and equivalent to 10% of the product
 For increasing the effectiveness of business Filpkart also deals with E-Kart which
provides the facility of logistics not only to the Flipkart but also to other e-commerce
organizations.
 It charges different types of amount of commission on the basis of products and the
other sources through which income is gathered is by Myntra, an online clothing store
(Fatima, 2014).
 Recently the model is going to see a variation where the seller will have to pay for the
advertisement on Flipkart instead of commission (Agarwal A. , 2015).
Customer Value proposition:
Flipkart Company targets those customers who can spend lavishly and those who
want to buy products while there is any kind of sale or existing offers. Thus it has a great
strategy to target the customers which thereby, helps in enhancing all groups effectively. It
offers convenience as well as accessibility while selling so to satisfy the needs and wants of
customers easily (Bansal, 2018).
In addition, Filpkart facilitates on the e-tailers, as they are spending huge sums on
advertising campaigns, innovating the structure of the warehouse, recruiting thousands of
temporary staff for logistics/delivery and launching attractive financing schemes for the sale
in comparison to Amazon which mainly focuses on the market share.
Flipkart focuses on building the long term relation with the buyers so to make them
loyal and which in turn, helps in reducing the switching cost. The same is achieved through
offering the products at less cost and within 24 hours of service. Filpkart also deals with the
loyalty program where the queries of the customers are entertained on an urgent basis with

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innovative solutions which is yet to be started by Amazon. Henceforth, the customers tend to
buy from filpkart more. The afcts also state Flipkart to be ahead in terms of revenue (Agarwal
M. , 2018).
Market space
Source: (Business Standard.com)
The market share is higher in terms of Amazon and Snapdeal, and 44% of the share is
acquired by the Flipkart.
Market place for its operations is prevailing worldwide and in terms of the potential
commercial value, Flipkart has created value on the basis of several resources such as human
resources. Under the human resources the company tends to make smooth relations with the
suppliers. In terms of the management, location as well as nature of properties the
competitive advantage is sustained till now.

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Competitors:
Major competitors of Flipkart are Amazon and Snapdeal. The reason of the strong
competition is the companies are working in the same industry and offers wide variety of the
solution and works under the market known as Oligopoly.

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Source: (Tanz, 2016)
The above chart explains the competitive scenario of all the three companies in terms of a
wide variety of the categories. The fees on commission charged by Amazon are higher than
the Flipkart and Snapdeal whereas on the contrary Amazon provides the facility of the self-
shipping where Flipkart and Snapdeal are currently lacking.
Competitive advantage: Flipkart offers festive discount offers and its supply chain network
is good which makes the delivery of product on time. It works on a consumer-centric strategy
approach. This can be observed when Flipkart beats Amazon by 50%durng the first leg of the
festive sale. Flipkart was on 51% where Amazon was on 32% (Business Standard.com).
Snapdeal is having a great advantage of packaging over Amazon as well as Flipkart.
However, it has a limited range of products as compared to both. Flipkart adopts the mixture
of Amazon and Snapdeal. The price per packaging is INR 3 per order (Prasad, 2015).
While going through all these points together it can be said that Flipkart has an
advantage in this segment as Snapdeal is on the range of closure. In terms of revenue also it is
higher as compared to Amazon but, the market value of Amazon is larger than Flipkart and it
is gained only in few years which are a major concern for Flipkart Company (Tanz, 2016).
They are a competitor because these both companies are selling similar types of
products to the consumers so, automatically war arises in between to grasp the largest share
in the market (Zhang, 2011).
Market strategy of Flipkart:
Generally the Flipkart uses the marketing strategy in the form of digital marketing and it is
based on four major pillars such as investments as the company requires music streaming
portal Mime360 in October in the year 2010. Ekart, Flipkart’s in-house logistics arm, tends to

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be one of the compelling website and the solution giver where the transfer of the goods and
the services are possible in the easiest manner. It has given Flipkart an unmatched reached
into the interiors of India with coverage of over 6,500 pin codes (Nair).
Impacts of Information Technology Infrastructure:
It is important in the case of Flip kart’s operations as its philosophy is that technology
is serving a purpose and innovation is that which motivates for the solutions. In respect to
India, Flipkart makes its website reachable in low connectivity also as here technology is not
much faster just like other countries of the world. It also gives assurance to the users if
defective product is obtained as it is having a return policy which safeguards the buyers and
also saves the time of traveling which is usually done in the case of online modes (Roberts,
2015).
It wins the hearts of consumers effectively. In last year, it increased the usage of
technology to up to 50% and it was made with the intention to increase the infrastructure on
the mobile database as there are many users which exist in this country India (Prasad, 2015).
The disadvantage which can be seen in e-commerce Flipkart when government
changes the policy of foreign direct investment especially for e-businesses that it cannot sell
product of some particular deal but, not all and also, fixes the limit 25% for each vendor
selling (economictimes, 2019).
Importance of information technology in the marketing of Flipkart:
The information technology plays a crucial role in making the Flipkart earn billions
on the basis of the simple click. It competes with the offline brands by way of utilising the
technique of digital marketing communication (Laudon K. C., 2016). The Flipkart solves the

