We are obsessed with customer satisfaction'

Print edition : May 04, 2012

Sachin Bansal, chief executive officer of Flipkart.com.-BIJOY GHOSH

BY creating Flipkart, an online retail site, Sachin Bansal and Binny Bansal have not just shaken up India's online inertia but helped create an industry. Several e-entrepreneurs, encouraged by Flipkart's success, have begun interesting online retail sites, leading to a completely new trend in shopping and commerce. In an interview to Frontline, Sachin Bansal speaks about what the duo did right and where the e-commerce industry is going. Excerpts:

Given the reluctance of the Indian consumer to shop online, what made you venture into this area and also believe that a business plan such as cash on delivery (COD) will work?

Our initial plan was simply to launch a service or a product that appealed to the Indian consumer and fulfilled some need in the market. At first we thought of starting a price aggregation model for other e-commerce players in the country. However, post-research we realised that there were hardly any serious players in the space. We felt this was an opportunity waiting to be realised and hence decided to start our own online shopping venture. The success online ticketing sites were enjoying among consumers convinced us that Indians were ready to shop online for other products, too, as long as they had a service that could delight them for its reliability and quality of products.

We were also conscious of the fact that we would have to solve a lot of problems that were unique to the psyche of the Indian consumer in order to succeed in this space. For example, a large number of Indians still do not possess credit cards or are wary of revealing their card details online. In order to overcome this, we launched our path-breaking cash-on-delivery feature. This has opened up a whole new segment of consumers to us, and today almost 65 per cent of our deliveries are on a COD basis.

Flipkart is considered to have revolutionised online retail in India. Your comments.

We have managed to get a lot of things right. We have constantly tried to innovate, bringing fresh features and services to the consumer, with a single-minded focus of demystifying online shopping for them. This includes our cash- or card-on-delivery, our own logistics system to ease last-mile delivery bottlenecks and our 30-day replacement policy to assure customers who are wary of the quality of online products. With the launch of Flyte, we have also become one of the first players in the country to introduce a legal paid music download platform.

However, we believe that what truly sets us apart and is the reason for our success is our obsession with customer satisfaction. Every feature we launch, every new development we undergo, is focussed on the customer and on how it can contribute towards making online shopping the most convenient and trustworthy option to him/her. Our aim is to become the largest retailer in the country, and we believe we will succeed in this endeavour.

Amazon has launched its online shopping website in India. Typical of all big retailers, it will ruin the smaller businesses. Flipkart is hardly small, but still do you see its entry as a threat?

Given the stage Indian e-commerce is in, we believe the market is big enough for multiple players who are serious about growing in this space, and these include Amazon although not in its current form [Junglee], which is more of an aggregator. E-commerce in India is still at a nascent stage and the market needs players who can get the masses from offline to online shopping. To make this happen, what customers need is a place they can rely upon to provide a consistent, hassle-free shopping experience. We are committed to providing this experience to our Indian customers since we have managed to build a unique end-to-end shopping experience for them by working on every aspect of this interaction.

Could you explain your supply and delivery system? For instance, a 30-day return policy is quite a risk.

A robust back end is the key to a successful e-commerce site. We believe in extensive investment and automation of our supply chain and logistics. Getting our own warehouses to stock an extensive inventory and using our own delivery system in a majority of places have ensured a greater order to delivery turnaround time. Along with faster delivery, post-delivery customer support is also a key factor to attract consumers. Features such as our 30-day replacement policy communicate to our customers that we are serious about delivering only quality products and are willing to go that extra mile to address quality-related issues. Such services go a long way in ensuring loyalty that far surpasses risks.

INSIDE the FLIPKART.COM office at Koramangala in Bangalore.-G.R.N. SOMASHEKAR

What has happened to the buyers' need to touch, feel and try the product before buying?

Those who prefer the whole experience of touching and trying out a product will shop offline. However, more and more consumers today are beginning to understand the advantages to shopping online. The convenience of being able to get your products delivered at your doorstep (a huge plus in urban areas where distance and pace of life do not permit extensive travel) as well as the huge inventory offered by stores such as ours (something that no offline store can match) are beginning to outweigh the need to look at a product before buying it. Added to this are the discounts offered by online stores and the customer-friendly options, such as COD and equated monthly instalments, that are tipping the scales in favour of online shopping.

Would you sell products supplied by international traders? Is there a policy regarding the sale of products supplied by international retailers?

We do work with international suppliers and vendors even at this stage. We have a tie-up with many suppliers, of whom a fair number are from outside the country.

Information technology has produced several commercial spin-offs. Will e-commerce become another employment generator? Will educational institutions or even vocational training centres start offering courses in e-commerce?

Currently, there are no specific training modules to enhance skill sets in the e-commerce sector. There is, therefore, scope for institutions and training sectors to take advantage of this gap and come up with tailor-made courses for e-commerce aspirants. However, nothing can beat the edge that an on-field experience can provide. This is where we feel companies such as Flipkart are going a long way in creating jobs and skill sets that are contributing to the economy as a whole. Be it in technology, supply chain or logistics, we are doing our bit to train and empower individuals in a way that can only assist them in their future endeavours, with or without Flipkart.

There are several general shopping sites, but the niche ones seem more interesting. How is it going to come together?

The e-commerce sector is seeing a lot of interest shown by various players. With increased attention from the government, private players and investors alike, more and more companies are entering this market. As the industry matures, we expect some consolidation to take place with the emergence of larger, better-established players.

In such a hyper-competitive environment, we believe only those companies that walk the extra mile to ensure that they delight the customer with their products and service will survive, regardless of whether they operate as niche players or as more comprehensive sites such as Flipkart.

Anupama Katakam

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