Flipkart
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HARSH PAHADI
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Type of site
| E-commerce |
|---|---|
| Available in | English |
| Founded | 2007 |
| Headquarters | Bengaluru, India |
| Area served | India |
| Owner | Walmart (81.3%) |
| Founder(s) | Sachin Bansal Binny Bansal |
| Key people | Kalyan Krishnamurthy (CEO)[1] |
| Services | Online shopping |
| Revenue |  ₹199 billion (US$2.8 billion) (2017) |
| Employees | 30,000 (2016) |
| Subsidiaries |
|
| Alexa rank | 156 (Global, (June 2018) 9 (India, June 2018) |
| Commercial | Yes |
| Registration | Required |
| Current status | Online |
Flipkart Pvt Ltd. is an Indian electronic commerce company based in Bengaluru, India. Founded by Sachin Bansaland Binny Bansal in 2007, the company initially focused on book sales, before expanding into other product categories such as consumer electronics, fashion, and lifestyle products.
The service competes primarily with Amazon' s Indian subsidiary, and the domestic rival Snapdeal. as of March 2017, Flipkart held a 39.5% market share of India's e-commerce industry.[7] Flipkart is significantly dominant in the sale of apparel (a position that was bolstered by its acquisitions of Myntra and Jabong.com), and was described as being "neck and neck" with Amazon in the sale of electronics and mobile phones. Flipkart also owns PhonePe, a mobile payments service based on the Unified Payments Interface (UPI).
In August 2018, U.S.-based retail chain Walmart acquired a 77% controlling stake in Flipkart for US$16 billion, valuing it at $22 billion.
History
Flipkart was founded in October 2007 by Sachin Bansal and Binny Bansal, who were both alumni of the Indian Institute of Technology Delhi and formerly worked for Amazon. The company initially focused on online book sales with country-wide shipping. Following its launch, Flipkart slowly grew in prominence; by 2008, it was receiving 100 orders per day. In 2010, Flipkart acquired the Bangalore-based social book discovery service weRead from Lulu.com.
In late 2011, Flipkart made several acquisitions relating to digital distribution, including Mime360.com and the digital content library of Bollywood portal Chakpak.
In February 2012, the company unveiled its DRM-free online music store Flyte. However, the service was unsuccessful due to competition from free streaming sites, and shut down in June 2013.
In May 2012, Flipkart acquired Letsbuy, an online electronics retailer. In May 2014, Flipkart acquired Myntra, an online fashion retailer, for 20 billion (US$280 million). Myntra continues to operate alongside Flipkart as a standalone subsidiary; the site focuses on an upscale, "fashion-conscious" market, while Flipkart itself focuses on the mainstream market and major international brands.
In February 2014, Flipkart partnered with Motorola Mobility to be the exclusive Indian retailer of its Moto G smartphone. Motorola also partnered with Flipkart on the Moto E—a phone targeted primarily towards emerging markets such as India. High demand for the phone caused the Flipkart website to crash following its midnight launch on 14 May. Flipkart subsequently held exclusive Indian launches for other smartphones, including the Xiaomi Mi3 in July 2014 (whose initial release of 10,000 devices sold out in around 5 seconds), the Redmi 1S and Redmi Note in late-2014 (which saw similarly accelerated sellouts), and Micromax's Yu Yunique 2 in 2017.
On 6 October 2014, in honour of the company's anniversary and the Diwali season, Flipkart held a major sale across the service that it promoted as "Big Billion Day". The event generated a surge of traffic, selling US$100 million worth of goods in 10 hours. The event received criticism via social media over technical issues the site experienced during the event, as well as stock shortages.
In March 2015, Flipkart blocked access to its website on mobile devices, and began requiring that users download the site's mobile app instead. The following month, Myntra went further and discontinued its website on all platforms, in favour of operating exclusively through its app. The "app-only" model, however, proved to be unsuccessful for Myntra (reducing sales by 10%), and its main website was reinstated in February 2016. The experiment with Myntra led to suggestions that Flipkart itself would perform a similar move, but this did not occur. In November 2015, Flipkart launched a new mobile website branded as "Flipkart Lite", which provides an experience inspired by Flipkart's app that runs within smartphone web browsers.
