Flipkart

Customer Centricity and CRM Implementation in Indian Industry

GROUP 5 –
VIDUSHI VAID (UM17312)
JOHNFELIX A (UM17333)
RAVIKANTH KANDOTI (UM17335)
MONALISA JHA(UM17341)
SHUBHAM SHARMA (UM17367)
SUBHAYU SAHA (UM17374)
 Customer Centricity and CRM Implementation in Indian Industry –
Flipkart
History:
Flipkart is an Indian electronic commerce company founded in 2007, by Sachin Bansal and Binny
Bansal. It operates exclusively in India, where it is headquartered in Bangalore, Karnataka. It
is registered in Singapore, and owned by a Singapore-based holding company. Flipkart has
launched its own product range under the name "Digi Flip", offering camera bags, pen-drives, headphones,
computer accessories, etc. Legally, Flipkart is not an Indian company since it is registered in
Singapore and majority of its shareholders are foreigners. Because foreign companies are not
allowed to do multi-brand e-retailing in India, Flipkart sells goods in India through a
company called WS Retail. Other third-party sellers or companies can also sell goods through
the Flipkart platform.
 Flipkart was founded in 2007 by Sachin Bansal and Binny Bansal, both alumni of the [Indian
Institute of Technology Delhi]. They had been working for  Amazon.com previously. The
business was formally incorporated as a company in October 2008 as Flipkart Online
Services Pvt. Ltd. During its initial years, Flipkart focused only on books, and soon as it
expanded, it started offering other products like electronic goods, air conditioners, air
coolers, stationery supplies and life style products and e-books. The first product sold by them
was the book Leaving Microsoft to Change the World, bought by VVK Chandra from Andhra
Pradesh. Flipkart now employs more than 9000 people. Flipkart allows payment methods such
as cash on delivery, creditor debit card transactions, net banking, e-gift voucher and card swipe on
delivery.

About The Company

Flipkart can be said to be the pioneer in initiating the sceptical Indian shopper into online
retailer. Flipkart has built itself on the core foundations of reliability, quickness, credibility,
variety and quality. It uses Customer Relationship Management as its differentiating factor.
Providing good customer service enables Flipkart to enjoy high levels of customer
satisfaction, generate repeat business and ensure positive word-of-mouth.

Customer Centric Vision

The customer is informed at every step through e-mail/text when the order has been
confirmed, order summary & shipment details and tracker, informing customer if order has
been delayed.Easy to reach out to the customer service team through their social media
channels as well as a customer care number.Customer complaints are quickly addressed and
there are transparent return and exchange policies.

Strategic CRM
Customer-management orientation at fipkart. The company philosophy echoes in their tagline
“making better our service promise”. The founders believe that huge discounts alone cannot
sustain a successful business, customer satisfaction and preferences need to be addressed to
keep the flame going.Core foundations are reliability, quickness, credibility, variety and
quality. Providing good customer service enables Flipkart to enjoy high levels of customer
satisfaction, generate repeat business and ensure positive word-of-mouth. Senior management
believes that as the retail sector evolves, customer satisfaction will be a key driver of success
for most brands and organization.

Customer Experience Management

Online shoppers often make unique colloquial searches such as for ‘Madhuri Dixit saris’ and
‘Bollywood dresses’ while browsing for products on ecommerce platforms. That’s just one
nugget of insight that Flipkart is sharing with its merchants to help them sell more on its
platform.Flipkart has started providing its sellers insights on customer behaviour as well as
trends of other merchants on the platform, while sharing with customers its scores for each
seller based on product and service quality.The aim is to lower product returns and improve
customer experience. Driven as impact of social media. Flipkart recently launched a
programme to conduct surprise checks on sellers with an aim to ensure product quality. 

Challenges of Flipkart
Flipkart is growing at a tremendous pace. To accommodate its growing capabilities and And
support new business, it needs huge infrastructure and presently it lacks it. Flipkart face
inherent difficulty of e-commerce industry of capturing consumer interests and preference
and constantly modifying offerings to reflect the same. Huge costs of manpower and runway
costs to sustain the business. Distrust among consumers regarding making payments online
via payment gateway. Cash-on-Delivery is not very sustainable revenue generation option. E-
commerce sites like flipkart need constant technical up gradation to maintain the problem.
Existence of emergence of several competitor in the sector making it difficult to continue as a
leader. Acquisition have their own threshold and can be implemented only in a limited
scenario. With too many opportunities now available for suppliers, distributor, publisher, and
other affiliates, Flipkart face huge challenges of retaining existing alliances and luring new
connection. Scaling up the existing business along with uploading Flipkart’s values of
delivering quality of products in short duration in reliable and convenient way is still a huge
challenge. With the prospective entry of e-commerce giant amazon, flipkart will experience
major crisis as the former can offer greater discount.

