Study On Consumer Perference On Amazon and Flipkart
Study On Consumer Perference On Amazon and Flipkart
SERIAL
NO. CONTENTS PAGE NO.
1.INTRODUCTION 3-4
2.1 AMAZON 5
2.2 FLIPKART 6
2.2.3 Achievements 6
2.2.4 Failure 6
3. LITERATURE REVIEW 7-8
5.RESARCH METHODOLOGY 19
7.1 Findings 42
7.2 Suggestions 43
7.3 Conclusions 44
8.ANNEXURES 45
9.APPENDIX 46-49
1
ABSTRACT
INTERNET became more powerful and basic tools for every person’s need and the way people
work by integrating various online management tools using internet, innovative companies
have set up the payment system for taking customer orders, facilitate making of payments,
customer service, collection of marketing data, and online feedback respectively. These
activities have collectively known as e- commerce or Internet commerce. Online shopping
made so easy for everyone with their product variations and simple way to buy things.
An attempt has been made to critically examine various corporate and business level strategies
of two big e-tailors and those are Flipkart and Amazon. Comparison have been done
considering e-commerce challenges, their business model, funding, revenue generation,
growth, survival strategies, Shoppers’ online Shopping experience, value added differentiation,
and product offerings. Both these big players made their own mark in India, but who is going
to be ultimate winner or be the top one is going to be.
A comparative study of Flipkart.com with one of the close competitor Amazon.com delivers
the information about the different strategies to succeed in e-commerce market and different
opportunities available in India.
2
CHAPTER 1
INTRODUCTION
Ever since internet has been introduced to the world, it has made a huge impact on people;
business is one of such example where internet has made the difference. In July 1995
Amazon.com started selling books online and the response they received was unexpected as in
short time span books sold online in all 50 states of USA and 45 countries. Amazon presently
offers music, movies, toys; electronics and home equipment, there are seven different
international websites of Amazon with distributed customer service centres in seven countries
and over 17,000 people work in Amazon workwise. Today there are over 100 popular
ecommerce websites are providing online services workwise. An e-commerce opens the global
market to the customer, it helps the customer by providing huge options while buying a product
or a service, the online searching and comparing facilities enables customer to select right
product or service, another major advantage of e-commerce is that it is 24x7 available to the
customer the customer can shop almost anything within his/hers comfort zone just by sitting at
home, office, during travel or almost from any place at any time.
E-commerce is trading of services and products with the help of internet. E-commerce
introduced in the end of 70s and became popular during the 90s in western countries like USA
and UK. E-commerce introduced new possibilities in trading and attracted attention of many
consumer's E-commerce offers products and services through websites, a customer simply has
to visit an ecommerce website and browse various offering through browser catalog, a customer
can select multiple offerings and can add them to the shopping cart, once the shopping is done
the customer can checkout and proceed to payment section where various online payment
options are available like internet banking, credit card, debit card etc. Once payment is done
the customer is notified about the order and order is shipped on the postal address provided by
the customer
WHAT IS AN ECOMMERCE PLATFORM?
Ecommerce has emerged as the single biggest growth driver in the worldwide marketplace.
EMarketer, a leading independent market researcher, predicts global B2C ecommerce sales will
reach $1.5 trillion this year, a 20 percent increase from 2013. And according to Forrester
Research, B2B ecommerce spending in the U.S. alone reached $559 billion in 2013. If
ecommerce is important to your business then the solution you choose is arguably one of the
most important business decisions you will make. At its simplest form, ecommerce software
enables a business to sell products and services online. Traditionally, businesses had to purchase
on premise, standalone ecommerce software that required extensive IT setup and in-house
management with specialized development teams. These solutions were generally costly, not
scalable, challenging to work with, and time consuming to customize and integrate with other
systems. Ecommerce software provides the customer facing front end component of an online
business. Online businesses, like all other businesses, need additional software to manage back
end functions such as accounting, order management, inventory management, and customer
service. Piecing together different software solutions to create a complete ecommerce business
platform is complicated, requires frequent maintenance and rarely functions efficiently.
Fortunately, a new breed of business software integrates all the needed commerce and business
functionality into a single ecommerce platform via a software-as-a-service (SaaS) model. With
an infrastructure that unifies business applications and the data that feeds them, it is possible to
create relevant, engaging and personalized online experiences. Imagine an ecommerce platform
that allows customer service reps to have a single view of a customer across all channels, a
3
centralized order and inventory management system that can efficiently fulfil orders from all
your sales channels, including brick and mortar stores, or utilize a customer's order history data
to provide personalized and relevant offers. The possibilities brought to light with the advent
of a complete ecommerce platform for business optimization and improved efficiencies as well
as deepened customer engagement and satisfaction are limited only by one's creativity.
• E-commerce businesses may also employ some or all of the followings:
• Online shopping for retail sales direct to consumers via Web sites and mobile apps, and
conversational commerce via live chat, Chabot’s, and voice assistants
• Providing or participating in online marketplaces, which process third-party business
to-consumer or consumer-to-consumer sales
• Business-to-business buying and selling;
• Gathering and using demographic data through web contacts and social media
• Business-to-business (B2B) electronic data interchange Marketing to prospective and
established customers by e-mail or fax (for example, with newsletters)
• Engaging in prevail for launching new products and services
• Online financial exchanges for currency exchanges or trading purposes.
