E-Commerce: Indian Giant Flipkart Betting on Mobile

By August 06, 2015

During his session at the MobileBeat event held in San Francisco on July 13-14, Punit Soni, Chief Product Officer at Indian e-commerce specialist Flipkart, pointed to some of the specific features of India’s e-commerce market and explained why the company is hoping to capitalise on the surge in mobile technology in the country.

Set up in 2007 by two former Amazon employees, Flipkart has in less than ten years become the largest e-commerce site in India. Backed by leading investment funds such as Accel Partners and Tiger Global Management, Flipkart today accounts for 40 - 50% of e-commerce volume in India and is valued at around $15 billion. In April the site unexpectedly announced that it was to close its mobile website and switch entirely to an app-based platform, thus making it a must for users to download the app if they want to use the mobile e-commerce service.

The decision, which surprised many people, is rooted in the company’s determination to keep in step with the Indian e-commerce market, which is moving towards becoming exclusively mobile. In June last year only 20% of Flipkart transactions went through a mobile device. Today mobile devices account for fully 70% of all transactions on the site.


Capitalising on the rise of mobile connections in India

Mobile devices are becoming an ever-more ubiquitous part of Indian daily habits. ‟India has moved directly from the Internet to mobile, missing out all the intermediate phases,” Punit Soni told the MobileBeat audience. Out of a current population of 1.25 billion inhabitants, 75% now have a mobile phone subscription. This is good news for the m-commerce market in India which, according to market research specialist Forrester Research, will be worth $19 billion by 2019. India also has the advantage that, despite major infrastructure problems, it can hold its own vis-a-vis the United States when it comes to innovation in the mobile field. The Indian ecosystem boasts many highly successful startups whose business is based on mobile technology, including Ola, an Uber lookalike which has already raised $676.8 million; Hike, a mobile messaging platform which has received over $86 million in investment; and Zipdial, a startup selling mobile marketing solutions specifically designed for the Indian market, which was acquired by Twitter in February this year.

Recently Flipkart has been mainly focusing its efforts on developing its mobile app, which could soon become the only means of shopping online on the company’s platform. Given that the majority of mobile shoppers are Flipkart users, this means it can interact with customers very effectively via such tools as push notifications. The mobile app is also able to gather more relevant data, notably including geolocation data, which enables Flipkart to make more tailored product offers to users.

Mobile innovations to match India’s specific features

Flipkart’s primary aim is to adapt to the specific features and habits of the Indian market. For instance, a large percentage of the Indian population do not have access to banking facilities, which is a severe obstacle to the growth of e-commerce. To address this problem, Flipkart has launched a COD option –allowing customers to order online and pay in cash when the item is delivered to their door. ‟E-commerce is a boon for India, where a large part of the population still live in rural areas. It’s their only way of actually getting hold of certain types of products,” Soni underlined.

Adoption of mobile devices is now a reality in India, but everything still remains to be done to develop the e-commerce and m-commerce markets in the country. Online shopping currently accounts for only 1% of the retail sector there, which spells huge growth potential for Flipkart. Accordingly, the firm is pushing to bring an increasing number of merchants on to its site through special offers – such as doing away with commission in order to encourage new online merchant accounts, plus education and assistance programmes to make the signing-up process easier.

Another area that is in full swing for Flipkart is data analysis and machine learning. In July Flipkart started to work in partnership with ViSenze, a Singapore-based start-up specialising in machine learning and visual recognition. Using ViSenze technology, Flipkart can now enable potential customers to upload to the website pictures of clothes they like and obtain recommendations for items of similar colour or style.

Flipkart hopes that this visual search tool will help to bring some of the advantages of the physical retail experience to mobile shopping and make searches on mobile more intuitive. At the MobileBeat event, Punit Soni pointed out another potential benefit: by analysing all the photos uploaded on to the Flipkart platform, the company will be able not only to enhance the platform with recommendations for products which suit its users better, but also to spot emerging fashion trends.

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