Successful Marketing Management Of Flipkart

MAIN BODY

Marketing refers to the set of activities that are used for communicating information as well as the importance of a commodity to influence customers to purchase a product or service. Marketing management is defined as the process of analyzing, planning, applying, and controlling the program designed for approaching the target market and for achieving the desired outcome. Flipkart is an online retailer in India that sells its products or services using its website throughout the world.

Background:-

E-commerce refers to the buying and selling of goods or services online with the help of the World Wide Web. The e-commerce market is considered to be one of the most powerful and fastest-growing sectors of the world. With the emergence of information technology, the e-commerce market has also gained popularity in India, and this revolution has changed the whole scenario of doing business in the country. The Indian e-commerce market is now expected to grow up to US$ 200 billion by 2026. The introduction of smartphones, 4G networks, and increasing customer wealth are considered to be the main reasons behind the popularity of the e-commerce market in India. With the e-commerce revolution, several retail companies also started selling their products or services online to achieve higher revenue and sales (Fernandez, Le Roy, and Gnyawali, 2014). Retail companies like Flipkart, Snapdeal, Amazon, etc. are the greatest promoters of e-commerce businesses in India. According to the present scenario, online retail sales in India are expected to increase by 31% in the upcoming year.

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Apart from this, the government of India also promoted the use of e-commerce by providing various opportunities to businessmen by initiating several schemes: Digital India, Make in India, Start-up India, and the fund. In these schemes, the government provides loans to small businesses so that they can expand their business over an e-commerce platform. The timely implementation of these programs supports the growth and existence of e-commerce in India.

Flipkart Pvt. Ltd is one of the largest Indian E-commerce companies, headquartered in Bengaluru. It was founded by Sachin Bansal and Binny Bansal in 2007, when they used to sell books online. It was the riskier decision taken by them to sell products online, as at that time e-commerce did not exist. After gaining popularity, the company expanded its business into other product categories, such as mobile phones, music, movies, etc. With the momentum gained by e-commerce in India, Flipkart started offering different ranges of products, and now it offers more than 80 million product categories, which include computers and accessories, laptops, books, lifestyle products, home appliances, electronic goods, baby care, toys, jewelry, and many more (E-commerce Industry in India, 2018).

Flipkart positioned itself as a customer-friendly and trustworthy e-commerce brand by launching its 'cash on delivery' services. This option helps in developing confidence as well as trust among online buyers. As they hesitate to pay online or disclose their financial information on web pages. Cash on delivery options influence the target market up to a large extent for purchasing products online. Further company also puts more effort toward improving the supply chain system for delivering products or services in a timely manner. This positioning helped Flipkart maximize its customer share in the market, and now the company has more than 100 million registered customers. 

Apart from this, this company's unique selling proposition also supports the company to achieve such heights in the e-commerce industry. Flipkart targeted customer support services as their USP, where more than 2500 staff work 24/7 to offer better services to their customers (Flipkart Company Profile, 2016). It also manages its own supply chain, which includes warehouses and distribution centers across 13 cities in India. Other USP of Flipkart are quality and original products, genuine Feedback & ratings, etc. These unique selling propositions assist Flipkart in achieving popularity and building trust among target customers.

Market audit of Flipkart

market audit refers to the process of thoroughly reviewing the firm's marketing approach and activities and aims to determine the potentiality and viability of current market strategies. It includes evaluation of the business environment both internally as well as externally, which further helps the company identify the areas of improvement. These findings help in formulating the plan, which supports enhancing the performance of the company. This analysis can be better performed using two analytical tools, such as SWOT or PESTEL, which help in accessing the current market condition and strategies to be formulated for further growth of the company.