• Key Features of an Ecommerce Platform
Any viable ecommerce software will enable customers to buy your products and services from
your online store. Where solutions differ is the degree to which they can unify and leverage
both front and back-office applications with both their unique and shared data. Ecommerce
platforms provide the unification of core business processes, where businesses can gain
complete visibility across their company and ultimately meeting their most discerning
customers' expectations. An ecommerce platform should: Run on a single, unified platform.
Eliminate integrations between separate systems with natively unified ecommerce, accounting,
POS, inventory and order management, marketing, merchandising, customer service and
financials on a cloud-based platform. Provide a 360? customer view. Deliver consistent and
personalized cross-channel experiences, targeted marketing and superior customer service with
a single view of all customer interactions and transactions across all touch points and channels.
Intelligently managing orders. Exceed and set new customer expectations for buying, fulfilling
and returning purchases, both online and in stores. Maximize profitability by centralizing order
management and having a single view of inventory across all channels and supply chain
business units. Deliver innovative customer experiences. Rapidly create unique, personalized
and compelling mobile, web and in-store experiences to differentiate your brand and exceed
customer expectations. Support unlimited expansion. Quickly deploy sites for multiple business
models, channels, brands, countries, currencies and languages all on the same platform.
An ecommerce platforms include all core business functions, integrated into a single solution;
it fosters improved collaboration, aligns operational processes and provides real-time data
visibility across entire organizations. This integrated platform drives the following functions in
a cohesive manner:
• Analytics and reporting
• Customer support
• Order and inventory management
• Procurement
• Content management
• Marketing
• Pricing and promotions
4
CHAPTER 2
COMPANY PROFILE
2.1Amazon:
2.1.1 History and Growth of Amazon
Amazon.com, founded by Jeff Bezos in 1994, is an American electronic commerce company with headquarters
in Seattle, Washington. Jeff Bezos incorporated the company as “Cadabra” on July 5, 1994, and the site went
online as Amazon.com in 1995. Bezos changed the name cadabra.com to amazon.com because it sounded too
much like cadaver. Additionally, a name beginning with “A” was preferential due to the probability it would
occur at the top of any list that was alphabetized. It is the largest Internet based company in the United States.
Amazon.com started as an online bookstore, but soon diversified, selling DVDs, VHSs, CDs, video and
MP3Downloads/Streaming, Software, Video Games, Electronics, Apparel, Furniture, Food, Toys, and
Jewellery. The company also produces consumer electronics notably, Kindle, Fire Tablets, Fire TV and Phone
and is a major provider of cloud computing services. Amazon has separate retail websites for United States,
United Kingdom & Ireland, France, Canada, Germany, The Netherlands, Italy, Spain, Australia, Brazil, Japan,
China, India and Mexico, with sites for Sri Lanka and South East Asian countries coming soon. Amazon also
offers international shipping to certain other countries for some of its products. In the year 2011, it had professed
an intention to launch its websites in Poland, and Sweden. In early June 2013, Amazon.com had launched their
Amazon India marketplace without any marketing campaigns. In July, 2013, Amazon had announced to invest
$2 Billion (Rs 12,000 Crores) in India to expand business, after its largest Indian rival Flipkart too had announced
to invest$1 Billion.
2.1.2 EXCLUSIVE PRODUCTS
The Amazon kindle is a series of readers designed and marketed byAmazon.com.Amazon kindle devices enable
users to browse, buy, download and read eBooks, newspapers, magazine sand other digital media via wireless
networking to the kindle store. The hardware platform, developed by Amazon subsidiary lab 126, began as a
single device and now comprises a range of devices, including e-readers with e ink electronic paper displays, and
android- based tablets with colour lcd screens.
All kindle devices integrate with the kindle store to acquire content and as of February 2016, the store has over
4.3 million e-books available in the us. The one plus one launched as an Amazon exclusive in India last year, but
now the device is available for purchase on rival e-commerce store Flipkart. Moto g (gen 4) and moto g plus
(gen 4) will be available exclusively on Amazon.
2.1.3Achievements in E-Commerce
On the mobile app side, Amazon had the fastest growing app download rate in 2015. In October alone,
downloads increased 200 per cent. Amazon web traffic was the highest in October as per com score data, at 30
million visitors. Amazon active customers have gone up 230 per cent year on year. The awards were conferred
at e-tailing India's flagship conference and exhibition 2014, an event that brought together major stakeholders in
the retail and ecommerce business in the country. The "path-breaking debut of the year" award went to Amazon
in.
2.1.4 Failure
Amazon starts using India post and screws up its delivery system in India. At the time when the competition
among online shopping portals in India is at its highest level possible and each player is pooling in millions from
5
funding's and trying to beat each other with never-before discounts and amazing services, Amazon has taken the
worst step ever possible. Amazon India has chosen India post as its primary delivery partner and all
2.2 Flipkart:
2.2.1 History and growth of Flipkart
It is an e-Commerce company founded in the year 2007, by Mr. Sachin Bansal and Benny Bansal both alumni
of the Indian Institute of Technology, Delhi. They had been working for Amazon.com previously. It operates
exclusively in India, where it is headquartered in Bangalore, Karnataka. It is registered in Singapore, and owned
by a Singapore based holding company. Flipkart has launched its own product range under the name “Digi Flip”,
Flipkart also recently launched its own range of personal healthcare and home appliances under the brand
"Citron". During its initial years, Flipkart focused only on books, and soon as it expanded, it started offering other
products like electronic goods, air conditioners, air coolers, stationery supplies and life style products and e-books.