Return and Exchange Policies

Flip kart allow its users to return products if unsatisfied within 30 day period with full refund
of money or exchange for another product. This allows customers to shop online without
worrying about the risks involved. It uses the Wallet feature to debit the refund money that
can be used to make a purchase from the website.
Understanding Customers
Flipkart has an amazing recommendation system at place to make product discovery faster
and seamless. The recommendation system used by Flip Kart predicts user’s intent and helps
connect them with products they need or perhaps be interested in an automated manner. They
help users in following ways:
 Help find: similar products. Example: recommendations to buy a apple phone when
surfing Nokia phones.
 Help decide. Example: people who viewed this ended up buying.
 Complete the purchase experience. Example: cases for phones, laptop bags etc.
 Excite or wow 

Customer Segmentation
Potential Customers (a.k.a. Prospects)
 They have demonstrated interest in its products but they are not yet ready to commit
to a purchase
 A combination of strategic branding, targeted coupons and product education should
work well to engage this type of customer
 First-Time Buyers (a.k.a. One-time buyers)
 These are customers who have only completed a single purchase with Flipkart.
 With this customer segment, its goal should be to turn them into repeat buyers
Repeat Customers
 Shoppers who have made two or more separate purchases.
 These are customers who enjoyed its product enough the first time to return and place
another order
 It must cherish these users as they may become brand evangelists who are loyal and
regularly refer friends to Flipkart
 It must respond quickly to customer service requests and experiment with ways to
encourage them to place additional orders.
 Customers who have placed multiple orders in a short time frame
 Most valuable buyers
 To maintain their loyalty, it must consistently raise the bar on customer service and
product innovation
 Also it should invite them to be a part of the brand- growing process by asking their
opinion
At-Risk Repeat Customers
 At-risk repeat customers are characterized as shoppers who have made multiple
purchases in the past but have let more time lapse since their last order than the
average time all of its customers typically wait between orders.
  It can incentivize them to make another purchase with a coupon, or ask them why
they have not purchased from you in a while.
Inactive Repeat Customers (also known as Idle, lapsed and latent customers)
 It may lose touch with some of its most loyal customers i.e. either their needs change,
or its brand and product change
 Inactive customers are shoppers who have placed multiple orders before but they have
not placed another order for more than three times the average time customers spend
between orders.

Market Segmentation
The process of defining and subdividing a large homogenous market into clearly identifiable
segments having similar needs, wants, or demand characteristics. Its objective is to design a
marketing mix that precisely matches the expectations of customers in the targeted segment.
Few companies are big enough to supply the needs of an entire market; most must breakdown
the total demand into segments and choose those that the company is best equipped to handle.
The four basic market segmentation-strategies are based on
Geographic Segmentation -caters to tier 1, tier 2 and tier 3 cities
Demographic Segmentation - 75% of online users between the age group of 15-34 years.
Flipkart targets mainly the youth of the country
Behavioural Segmentation – Web friendly people.
Psychographic Segmentation – Flipkart concentrates on more psychographic, which helps in
deciding where to display ads online. They target online shoppers and people who don‘t
online shop (thus TVC to encourage them).

Market Positioning
It is an effort to influence consumer perception of a brand or product relative to the
perception of competing brands or products. Its objective is to occupy a clear, unique, and
advantageous position in the consumer's mind.
Points of parity:
• Easy locating of products
• Competitive prices.
• No hassles of going to shops personally and shop for products
• Availability of various products on one platform
• Discount on purchases.
• Home delivery
• Gifting services
• Cash on delivery
• Availability of liquor
 • Fleapits

Points of Difference:
• Flipkart membership cards for premium customers
• Vernacular language
• Better user interface-one drag approach
•

Customer Demographic Analysis and Customer Behaviour Modelling

It falls in to the categories of youth, avid book readers, technology enthusiasts and online
shoppers. Therefore, it has carefully demarcated and segmented each of the demographic
categories and modelled the customer behaviour to understand their needs and preferences. It
creates data models from the following sources
 Bought history
 Browse history
 Compare history
 Bought items
 Wish list items
 Rated products
 Cart additions

Customer Value Assessment

Value assessment at Flipkart is done through various metrics such as:
 Click-through-rates
 The proportion of visitors to a web page who follow a hypertext link to a particular
site.
 Relevance/ quality
 Visibility
 Click-to-order: Clicking on a hyperlink to place order

Operational CRM via Sales Force Automation(SFA)