SWOT analysis of Flipkart:

Swot is an analytical and strategic tool that helps in accessing the business environment to formulate growth strategies and eliminates various threats that may affect the functioning of the business. It is abbreviated as Strength, Weakness, Threat, and Opportunities. This analysis will help Flipkart identify the actions to be taken to improve their weaknesses and eliminate threats that may affect its operations (SWOT analysis of Flipkart, 2018). Further, it also supports grabbing the opportunities that are present in the market, which takes it to new heights. The following table describes the SWOT of Flipkart:

PESTLE analysis:-

It is an analytical tool that is used by companies to identify various factors present in the external environment that have a direct impact on the operations of the firm. By using this analysis, the company can formulate strategies that help them in dealing with threats that are present in the external environment and may hinder the functions of the company. This tool consists of six macro-environmental factors such as political, legal, social, technological, legal, and environmental (Iacobucci, 2014). By using this analysis tool, Flipkart can identify various threats that are present in the external environment and need to be considered while performing business activities. Further, it also helps in identifying various opportunities present in the external environment, which supports Flipkart in expanding its business and in achieving higher growth. The following points show the pestle analysis of Flipkart:

• Political: It includes factors related to governmental regulation and political stability which may affect the operations of the Company. It includes government policies, tax policies, trade restrictions, etc. government of India is currently planning to boost the economy of rural areas by promoting digitalization in each area of the country. To promote this growth, the government of India provides various schemes, such as Digital India, Make in India, and the Innovation Fund (Karjaluoto, Mustonen and Ulkuniemi, 2015). This has opened up a number of opportunities for Flipkart, as they can sell their products to another untapped part of the country. Apart from that, it also brings some threats for the company, as new regulations may be formulated for the E-commerce industry to promote economic growth, which leads to modification in the business operations of the company. Further, this step of the Indian government also opens up the entry optionfor for  other international retailers such as Amazon, eBay, etc. which increases the competition in the market.   
• Economical: It includes factors such as economic growth, exchange rate, inflation, disposable income, interest rate, etc. which affect the profitability and way a business operates. The e-commerce industry in India is one of the fastest-growing sectors and also brings a number of opportunities for Flipkart to grow. The increase in income level of people living in India leads to an increase in demand for commerce platform for purchasing and selling goods or services. Further, other positive factors help in promoting the growth of Flipkart, such as an increase in the living standard of the population, literacy related to information technology, less tax over online purchases, and a busy schedule. These all factors lead to maximizing the use of online platforms to make purchases.
• Social:-It is also known as sociocultural factors, and it includes shared beliefs, values, and attitudes possessed by customers. These factors affect the demand for a company's product or services.  Plans of the Indian government toward spreading knowledge and literacy regarding the use of computers and the internet prove to be a better opportunity for Flipkart to exert their services to rural areas (Kowalkowski et. al., 2015). Further company also focuses on improving and delivering better customer support services to maximize the level of customer satisfaction. The company has more than 2500 staff members who work toward providing services and solving the queries of customers 24/7. This helps them build trust among customers.

Apart from this, Flipkart is also taking a step toward improving the work life of their employees by contributing toward daycare expenses for their parents; maternity leaves are also revisited. In addition to this, the average age of employees working on Flipkart is 29 years, which provides better solutions as well as trending practices that help in delivering better services.

• Technological: It includes factors like changes in technology used, new methods of producing or distributing products, technological upgrades, and innovation. These factors have a direct impact on the way in which a company markets its products or services. With the increasing demand for using a smart phone, the company started offering their product or services over their mobile application. It is assumed that Flipkart will go all mobile in the upcoming future (Lovelock and Patterson, 2015)  In addition to this, mobile apps also allow their users to use more customized and easier payment methods, which increases visitors. Apart from this, the company also provides innovative products or services to their customers to maintain the number of visitors to their website. It includes newly launched mobile phones and other electronic items.
• Environmental factors include changes in the weather condition as well as various laws related to the safety and protection of the environment which are required to be followed by a company to market its product in that geographical area. Flipkart is not involved in any sort of activities that harm the environment as it performs its business operations using an e-commerce platform. Rather, it encourages the consumption of more products or services by adopting various sales promotion activities to attract customers to buy more.
• Legal: This factor includes various laws and regulations such as health & safety law, advertising standards, consumer rights & law, employment law, product labeling & product safety. A company needs to identify various laws that are required to comply with to operate their business effectively and legally (Lusch and Vargo, 2014). There are several legal issues faced by Flipkart that affected the reputation of the company. This includes fake products delivered to customers from the suppliers that lead the buyer to file a case of fraud against the company. Secondly, Zomato's breach resulted in the theft of client data, which increased the concern of the company toward developing the ability to protect consumer data. This led Flipkart to be more aware of the property rights and trademark practices.