Legally, Flipkart is not an Indian company since it is registered in Singapore and majority of its shareholders are
foreigners. Because foreign companies are not allowed to do multi-brand e-retailing in India, Flipkart sells goods
in India through a company called WS Retail Other third-party sellers or companies can also sell goods through
the Flipkart platform Flipkart now employs more than 15000 people. Flipkart allows payment methods such as
cash on delivery, credit or debit card transactions, net banking, e-gift voucher and card swipe on delivery. Flipkart
is presently one of the largest online retailers in India, present across more than 14 product categories & with a
reach in around 150 cities. Flipkart is currently a 10,000 member strong team, with 3000 sellers on its platform
and delivering 5 million shipments per month.
2.2.2 EXCLUSIVE PRODUCTS
Motorola mobility, previously owned by google but then sol to Lenovo, in an exclusive tie up with Flipkart
launched its budget smart phone moto gin India on 5 February 2014 more than20,000 units were sold within
hours of launch on Flipkart after this Flipkart was booking for along term tie up with Motorola mobility. They
also launched their android smartphone, the MotoX, on 19 march 2014. Flipkart later sold the moto e, cheaper
than moto g, from 13 may 2014. The sale of high-end smart phone xiaomi mi3 produced by xiaomi tech was
launched in India on an exclusive tie-up with Flipkart. The first batch was sold out within 39 minutes on 22 July
2014, the second in 5 seconds on 29 July 2014. The sale was preceded on preregistration mode where more than
150,000 buyers booked for the 5 august 2014 sale. This got sold off in less than 2seconds. Following this xiaomi
tech sold 20,000 units in the next sale on 12 august 2014.On 2 September 2014 Flipkart hell a flash sale of the
xiaomiredmi Is budget android smart phone which was launched in India in July 2014. 40, 000 units priced at
Rs 5999 each were sold within seconds. A further 40,000 units were sold within 4.5 seconds on sept 9, 2014.
The third Redmi Is sale on sept 16, 2014 sold 40,000 units in 3.4 seconds; in the 4th round of sale of Redmi Is,
60,000 units sold in 5.2 seconds on sept 23, 2014. On 30 September 2014 60,000 units sold in 13.9 seconds.
Redmi note in India exclusively through Flipkart; 50,000 units sold in 6seconds on 2 December 2014. In July
2014 Flipkart launched its own set of tablet, mobile phones& tablet. The first among these series of tablet phones
was Digi flip pro xt 712 tablet.
2.2.3 Achievements in E-Commerce
In September 2015, Sachin Bansal and binny Bansal entered Forbes India rich list debuting at the 86th position
with a net worth of $1.3 billion each. Co-founder of Flipkart, Sachin bansal, got entrepreneur of the year award
2012-2013 from economic times, leading Indian economic daily. Flipkart.com was awarded Young Turk of the
year at CNBC TV 18’s ‘India business leader awards 2012’ (alba). Flipkart.com- got nominated for India mart
ladders of tomorrow awards 2011
.2.2.4 Failure in Music Industry
6
In October and November 2011, Flipkart acquired the websites mime360.com and chakpak.com. Later, in
February 2012, the company revealed its new flyte digital music store. Flute, a legal music download service in
the vein of iTunes and Amazon.com, offered dorm-free
CHAPTER 3
LITERATURE REVIEW
Sharma and Mittal (2009) in their study "prospects of e-commerce in India", mentions that India is showing
tremendous growth in the e-commerce. Undoubtedly, with the middle class of 288 million people, online
shopping shows unlimited potential in India. The real estate costs are touching the sky. Today e-commerce has
become an integral part of our daily life. There are websites providing any number of goods and services. The e-
commerce portals provide goods and services in a variety of categories. To name a few: apparel and accessories
for men and women, health and beauty products, books and magazines, computers and peripherals, vehicles,
software, consumer electronics, household appliances, jewellery, audio, video, entertainment, goods, gift articles,
real estate and services. Ashish gupta, senior managing director aphelion venture partners and one of the first
backers of Flipkart as an angel investor: "Flipkart has been absorbing companies that have some potential
(letsbuy, Myntra). In that process, some of the bets will go wrong, for sure. But that is par for the course. The
company (Flipkart) is consciously taking bets that allow it to either grow or eliminate competition that reduces
marketing spend and improves economics."
Miyazaki and Fernandez (2001) substantiated that the prior experience was found to affect the intention and
behaviour significantly and in a variety of ways. The results of this study imply that the technology acceptance
model should be applied to electronic commerce research with caution. In order to develop a successful and
profitable web shop, understanding customers' needs is essential. It has to be ensured that products are as cheap
in a web shop as purchased from traditional channels. According to Sharma and Mittal (2009) in their study
"prospects of ecommerce in India", mentions that India is showing tremendous growth in the e-commerce.
Undoubtedly, with the middle class of 288 million people, online shopping shows unlimited potential in India.
