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Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal

  • Dailybhaskar.com
  • Dec 09, 2013, 11:58 AM IST
Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
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Flipkart.com
 
The mega online shopping store Flipkart is in the industry since 6 years now. It was revealed on 9 October that a foreign investor has funded the company with $360 million (Rs 2,228 crore).  Certainly this is huge figure. With such enormous investment, online retail chain shall now thrive neck to neck along with big brands such as Shoppers Stop and Future Retail.
 
The company had received funds worth $200 million (Rs 1,180 crore) in the first round of venture funding in July this year from investors comprising Naspers and Tiger Global. The E-commerce giant raised an additional $160 million (Rs 992 crore) in the second round by new investors — Dragoneer Investment Group, Morgan Stanley Investment Management, Sofina and Vulcan Capital, along with existing investor Tiger Global.
 
Flipkart is now a name making rounds in the market alongside top companies like P&G and Tata Global Beverages. According to the data Flipkart has provided to Ministry of Corporate Affairs, the company’s revenue in 2001–12 was $77 million (Rs 500 crore). For the fiscal 2012–13, their revenue is estimated to be $350 million (Rs 21 arab). 
 
Two alumni students of IIT Delhi, Sachin Bansal and Binny Bansal, 6 years ago started the company, which is today one of the leading online shopping websites of India. Bansals had worked with Amazon.com previously and now commenced their business with an online bookstore and later expanded to other products and finally introducing a whole marketplace.
 
Flipkart assured high-end customer satisfaction and adopted an attractive mode of payment of cash on delivery. In time delivery of product and cash on delivery carved an identity for the brand. The strategy proved to be the key to the success.
 
Click 'NEXT' to know about Sachin Bansal and Binny Bansal and their success story

Find out more by clicking on the following slides

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    Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
    Sachin Bansal and Binny Bansal
     
    On an average, a B. Tech. graduate would want to work in a big MNC for a grand pay package. IIT Delhi pass outs Sachin and Binny, who founded Flipkart in 2007, hold degree in Computer Science. The two did exactly what any B. Tec. graduate does. Sachin Bansal worked in Techspan for 6 months and in Amazon for 1.5 years, while Binny Bansal worked with Sarnoff Corporation for 1.5 years and with Amazon for 8 months.
     
    While the two were working in Amazon, they incubated the idea to start their own online venture. They quit their comfortable job with a hefty salary and entered the competition to commence their own business. Like any other middle-class family, theirs strongly opposed the idea to quit the job. The two bought time from their families by promising to return to jobs if their venture failed to be successful.
     
    Thus, Flipkart was established in 2007 and in 6 years alone the company has bagged success.
     
    Click 'NEXT' to know the key to Flipkart's success
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    Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
    Key to success
     
    A successful business person is the one who understands the needs of consumer and analyses shortfalls of business to constantly innovate and improves. Hailing from Chandigarh, Sachin and Binny commenced their venture with a small amount of Rs. 4 lakh.
     
    While the two were in Amazon they assessed that the MNC was unable to adjust to the needs of Indian consumers. They observed that not just the company was unable to satisfy the customer due to delayed deliveries, also the cost to customers was increasing.
     
    Sachin and Bansal hit the nail on the head by resolving the biggest hurdle of an online shopping store. They worked on how a product shall be delivered in time to an Indian customer. And this became the their brand’s USP. The deal was thus, a customer was to be delivered after ordering a product in a defined time. Also, they adopted the very wise cash on delivery mode of payment, which has now become very popular in online retail business.
     
    Their strategy paid off brilliant as it was decided keeping in mind the very psychology of a typical Indian customer. A local customer’s psyche is to first try and then buy. although the deal was not exactly ‘try before you buy’, a customer could see his product right in front of her before she made a payment for it.
     
    Click 'NEXT' to know how Bansals planned their business
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    Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
    Planning and mapping
     
    Sachin and Bansal mapped out their plan categorically. The duo was in no hurry to rush into all segments at once. They wanted to build a definite rapport with their customers. They wished to win the confidence of their buyers. They focussed on one product in their initial phase: Books!
     
    Considerate of consumers’ needs and demands, Bansals expanded their business steadily.
     
    Initially flipkart.com focussed on selling books. The business later expanded into other segments. Flipkart introduced several offers for their consumers. The shopping website came up with stationery, electronic products and electrical appliances such as mobiles, gadgets, ACs, coolers and lifestyle products as well.
     
    Flipkart currently ranks amongst the top 15 online retail stores in India. The company employees a staff of around 3,000 workers.
     
    Click 'NEXT' for success story of Flipkart
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    Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
    Success story of Flipkart
     
    A business that commenced with a small capital of Rs. 4 lakh, revolutionised business in India — a society that is not very popular for books. The young minds of Sachin and Binny had firm conviction. Analysts that they were, Bansals realised that India was a potential market for book selling. However, despite that people wished to read books, due to the fact that not many Indians prefer online shopping, they were unable to connect to online retail sector.
     
    Thus, breaking the barrier, Bansals set the trend by adopting ‘cash on delivery’ mode of payment to reach out to masses. There were no hidden conditions applied. Now consumers could order a desired book online and could pay cost only once they have received the book. People loved the offer. Flipkart was a hit amongst eager readers — young or old. The business hit the success. 
     
    Today, Flipkart is known as an online retail store selling not just books but electronics, gadgets, electrical appliances, lifestyle products, healthcare, baby care and much more. It is an online megastore now.
     
    What adds to the customer experience is the option to return if a customer does not like a product. The brilliant marketing strategies made customers love Flipkart. The company claims it sells 20 products in a minute. It looks forward to expand business to Rs. 5,000 crore revenue by 2015.
     
    Although the company is expanding aggressively, lately it had to bear losses. Flipkart launched online marketplace model sometime back. The model associates numerous franchise firms with Flipkart. These franchises deliver orders received through Flipkart. Thus, it saves excess expense on delivery. The companies also pay commission to Flipkart for the sales made through the online marketplace.
     
    Click 'NEXT' to know how rapidly online business is growing
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    Flipkart success story revealed! Meet Sachin Bansal and Binny Bansal
    Rapidly growing market of online business
     
    India’s retail market is much greater than the online retail market. Online retail business is estimated to be worth $10 billion while physical retail business is worth over $500 billion. Other than Flipkart, Future group, Snapdeal, Groupon, etc. are fast growing in the sector.
     
    Seeing the trend, big companies are now descending in the sector. In 2012, 20 new companies entered the E-commerce market. World’s largest E-commerce company is also soon to launch an Indian website. This year, Groupon bought an Indian website Sosasta.com and may rename it to Crazeal.com. Keeping in view the increasing number of Internet users in India, there seems a great potential in the market.
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