Further, the growth of the e-commerce industry also increased various types of government laws and regulations implemented over companies like Flipkart, which affected the operations of the company. It includes new changes in the GST tax of India, which leads to an increase in the rate of selling online products. This leads to a decrease in the revenue of the company.

From this above market analysis, it can be determined that there are various threats present in the environment that may affect the operation as well as the profitability of the company. This includes changing government regulation & taxation policies, increasing number of competitors, lowering the switching rate of customers, etc. But apart from this, there are number of opportunities which are present in environment that help companies achieve higher growth (McColl-Kennedy et. al., 2015). It includes increasing living standard & income level of population, governmental support toward digitalization and increasing use of smartphones. These all factors provide numerous growth opportunities to Flipkart in Indian e-commerce market.

Marketing mix actions

The marketing mix refers to the set of strategic activities or actions taken by a company that help in promoting the product or brand in the marketplace. These strategies help the company achieve a higher market share, which in turn will increase the volume of sales. Further, it also helps companies manage their strategies with current market trends. The marketing mix consists of seven elements, which are as follows:

• Product: Flipkart is an online retailer company based in India that offers a number of products or services ranging from lifestyle products to electronic items. It deals in more than 80 million consumer product categories, which is the main reason behind its largest market share in the Indian e-commerce industry. But the increasing popularity and usage of the internet leads people to search for each product or service online. Therefore, it increases the use of online websites for purchasing commodities (Morschett, Schramm-Klein, and Zentes, 2015). So in order to keep up with the demand of the external environment, a company is required to maintain its stock to fulfil the demand of customers. Due to higher brand recognition and number of visitors, products get easily outdated. An increase in the stock volume leads to a decrease in customer switching, which provides maximum revenue. But apart from this, it also leads to an increase in the inventory cost of Flipkart. 
• Price: Flipkart has developed its strongest marketing model, which helps them in competing with other e-commerce players.  In this model, the company generally minimizes the price of their product by forcing them to compete among themselves for achieving higher revenue. This leads sellers to decrease the price of products, which results in increasing the number of customers (Papadopoulos and Heslop, 2014). Apart from this, the company also offers 1-day delivery services to their prime customers but charges extra service and installation amounts. An increase in competition leads to minimizing or eliminating the cost of delivery, attracting customers to purchase products. But on the other hand, Flipkart charges a minimum 500 Rs. as a delivery charge, which leads to buyers switching. So, the company is required to minimize its delivery charges, which are higher than those of competitors. This will help in reducing customer switching, but on the other hand, it will increase the cost of the company. 
• Place:-Flipkart is one of the greatest electronic commerce companies, with headquarters in Bangalore, India. It offers a wide variety of products or services across various areas of the country, with more than 80 million product categories. It has a number of distributor centres in more than 13 cities in India. But the emergence of globalisation and the use of the internet leads to an increase in the use of e-commerce platforms for purchasing or selling the product (Yang and Su, 2014). This leads to an increase in competition in this industry, and in order to cope with this situation, Flipkart is required to expand its business in other countries. This helps in restricting the competitors to destroy the demand for Flipkart's product. But on the other hand, it leads to an increase in the cost of exchange, inventory, operation cost, etc. 
• Promotion: For promoting its product, Flipkart currently uses Google, SEO, and AdWords services, which lead customers to search for their product as well as download a mobile application. This app helps customers get alerts about new products, order status, current offers, and various gift coupons (Sandberg and Aarikka-Stenroos, 2014). It also uses TV commercials for displaying their creative and interesting advertisements. But on the other hand, competitors are using various other sources to promote their brand, such as social media sites. Therefore, in order to keep up with current demand Flipkart is required to modify its promotion activities by adopting different channels of communication to promote their brand such as social media (Smith, 2016). This step will help in approaching the youth, which are considered to be the largest segment for the e-commerce market.
• Process: Flipkart uses several business processes for ensuring the smooth execution of services to customers. When a person opens up the webpage of Flipkart, the offers and products are categorised over the home page. By using these options, customers can select the product of their choice. After selecting the product, they can either add it to the cart or buy it by clicking the over-purchase option. When an order is placed, the product is packed, processed, and shipped from the center, which sends it to customers places through distributors. This process includes a number of mediators through which products pass on, which increase the time of delivery. Further, it also leads to replacement of the original product, which affects the goodwill of the company. Hence, Flipkart is required to improve its current process in order to reduce the time of operations.
• People: Flipkart focuses more on delivery and better services by hiring a large number of employees, which work toward solving the issues of customers and providing a better shopping experience. These employees work 24/7 to solve all the problems faced by customers while purchasing or using products or services. But as their increase in use of advanced technology leads companies to fail in various areas of operation, which include customer security, failure of network over the internet, and hacking of data (Swani, Brown, and Milne, 2014),. This requires the company to recruit employees that have an IT background, which leads them to solve network security and other related issues quickly. But along with this, it also somewhere increases the cost of recruitment as well as training & development costs.
• Physical evidence: Flipkart uses its own web page to sell its products or services online throughout the country. It designs its website in such a way that customers can easily get the product they are searching for. A number of options or categories are placed over them, which leads them to filter the product, brand, and quantity they want (Wu, 2014). But on the other hand, this website is managed properly. As during its sales promotion, ads of offers get popped up everywhere, which leads customers frustrated and they exit the app. So the company must manage their website properly so that customers don't get confused and frustrated. 