The real estate costs are touching the sky. Today e-commerce has become an integral part of our daily life. There
are websites providing any number of goods and services. The e-commerce portals provide goods and services
in a variety of categories. To name a few: apparel and accessories for men and women, health and beauty
products, books and magazines, computers and peripherals, vehicles, software, consumer electronics, household
appliances, jewellery, audio, video, entertainment, goods, gift articles, real estate and services. Samadi and ali
(2010) compared the perceived risk level between internet and store shopping, and revisit the relationships
among past positive experience, perceived risk level, and future purchase intention within the internet shopping
environment.
Abhijit mitra. (2013), “e-commerce in India-a review”, international journal of marketing, financial services &
management research. Concluded that the e-commerce has broken the geographical limitations and it is a
revolution-commerce will improve tremendously in next five years in India.
D.k.gangeshwar. (2013),” e-commerce or internet marketing: a business review from Indian context”,
international journal of u- and e- service, science and technology. Concluded that the ecommerce has a very
bright future in India although security, privacy and dependency on technology are some of the drawbacks of e-
commerce but still there is a bright future to ecommerce.
Martin dodge. (1999),”finding the source of Amazon.com: examining the hype of the earth’s biggest book
store”, centre for advanced spatial analysis. Concluded that Amazon.com has been one of the most promising e-
commerce companies and has grown rapidly by providing quality service.
7
Vijay govindarajan is one of the world’s leading experts on strategy and innovation. Govindarajan, coxe
distinguished professor at Dartmouth college’s tuck school of business and Marvin bower fellow at Harvard
business school, is also a best-selling author. The biggest opportunity in India is e-commerce. Why? Three
important factors will drive this: 1) mobile phone penetration; 2) a young demographic that is used to ordering
things using the mobile platform; 3) growth of consumerism with more Indians with higher disposable income.
We will see many new innovative business models in the e-commerce space in the next five years. No doubt we
will see new innovative high-growth companies-Indian equivalents of Alibaba. Pooja Gupta (2015), The study
tries to recognize that, how consumer measure channels for their purchasing. Specifically, it progresses a
conceptual model that addresses consumer value perception for using the internet shopping’s traditional
shopping. Earlier study showed that perceptions of price, product quality, service quality and threat strongly
impact perceived value and purchase intents in the offline and online network. Observations of online and offline
buyers can be evaluated to see how value is constructed in both channels. It is hitherto to recognize what factors
influence online and offline shopping choice progression. The objective of this study is to provide an impression
of online shopping decision process by comparing the offline and online decision making and identifying the
factors that motivate customers to decide whether to do online shopping or go for offline shopping. Consumer's
shop when and where they want, where they are comfortable with the products and the choice of shopping. The
study finds that female are more into online shopping than male.
K Francis Sudhakar (2016), internet became more powerful and basic tool for every person's need and the way
people work. By integrating various online information management tools using internet, various innovative
companies have set up systems for taking customer orders, facilitate making of payments, customer service,
collection of marketing data and online feedback respectively. These activities have collectively known as e-
commerce or internet commerce. Online shopping made so easy for everyone with their product variations and
simple way to but things. An attempt has been made to critically examine various corporate and business level
strategies of two big e-tailers Flipkart and Amazon. Comparison has been done e-commerce challenges, their
business model, funding, revenue generation, growth, survival strategies, shoppers online shopping experience,
value added differentiation and product offerings.
Samadi and Ali (2010) compared the perceived risk between internet and store shopping and revisit the
relationships among past positive experience, perceived experience and future purchase intention within the
internet shopping experience.
Abhijit Mitra (2013), “E-commerce in India a review”, International Journal of Marketing Financial Services
and Management Research concluded that e-commerce has broken the geographical limitations and it is a
revolution. Commerce will improve tremendously in the next five years in India.
D.K. Gangeshwar (2013), “e-commerce or internet marketing: a business review from Indian Context”,
international journal of u- and e- service, science and technology; concluded that e-commerce has a very bright
future in India although security, privacy and dependency on technology are some of the drawbacks on e-
commerce but still there is a bright future to e-commerce.
Dr. Sudha S. (2015), Innovation brings with itself a new set of challenges. The ere tailing form of market was
fairly something unheard of to the Indian consumer in 2007. Flipkart which has created a niche for itself in terms
of market share, goodwill and popularity in the online market to the extent that retailers are coming under threat
because of its discounts and smooth operations. The ascent of Flipkart to capture the online market
8
9
CHAPTER 4
MARKETING STRATEGY
AMAZON
SEGMENTATION
E-commerce giants like Amazon uses demographic & psychographics segmentation to segment
the markets. Amazon’s segmentation is based on actual purchase behaviour: not what people
might have expressed interest in, but what they actually did. Amazon’s micro-level
segmentation targets each customer individually, allowing the company to convert visitors into
long-term, high-value customers. Customer segmentation often involves creating personas who
will buy in a certain way & certain products.
Similarly Amazon targets the middle class & upper class people who have got hands on
experience in the basic technology but don’t have time or prefer convenience overtopping from
the physical outlets. Amazon has successfully positioned itself as a global (go global act local)
e-commerce giant where one can buy anything & get it delivered at any remote locations. Using
the catchphrase #aurdikhao in its most recent campaign in India, it has further helped them
carve a distinct space in the consumer’s mind.