In April 2015, Flipkart acquired Appiterate, a Delhi-based mobile marketing automation firm. Flipkart stated that it would use its technology to enhance its mobile services.In October 2015, Flipkart reprised its Big Billion Day event, except as a multi-day event that would be exclusive to the Flipkart app. Flipkart also stated that it had bolstered its supply chain and introduced more fulfilment centres in order to meet customer demand.Flipkart achieved a gross merchandise volume of US$300 million during the event, with the largest volumes coming from fashion sales, and the largest value coming from mobiles.
In December 2015, Flipkart purchased a minority stake in the digital mapping provider MapmyIndia. The company stated that it would licence its data to help improve delivery logistics.In 2016, Flipkart acquired the online fashion retailer Jabong.com from Rocket Internet for US$70 million, as well as the UPI mobile payments startup PhonePe.In January 2017, Flipkart made a US$2 million investment in Tinystep, a parenting information startup.
In April 2017, eBay announced that it would sell its Indian subsidiary eBay.in to Flipkart and make a US$500 million cash investment in the company. eBaypromoted that the partnership would eventually allow Flipkart to access eBay's network of international vendors, and vice versa, but these plans never actually came to fruit. In July 2017, Flipkart made an offer to acquire its main domestic competitor, Snapdeal, for around US$700–800 million. It was rejected by the company, which was seeking at least US$1 billion.
Flipkart held a 51% share of all Indian smartphone shipments in 2017, overtaking Amazon India (33%). Flipkart sold 1.3 million phones in 20 hours on 21 September alone for its Big Billion Days promotion, doubling the number sold on the first day of the event in 2016 (where it sold a total of 2.5 million phones in five days).
Acquisition by Walmart
On 4 May 2018, it was reported that the US retail chain Walmart had won a bidding war with Amazon to acquire a majority stake in Flipkart for US$15 billion.[53][54] On 9 May 2018, Walmart officially announced its intent to acquire a 77% controlling stake in Flipkart for US$16 billion, subject to regulatory approval. Following the proposed purchase, Flipkart co-founder Sachin Bansal left the company, while the remaining management now report to Marc Lore, CEO of Walmart eCommerce US. Walmart president Doug McMillon cited the "attractiveness" of the market, explaining that their purchase "is an opportunity to partner with the company that is leading transformation of eCommerce in the market". Indian traders protested against the deal, considering the deal a threat to domestic business.
In a filing with the U.S. Securities and Exchange Commission on 11 May 2018, Walmart stated that a condition of the deal prescribed the possibility that Flipkart's current minority shareholders "may require Flipkart to effect an initial public offering following the fourth anniversary of closing of the Transactions at a valuation no less than that paid by Walmart".
Following the announcement of Walmart's deal, eBay announced that it would sell its stake in Flipkart back to the company for approximately US$1.1 billion, and re-launch its own Indian operations. The company stated that "there is huge growth potential for e-commerce in India and significant opportunity for multiple players to succeed in India's diverse, domestic market."Softbank Group also sold its entire 20% stake to Walmart, without disclosing terms of the sale.
The acquisition was completed on 18 August 2018. Walmart also provided US$2 billion in equity funding to the company.
On 13 November 2018, Flipkart CEO Binny Bansal resigned, after facing an allegation of "serious personal misconduct". Walmart stated that "while the investigation did not find evidence to corroborate the complainant's assertions against Binny, it did reveal other lapses in judgment, particularly a lack of transparency, related to how Binny responded to the situation."
Business structure
 |
| FOUNDER OF FLIPKART |
In a report dated 25 November 2014, a leading media outlet reported that Flipkart were operating through a complex business structure which included nine firms, some registered in Singapore and some in India. In 2012, Flipkart co-founders sold WS Retail to a consortium of investors led by Rajeev Kuchhal.
House brands
Flipkart maintains several house brands, including Citron (home appliances) and Digiflip
Awards and recognition
- Sachin Bansal was awarded Entrepreneur of the Year 2012–2013 from The Economic Times, a leading Indian economic daily newspaper.
- In September 2015, the two founders entered Forbes India Rich List debuting at the 86th position with a net worth of $1.3 billion each.
- In April 2016, Sachin Bansal and Binny Bansal were named to Time magazine's list of The 100 Most Influential People.
See also
- E-commerce in India
- Online shopping
External links
- Official website
BY : HARSH SINGH NEGI
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