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> I am not sure what will be their (Flipkart’s) value proposition. You are missing out on the whole forest. If you think Amazon was an innovation, solving for

by achow 11y ago

> I am not sure what will be their (Flipkart’s) value proposition. You are missing out on the whole forest. If you think Amazon was an innovation, solving for ‘hate to go out for shopping’ scenario, then ecommerce in India is 100X of that innovation. It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a SD card for mobile, or a particular book, or that latest Levis, sneakers, and so on… Heck even in big cities it is a struggle to find things. The local business that you are mentioning who do home delivery is for day to day things, doesn’t extend beyond ordinary grocery items. Now why Flipkart still has an advantage? It is simply because it had first mover's advantage. Its brand is well settled in the mind of people, particularly if you consider non urban towns and villages. Those people have simple mind, once a brand settles in their life it is very difficult for another one to replace it. Amazon et al will need to work 10X hard to replace Flipkart from their habits. Another angle is - mobile. At the afore mentioned places, the primary device for online shopping is mobile. Now if an app has entered into their device and they have gotten used to it (mind you these folks are not as tech savvy, smart yes but not tech savvy as they never owned a PC before), it becomes very difficult for another online retailer’s app to replace the app that they are used to. Flipkart still has lot of advantage over Amazon, Snapdeal due to its brand recall (still today if you walk out of city area, online shopping means Flipkart to majority of Indians - almost same as what Xerox is to Photocopy). That is their value proposition (to investors).

geodel 11y ago
> Those people have simple mind, once a brand settles in their life it is very difficult for another one to replace it. This sounds offensive and it is obviously not true in my first hand experience. The main issue is cost effectiveness once merchandise is not heavily discounted. One good example is telecom. There is no brand loyalty even in remote areas as people keep changing already cheap prepaid plans for something cheaper. See this: http://www.gartner.com/newsroom/id/1963915 http://www.gartner.com/newsroom/id/1963915 > At US$40, the ARPU in India is among the lowest in the world and about one-third of that of China Much less talked advantage in India is extremely cheap labor who deliver merchandise to homes, and that is available to any new competitor. Flipkart/Snapdeal etc are not much different from Indian IT industry which talked a lot about innovation. However it was(is?) mainly about 1/3rd or less cost comparable to west. But for E-comm it is going to be worse as all/most of their customers are in India.
adventured 11y ago
First mover advantages are weak, at best. A second mover that executes better and or has a meaningfully superior product or value proposition will win just about every time. See: Atari (Nintendo), Friendster (FB), MySpace (FB), Motorola (Apple, Samsung, Nokia), AltaVista (Google), Nintendo (PlayStation), Apple (Windows), Microsoft (iPhone, iPad, Android), Betamax (VHS), RealMedia, Ford (GM), Walkman (iPod), 3dfx (nVidia), Yahoo, AOL (open web), Hotmail, Woolworth's (Sears), Kmart/Kresge and Sears (Wal-Mart), US Steel, Blockbuster (Netflix), Kodak & Polaroid (digital), Sun Microsystems, Xerox, Borders & BN (Amazon), Blackberry & Nokia (iPhone), VisiCalc (Excel), Lotus Notes (MS Office). All examples of first/early movers that got displaced.
flangloria 11y ago
>It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a SD card for mobile, or a particular book, or that latest Levis, sneakers, and so on… Heck even in big cities it is a struggle to find things. This is so true. Even today. Moreover there is an impression of complete lack of transparency in brick and mortar stores, since you are never sure when a shopkeeper is fleecing you. But sadly Flipkart has pivoted away from customer satisfaction to seller satisfaction as an end goal. As a result their quality of service has gone for a toss, whereas Amazon has always been single mindedly pro-buyer. Brand inertia will help them retain customers for some time and this also helped because Amazon's android app is just not good enough, but eventually they will crash if they keep ignoring customers.

by achow 11y ago

geodel 11y ago

> Those people have simple mind, once a brand settles in their life it is very difficult for another one to replace it. This sounds offensive and it is obviously not true in my first hand experience. The main issue is cost effectiveness once merchandise is not heavily discounted. One good example is telecom. There is no brand loyalty even in remote areas as people keep changing already cheap prepaid plans for something cheaper. See this: http://www.gartner.com/newsroom/id/1963915 http://www.gartner.com/newsroom/id/1963915 > At US$40, the ARPU in India is among the lowest in the world and about one-third of that of China Much less talked advantage in India is extremely cheap labor who deliver merchandise to homes, and that is available to any new competitor. Flipkart/Snapdeal etc are not much different from Indian IT industry which talked a lot about innovation. However it was(is?) mainly about 1/3rd or less cost comparable to west. But for E-comm it is going to be worse as all/most of their customers are in India.

adventured 11y ago

First mover advantages are weak, at best. A second mover that executes better and or has a meaningfully superior product or value proposition will win just about every time. See: Atari (Nintendo), Friendster (FB), MySpace (FB), Motorola (Apple, Samsung, Nokia), AltaVista (Google), Nintendo (PlayStation), Apple (Windows), Microsoft (iPhone, iPad, Android), Betamax (VHS), RealMedia, Ford (GM), Walkman (iPod), 3dfx (nVidia), Yahoo, AOL (open web), Hotmail, Woolworth's (Sears), Kmart/Kresge and Sears (Wal-Mart), US Steel, Blockbuster (Netflix), Kodak & Polaroid (digital), Sun Microsystems, Xerox, Borders & BN (Amazon), Blackberry & Nokia (iPhone), VisiCalc (Excel), Lotus Notes (MS Office). All examples of first/early movers that got displaced.

flangloria 11y ago

>It for simple reason that for vast majority of Indians (non-urban, big and small towns, villages etc.) there is simply no alternative if they want to buy a mobile or a SD card for mobile, or a particular book, or that latest Levis, sneakers, and so on… Heck even in big cities it is a struggle to find things. This is so true. Even today. Moreover there is an impression of complete lack of transparency in brick and mortar stores, since you are never sure when a shopkeeper is fleecing you. But sadly Flipkart has pivoted away from customer satisfaction to seller satisfaction as an end goal. As a result their quality of service has gone for a toss, whereas Amazon has always been single mindedly pro-buyer. Brand inertia will help them retain customers for some time and this also helped because Amazon's android app is just not good enough, but eventually they will crash if they keep ignoring customers.