MARKETING STRATEGY
In order to differentiate itself, company acquired many it & e-commerce start-ups like pets.com,
audible.com, junglee.com, imbd.com, zappos.com, woot etc. Which helped them in providing
high value to their customers using existing technology of the acquired partners at low cost?
Amazon has also achieved economies of scale through extensive product offerings which
include
Brand equity in the marketing strategy of Amazon- from being merely an e-book provider
to emerging as the2ndlargest e-commerce company in the world ,Amazon.com has steadily
increased its spending on advertising and promotion to make its brand stronger and have a
10
higher brand equity. By April 2015, the brand of Amazon.com was worth us$ 176 billion. “a
brand for a company is like a reputation for a person. You earn reputation by trying to do hard
FLIPKART
Flipkart's business model is much deeper and much expansive that could possibly elaborate
here. However, a few key points -
•Rationalized supply chain - inbound logistics
•Strategic warehousing and distribution capability - operations
•Well aligned fulfilment process - outbound logistics
All the three processes are extremely well integrated - first by a sound strategy, around which
the organizational structure is built. So they have a strategy, and a complementing structure to
support their strategy. The third critical success factor for Flipkart is the technology as an
enabler. A strong information systems is at the core of the organization, which drives visibility
and end-to-end integration across their supply chain processes (inbound -operations - outbound)
resulting in a well lubricated efficient machine.
Flipkart, must be seen as a logistics company rather than a retail business. Although it sells
products to consumers, and hence is academically classified as a b2c business, the core of the
business lies in its efficient logistics, which allows it to sell products at attractive prices
However, its competitive advantage is not in its retailing capabilities. Infact that aspect of the
e- commerce businesses easily imitable and hence not sustainable. The sustainable competitive
advantage of Flipkart, lies in its logistic sand operations infrastructure - which has a very high
barrier to entry: owing to its extensive capital investment and difficult to replicate strategy-
structure-culture mix.
Cons: potential threat of the original replacing the imitated
11
It is important to reflect upon the fact that its founder members (the Bansal’s) have had an early
stint with Amazon and have successfully modelled Flipkart's business on Amazon strategy. So,
it would be fair to say that Flipkart imitated Amazon's model to an extent.
4.1 SWOTANALYSIS
AMAZON
STRENGTHS
▪ Being the world’s leading online retailer, Amazon derives its strengths primarily from
a three-pronged strategic thrust on cost leadership, differentiation, and focus. This
strategy has resulted in the company reaping the gains from this course of action and
has helped its shareholders derive value from the company.
▪ Amazon primarily derives its competitive advantage from leveraging IT (Information
Technology) and its use of e-Commerce as a scalable and an easy to ramp up platform
that ensures that the company is well ahead of its competitors.
▪ One of the key strengths of Amazon is that it enjoys top of the mind recall from
consumers globally and this recognition has helped it enter new markets, which were
hitherto out of bounds for many e-Commerce companies.
▪ Using superior logistics and distribution systems, the company has been able to
actualize better customer fulfilment and this has resulted in Amazon deriving
competitive advantage over its rivals.
WEAKNESSES
▪ In recent years, Amazon as part of its diversification strategy has been “spreading itself
too thin” meaning that it has allowed its focus to waver from its core competence of
retailing books online and allowed itself to venture into newer focus areas. While this
might be a good strategy from the risk diversification perspective, Amazon has to be
cognizant of losing its strategic advantage as it moves away from its core competence.
▪ As Amazon offers free shipping to its customers, it is in the danger of losing its margins
and hence, might not be able to optimize on costs because of this strategy.
▪ Considering the fact that Amazon is an online only retailer, the single-minded focus on
online retailing might “come in the way” of its expansion plans particularly in emerging
markets.
▪ One of the biggest weaknesses and something that has been oft commented upon by
analysts and industry experts is that Amazon operates in near zero margin business
models that have severely dented its profitability and even though the company has high
volumes and huge revenues, this has not translated into meaningful profits for the
company.
12
OPPORTUNITIES
▪ By rolling out its online payment system, Amazon has the opportunity to scale up
considerably considering the fact that concerns over online shopping as far as security
and privacy are concerned are among the topmost issues on the minds of consumers.
Further, this would improve the company’s margins as it lets it reap the advantages of
using its own payment gateway.
▪ Another opportunity, which Amazon can capitalize on, relates to it rolling out more
products under its own brand instead of being a forwarding site for third party products.
In other words, it can increase the number of products under its own brand instead of
merely selling and stocking products made by its partners.
THREATS
▪ One of the biggest threats to Amazon’s success is the increasing concern over online
shopping because of identity theft and hacking which leaves its consumer data exposed.
Therefore, Amazon has to move quickly to allay consumer concerns over its site and
ensure that online privacy and security are guaranteed.
▪ Because of its aggressive pricing strategies, the company has had to face lawsuits from
publishers and rivals in the retailing industry. The obsessive focus on cost leadership
that Amazon follows has become a source of trouble for the company because of the
competitors being upset with Amazon taking away the business from them.
▪ Finally, Amazon faces significant competition from local online retailers who are more
agile and nimble when compared to its behemoth type of strategy. This means that the
company cannot lose sight of its local market conditions in the pursuit of its global
strategy.