CONCLUSION

From the above report, it can be summarized that it is very essential for a company to manage its marketing activities, which help them achieve higher success. It also helps in determining various factors that are required to be improved in order to improve their current marketing strategy. In order to analyse the internal and external environment, SWOT as well as PESTLE are considered to be the best analytical tools. These tools assess the various opportunities that help in the further growth of a company. 

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REFERENCES

Baker, M. J., 2016. What is marketing?. In The Marketing Book (pp. 25-42). Routledge.

Fernandez, A. S., Le Roy, F. and Gnyawali, D. R., 2014. Sources and management of tension in co-opetition case evidence from telecommunications satellites manufacturing in Europe. Industrial Marketing Management. 43(2). pp. 222-235.

Guesalaga, R. (2016). The use of social media in sales: individual and organizational antecedents, and the role of customer engagement in social media. Industrial Marketing Management. 54. pp. 71-79.

Hakansson, H., 2015. Industrial Technological Development (Routledge Revivals): A Network Approach. Routledge.

Iacobucci, D., 2014. Marketing management. Cengage Learning.

Karjaluoto, H., Mustonen, N. and Ulkuniemi, P., 2015. The role of digital channels in industrial marketing communications. Journal of Business & Industrial Marketing. 30(6). pp. 703-710.

Kowalkowski, C. and et. al., 2015. What service transition? Rethinking established assumptions about manufacturers' service-led growth strategies. Industrial Marketing Management. 45. pp. 59-69.

Lovelock, C. and Patterson, P., 2015. Services marketing. Pearson Australia.

Lusch, R. F. and Vargo, S. L., 2014. The service-dominant logic of marketing: Dialog, debate, and directions. Routledge.

McColl-Kennedy, J.R., et. al., 2015. Fresh perspectives on customer experience. Journal of Services Marketing. 29(6/7). pp. 430-435.

Morschett, D., Schramm-Klein, H. and Zentes, J., 2015. Strategic international management (pp. 978-3658078836). Springer.

Papadopoulos, N. and Heslop, L. A., 2014. Product-country images: Impact and role in international marketing. Routledge.

Sandberg, B. and Aarikka-Stenroos, L., 2014. What makes it so difficult? A systematic review on barriers to radical innovation. Industrial Marketing Management. 43(8). pp. 1293-1305.

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