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queries of the customer on an earlier basis and allows the customers to write the query over
the portal itself.
The major strategy of the company is to raise as much as 1 billion dollars to fund
various businesses as well as organizations. This e business strategy works on the basis of
new types of techniques for artificial intelligence, data science, robotics and internet of things
(IoT). It improves the supply chain by increasing the channels of the communication and
thereby creating a means of (Agarwal A. , 2015).
E-business model performance:
Information Technology helps the Flipkart to reduce cost relating to logistics by
developing a park in Bengaluru for this as it understands clearly though the initial cost of this
is high, it is beneficial for the longer duration.
It also reduced the number of outsourcers for manufacturing a product which was
particularly done by China as well as Malaysia and it was done with an initiative to support
the ‘Make in India’ initiative launched in India. Inventory turnover is increased to 19% in the
financial year 2017 (Liang, 2014).
Asset returns are increased by putting focus on increasing the artificial intelligence
technology in the company and due to this it finds out this technology and sets an amount $
25 million for this purpose (Bansal, 2018). It makes the second data infrastructure in the
country Hyderabad so to gain the benefit in its operations as it serves as an advantage to the
consumers and sellers of commodities.
Inventory Turnover is concerned with the campaign’ Big Billion Days Sale’ has
increased the human resources in the organization as it is required for making it successful

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and it also includes the delivery of staff (Rawat, 2014). The inventory turnover ratio of the
Filpkart is 45 days in the year 2018 (Dalal, 2017).
Revenue Generation is increased up to 19% in comparison to the previous year. The
revenue generation is through the selling of the products and the commission earned from the
advertisements. Flipkart accounts for 75% of revenues and it tends to be the torch bearer
(Dalal, 2017).
E-Commerce marketing & advertising:
Product: It provides products such as Books& Media, Baby& Kids Items, Electronics, Home
appliances, Apparel as well as Auto& Sports Item. It also launches its own products under the
name ‘DigiFlip’ and it is a great medium to launch a new product as it is done in the case of
company Motorola.
Price: It maintains competitive pricing strategy and its business are boosted up due to e-
commerce transactions done in the country as people are now focusing on digitalization.
Sustainability: In this year, it takes the step towards sustainability by introducing electric
vehicles for delivery of its products. This initiative is very much good towards the
environment and businesses have to fulfil this as regards to corporate social responsibility.
With this carbon an emission tends to reduce down to 50% and also helps to reduce the cost
of maintenance and delivery in respect to organization. It is made to replace the 40% of
delivery vans to electric vehicles and this target is achieved by the year 2020 (Anubhav
Reddy, 2014).
Supply chain: It builds up a relationship with the supplier by networking more than 500
distributors and it sells only those items which are in demand. It maintains the 4 offices in the
metropolitan cities and takes the services of courier where delivery cannot be done easily. It

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builds up three teams for effectively supply the goods from warehouses. First, is product and
technology team is made so to check the progress of product with the utilization of
technologies. Second, is business development team for dealing with the sales of firm and it
includes following things in its scope such as vendor management as well as discounting
strategy (Chopra, 2016).
Communication and customer engagement:
It has been achieved effectively by making an interaction through various social
media apps like YouTube, Twitter, Google Plus and Facebook. Flipkart also gives training to
employees so that they can solve out the queries of customers effectively so that the customer
feels happy and satisfied by buying the product (Rawat, 2014).
It supports the e-commerce transactions by giving the facility of 30 days replacement
policy as consumers can do freely shopping without any fear in mind. This facility includes
three steps that are: replacement, store credit and actual cash back (Kourouthanassis, 2014).
Conclusion:
E-commerce is the activity of buying and selling of products with the use of
connectivity of the internet. Flipkart is a huge brand in India and makes up its position firstly
in the market scenario but, with the expansion of e-businesses, it faces tough competition
from Amazon as it has also had good strategy which can easily grasp the market share in less
duration possibly.
However, it adopts changes in its business effectively which thereby, helps in
surviving for the longer duration of time. It provides goods on time, 24 hours support service,
having a return policy which helps in getting the attention of consumers easily. In the future,
it should find a solution to government policy, which will hamper its productivity.

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