13
FLIPKART
STRENGTHS
WEAKNESS
1. Limited Distribution channel reach: Although its logistics arm has kept
cost’s low, the reach has been affected which is a weakness for Flipkart.
Due to use of outsourcing, Global giants like Amazon & eBay can
deliver the product anywhere in the country. However, Flipkart is still
struggling in this field.
2. Cost of Acquisition: Due to stiff competition in the market &
low customer retention, the cost of Acquisition is high because Flipkart
acquires a lot of customers through online advertising. As per Flipkart
data, the company spends R.s 400/- on acquiring a new customer on an
average.
3. Power in the hand of buyers: Since this industry is flooded with many
players, buyers have a lot of options to choose. Switching costs are also
less for customers since they can easily switch
14
service from one online retail company to another. Same products will
be displayed in several online retail websites. Product differentiation is
almost absent and the fight then begins on the basis of price only.
OPPORTUNITIES
THREATS
15
4.2 ADVERTISING SALES AND PROMOTION
AMAZON
• The main advantage of Handmade at Amazon is a large customer base – over
250Million users.
• An extensive review of the products. Handmade at Amazon attempts to limit the
wholesalers and resellers, as well as mass production. The main emphasis is made on
the real handmade items.
• Free shipping and prime shipping options are available.
• Comparing to the other trading platforms, Amazon provides less competition due to the
smaller amount of products and sellers.
• The interface of Handmade at Amazon is designed for the sale of custom items and is
very usable.
• No difficulties with the tax paperwork because Amazon makes everything for its users.
• Seller support is available by phone.
• Organic Traffic – Drive more targeted traffic to your listings. Become an authority on
the product, use and related interests of what you are selling. Understand your target
market deeply. What do they like, what do they dislike, where do they gather, what
websites do they use etc. The better you understand your target market, the much more
likely you are in being able to help them. Write very high quality articles. Co-publish
on bloggers who work in your industry. Try to get your articles published in sites like
Forbes, fast company, Huffington post etc. As these website will drive a lot of traffic
and also be great for your brand image.
• Build a List – There a thumb rule that you need between ‘8 – 13’ touches before making
an online sales. If you think people would just see your product and buy it, as you know,
most of the time this is not the case. People need reminding, educating and nudging over
periods of time. This is effectively done through emailing. You also lose a LOT of
potential customers from your website if you don’t try to gather their email. Offer
something really worthwhile to get them to sign up. A report on your competition or
whatever, just make sure it helps them and not just to promote your product. In short,
try to offer them real value rather than sales talk.
• Paid Traffic – If paid you need to know your conversion and cost metrics before you
can increase expenditure on advertising. You can use Facebook, google and amazon ads
but the important thing will be to have and tweak your ads and landing page consistently.
• Retargeting – Building on the last two points you can and should use retargeting to get
your potential customers to come back to your website. Reviews – You probably already
know that reviews are one of the most important things to help boost sales. Make sure
to motivate your customers to provide reviews. Follow-up or make it exciting and
worthwhile for them to do so. Be sincere in letting them know that this is what your
business depends on SEO – Make sure, or your best efforts to rank in the top 3 results
of google for at least long tail keywords of your product. Over time increase the number
of long tail keywords and you will find your ranking for more basic and competitive
keywords also increasing.
AMAZON SPONSORED PRODUCTS
Amazon sponsored products are an easy and effective way to target your products to the
potential customers. With the help of amazon sponsored products you can increase the visibility
of your products on amazon but Sponsored products are not enough to convert the traffic
16
conversion into sales. Good performance metrics, Clear product description and bullet points,
High quality images, Promotions such as free shipping, Buy one get one free, Percentage
discounts all help to increase the sales.
Buy Box
The Buy Box is the box on a product detail page where customers can begin the purchasing
process by adding items to their shopping carts. The seller who has the buy box will enjoy the
maximum sales.
Buy Box eligibility is determined by -seller performance metrics, status as a seller, and time
and experience on the Amazon selling platform.
17
FLIPKART:
Good packaging:
The look and feel of your product, when it is delivered to the customer, has a major impact on
buyer experience. Packing products with good packaging material minimises the chances of in-
transit damage. But more than that, it reflects quality service and increases buyers' trust in you
and your brand, which in turn, can increase your sales. We have observed that 52% of buyers
make repeat purchases from sellers who deliver premium packaging, and 5% of buyers expect
their online orders to arrive in premium packaging. Investing in packaging can result in a gain
of 30% more sale.
Better cataloguing:
Your catalog represents your product on the e-commerce website and plays a prime role in
influencing buyers. Having a well-crafted catalog with a crisp description of your products is
crucial to convert the traffic on your products into sales. Remember, most people shop online
to save time and your product description should impress them without making them spend
much time trying to understand your product. Another important element of cataloguing that
can help you increase your sales is adding your product in the right category and sub-category.
This will help buyers search for your products easily and contribute to the traffic.
18
Stock up your inventory:
Inventory is an important part of any retail business and e-commerce is no different. You should
always have a sufficient stock of items and different variantsofyour products to fulfil orders
faster and do more business. Stocking up also keeps you ready for a shopping festival at any
moment.
Deliver on time:
If you want to increase your sales, you must always meet the buyers' expectation whether it is
the quality of the product or time taken to deliver it. Keep products ready for delivery and mark
them RTD (Ready to Dispatch) on time to help our logistics partners deliver your products in
the quickest time possible. Fulfilling a return or exchange request on time is just as important
too to get good customer ratings and reviews.