SFA is the application of technology to support regular sales functions and includes tools that
are employed by users to perform administrative and other repetitive tasks. SFA transforms
repetitive and routine manual processes to automated processes, which helps sales reps
operate in a more efficient manner. For example, applications such as quarterly automated
sales reports and calendaring tools are key elements of sales technology. Sales reps can
remain in contact with distant customers via e-mails and cell phones, thus reducing travel
hours. They can also receive and manage orders from customers in an easy, timely fashion.
Reduce downtime and increase production during regular work hours.Addition-ally,
applications like calendaring and routing tables help sales reps reduce downtime and increase
their own production during regular work hours.
Business Canvas
Key Partners:
 Equity Partners: Accel and Tiger Global
 Advisory and Restructuring: Indus Law
 Distributors and Suppliers
Customer Segment:
 Youth
 Avid Book Readers
 Tech Savvies
 Online Shoppers
 Trend Setters
Customer Relationships:
 Word of Mouth
 Online and Interactive Advertisement
 Social Media
Cost Structure:
 Infrastructure Costs
 Manpower Costs
 Platform Maintenance Costs
Revenue Stream:
 Online Sales
Key Activities:
 Platform Management
 Platform Promotion
 Service Provisioning
Key Resources:
 Hardware and Software for Platform
 Manpower
 Capital

IT Architecture
Flipkart Commerce Graph — Evaluation of graph data stores
 The shopping interests of customers keep changing with their lifestyle. A customer
might want to shop for a book today and 3 months later shop for a laptop. With an
increase in such behavioural changes, there was a need to relate such users.
 Commerce graph is one such solution at Flipkart to identify users with similar
shopping patterns. It relates users and products based on the user’s behaviour on the
website and apps by:
 Generating features for insights ML models
 Finding out heterogeneous users as beta and control set
 Detecting fraudulent sellers and buyers
Astra
 Flipkart Security team built an in-house, open-source inspired tool, ASTRA
(Automated Security Testing for REST API’s) is a security automation tool that
enables the developer to identify the potential security threats in REST APIs and
patch vulnerabilities during the initial phase of the development cycle. Interestingly, it
is the pioneer of security tools meant exclusively for the penetration testing of REST
APIs.
Machine Learning
 When one searches for an item , he or she is directed to similar products of their
interest. The internal data as well as user studies show that this is one of the most
common journey paths of the users, especially when buying from exploratory
categories such as Fashion and Home where there is huge selection and people
generally don’t have specific product or brand on mind.

Multichannel Integration
 Web, Mobile App, Mobile website, Social Media, Voice Call and others
 CRM helps in the integration of all the channels at the back end and deliver a
seamless customer experience
 Eyeing Brick and Mortar E-commerce
o CAGR: 34%, Share of total retail sales: 0.4%.
o After 5 years- Brick & Mortar
o Still 80% (PWC report)

Customer Survey Insights

 9 of 10 Customers have returned goods at least once
 55% of customers have received products of different size, colour or style than what
they had ordered
 46% of the customers prefer to talk to a customer care person than send a mail
 40% of customers have felt dissatisfied with the responsiveness of customer care
 64% of customers make purchase decision solely on basis of discounts provided
 18% of the customers prefer to pay by Cash on Delivery (CoD) than pay online for
products
Measuring Impact
Through CRM initiatives, Flip kart has successfully garnered an audience strength of 9.6
million unique users every month growing at 431% annually. Its inventory model and strong
customer relationship management has made it the largest book seller in both online and
offline category in India. Through its efficient e-crm implementation, Flip kart has website
visits of 170 million Total Number of Repeat customers have been 70% of net consumers.
The average order size has risen to Rupees 850 from Rs.300 in the past, with bulk of sales
happening from the books category. The current margin Flipkart gains from its sales has gone
up in various categories: Books: 20%, Apparels: 30-40%, Electronics-6-8%

Measuring Impact facts

 The outreach to online user has scaled up to 14.5%
 We can assume 75% of the registered users (22 million) are active users and hence the
revised number should be: 15 million active users with 60 million shipments each
year. Hence roughly 4 shipments per user per year.
 The supply chain and distribution model has been majorly impacted by technology
integration with delivery of products reaching a milestone of 20 products per minute
i.e. 1250 an hour and 30,000 items a day.
 With increase in customer base and number of orders, the estimated % return of goods
has also gone up to 20-30%
 No of employees has increased to approximately 5000

Conclusion
Customer Relationship Management helped Flipkart improving the relationship with existing
customers, finding new prospective customers, and winning back former customers with
information centralized you can now run targeted and personalized marketing & promotional
campaigns Enabled customer centric demand planning and scheduling across the company.
The company can now better forecast the demand for their products and manage their
inventory (sales, sourcing, manufacturing, etc.) better After sales service is one of the most
critical aspects of a CRM. With all the necessary information available on their fingertips,
your customer representatives can now provide better after sales service to your customers