19
CHAPTER 5
RESARCH METHODOLOGY
OBJECTIVES OF THE STUDY:-
❖To understand and estimate the consumer perception and factors affecting their behaviour for
choosing e-commerce sites.
❖To understand tactics and methods that are used by e-commerce players to grab the customers
in India.
❖To know how consumers are evaluating e-commerce sites for their purchases.
❖To understand the work flow of Amazon and Flipkart which are leading in India.
❖To study complexities and barriers those are there in between e-commerce sites and
customers.
Research Design
Exploratory Research
Exploratory research conducted for a problem that has not been clearly defined. Exploratory
research helps determine the best research design, data collection method and selection of
subjects. It should draw definitive conclusions only with extreme caution. Exploratory research
often relies on secondary research such as reviewing available literature and/or data, or
qualitative approaches such as informal discussions with consumers, employees, management
or competitors, and more formal approaches through in-depth interviews, focus group sand
projective methods.
Descriptive Research
The objective of descriptive research is to describe the characteristics of various aspects, such
as the market potential for a product/company or the demographics and attitudes of consumers
who buy the product with the help of primary data collected.
Data Collection
The goal for all data collection is to capture quality evidence that then translates to rich data
analysis and allows the building of a convincing and credible answer to questions that have
been posed.
Primary Data
Primary data was collected from various people and their opinion and information for the
specific purposes of study helped to run the analysis. In essence, the questions asked were
tailored to elicit the data that will help for study. The data was collected through questionnaire
to understand their experience and preference towards their loyal company.
Secondary Data:
To make primary data collection more specific, secondary data will help to make it more useful.
It helps to improve the understanding of the problem.
Secondary data was collected from various sources such as different business websites and
published papers.
20
CHAPTER 6
DATA ANALYSIS &INTERPRETATION
Amazon 27 54.5%
Flipkart 10 18.2%
3 9.1%
Jio
Total 50 100%
INTERPRETATION:
Ecommerce sides which are most preferred by the customers is So according to the table 75%
and 25% prefer Amazon and Flipkart. On the other hand 18.2% refers Big basket and 9.1%
refers Jio. And the rest of the E commerce site are not even in the reach of Amazon and Flipkart
It clearly proves that Amazon and Flipkart are the leading E commerce sites in India
21
Q2) Which online services is more satisfied in terms of products, customer care and delivery
service?
Amazon 21 45.5%
Flipkart 19 27.3%
Jio 5 18.2%
Total 50 100%
INTERPRETATION:
Products, customer care and delivery service is one of important aspect of any ecommerce site.
So according to table 45.5%,27.3%say that Amazon and flipkart online services is more
satisfied In terms of products, customer care and delivery service.
Amazon is a clear winner here
22
Q3) In terms of pricing, with which online shopping site you are satisfied?
Amazon 37 50%
Flipkart 10 37.5%
Big basket 0 0%
3 12.5%
Jio
Total 50 100%
INTERPRETATION:
Price the most important aspect of purchasing” When an ecommerce site can offer that price
needed with reasonable price then everyone will go after that site only In terms of pricing 50%,
37.5% and 12.5% people are satisfied with Amazon flipkart and Jio.
Nobody prefers Big basket
23
Q4) Customer assistance after every purchase from flipkart is good ?
Agree 25 50%
Disagree 0 -
Neutral 38 37.5%
12 12.5%
Strongly agree
Strongly disagree 0 -
Total 50 100%
INTERPRETATION:
After purchase, company has to take responsibility of customer services. Flipkart has made it’s mark
in heart of customers .50%, 37.5%, 12.5% agree, strongly agree and neutral respectively that customer
assistance from Flipkart is good
24
Q5) Customer assistance after every purchase from Amazon is good?
Agree 38 87.5%
Disagree 0 -
Neutral 0 -
12 12.5%
Strongly agree
Strongly disagree 0 -
Total 50 100%
INTERPRETATION:
After purchase, company has to take responsibility of customer services. Amazon has made it’s
mark in heart of customers Amazon proved once again that it will be step ahead .87.5%, 12.5%
agree and strongly agree respectively that Customer assistance from Amazon is good
25
Q6) Around how much you spend on single-online purchase?
Rs 1000 -5000 0 -
12 12.5%
Above Rs 10000
Total 50 100%
INTERPRETATION:
Every customer has different purchasing power according to their earnings. So according to
the table. Around 50%, 12.5%, 37.5% people spend on single online purchase Below Rs
1000,Rs 1000-Rs 5000. Nobody spends above 100000
26
Q7).What type of products you purchase more often ?
Grocery 0 -
Clothing 25 50%
Electronics 18 25%
Total 50 100%
INTERPRETATION :
Every ecommerce website has a vast of range of products, everybody prefers different range of
products. So according to the table 25%, 50%, 25% purchase Books and stationary, clothing,
electronics products more often
27
Q8).In how many days the ordered products is delivered?
Amazon 37 75%
Flipkart 13 25%
Big basket 0 0%
O 0%
Jio
Total 50 100%
INTERPRETATION :
Delivery of the products is the last step and the crucial step it can make or mar any online
shopping site .So according to the table 25% and 37.5% people say that their delivery happens
Next day, within a week and within 15 days. Nobody gets delivered within a month
28
Q9).Have you faced any problem while using your preferred app. If yes then which one?
Delivery of wrong 0 0%
products
Total 50 100%
INTERPRETATION :
From product order to delivery of product it is companies responsibility to fulfil the
requirements of customers. Customers expect what they pay for if something happens they will
hesitate to purchase again. so according to the table 57.1%, 14.3%, 28.6% have faced problem
regarding Quality issues, delayed delivery, no proper refund are the problems faced
29
Q10).Does the delivery of the goods always come in time?
Yes 25 50%
No 10 20%
Sometimes 15 30%
Always O 0%
Total 50 100%
INTERPRETATION:
As said delivery is the last and the most crucial step. this step can make or mar any online
shopping site. 50%, 20% says Yes and No that delivery comes in time and 30% says only
sometime the delivery comes in time.
30
Q11).Are the goods delivered in a proper packaging?
Yes 37 87.5%
No 0 0%
Sometimes 13 12.5%
O 0%
Always
Total 50 100%
INTERPRETATION:
Proper packaging is done to ensure safety of products so that the products don’t get
damaged.87.5% say yes and 12.5% people say sometimes goods are delivered in proper
packaging
31
Q12).Is the delivery boy always co-operative and brings change?
Yes 37 75%
No 13 25%
Always 0 0%
Sometimes O 0%
Total 50 100%
INTERPRETATION:
.75% people say yes and 25% people say No that the delivery boy always co-operative And
brings change.
32
Q13).Does your preferred app has return and refund policy?
No 5 10%
Maybe 5 10%
Total 50 100%
INTERPRETATION ;
80% people say that they have refund policy On the other hand 10% people say no the
ecommerce site doesn’t have return and refund policy and 10% says that may be the app has
the return and refund policy
33
Q14). In how many days does the app refunds your money ?
Options Respondents %age
Within a month O 0%
Total 50 100%
INTERPRETATION :
Money should be refunded on time. So according to the table 37.5% and 25% people say that
within 15days Or till next month their money is refunded.
34
Q15).What aspect you don’t like about your app?
Options Respondents %age
Pricing 25 50%
Delivery 13 25%
Customer assistance O 0%
Total 50 100%
INTERPRETATION :
50%, and 25% people don’t like pricing, delivery and Quality of products respectively about
their app
35
Q16).How often do you shop online?
Options Respondents %age
Daily 10 12.5%
Once in a year O 0%
Total 50 100%
INTERPRETATION :
From the above table we can interpret that how often do customers shop online. It has become
an habit of online shopping instead of brick and motor shopping.75% and 12.5% people say
that they shop online once in a month, once in a week, and daily respectively. This opens more
ways for E commerce People do succeed in market
36
Q17) How often you use any other app other than Amazon Or flipkart ?
Options %age Respondents
Once in a week 12.5% 12
Total 50 100%
INTERPRETATION:
12.5%, 62.5%, 25% people say that they use other app Amazon or Flipkart once in a week,
once in a month, once in a year respectively
37
Q18). How do you choose online shopping site?
Options Respondents %age
Advertisement 37 37.5%
Referred by friends 0 0%
Online reviews O 0%
Total 50 100%
INTERPRETATION:
.37.5%37.5%, 25% people choose online shopping site by advertisement , Referred by family
and by online reviews respectively . Nobody refers by friends
38
Q19) Does promotional activities always impact your purchasing decisions?
Disagree 10 28.6%
O 0%
Strongly disagree
Total 50 100%
INTERPRETATION:
Promotional activities like advertisements on online websites, and campaigns plays a crucial
role. So according to the table 57.1%, 28.6%, 14.3% and 0% agree, disagree, strongly agree,
strongly disagree that promotional activities always impact your purchasing decisions
39
Q20.) On which occasions do people make purchase?
Festivals 10 12.5%
Offers 15 50%
Others 13 25%
Total 50 100%
INTERPRETATION:
E-commerce sites know when to and how to capture customers. The timing of offers in e-
commerce sites is just perfect. Even though people don’t need them they will purchase because
of tempting deals in a row 12.5% people make purchase in Weddings and Festivals. 25% and
50% people make purchase in others and offers
40
Q21) Which online shopping site will you suggest family and friends?
Flipkart 15 25%
Jio 0 -
19 37.5%
Myntra
Others 12 12.5%
Total 50 100%
INTERPRETATION:
Suggestion of any online shopping site with family and friends tells that the person is convinced
with that site. so according to the table 25% of people will suggest Amazon to family and
friends. On the other hand 25%, 25%, 12.5% will suggest Flipkart, Myntra and others
respectively to family and friends. So again Amazon is clearly head in compared to the other
online shopping site
41
Q22) How confident are you that your personal information is kept confidential when buying
products online?
Moderately 13 25%
confident
Total 50 100%
INTERPRETATION:
Security is major concern in ecommerce when data is stored there a chance of it getting leaked.
So according to table 37.5%, 25%, 25% and 12.5% are extremely confident, slightly confident,
moderately confident and not at all confident respectively that their personal information is kept
confidential when buying products online
42
CHAPTER 7
MACRO ANALYSIS
7.1Findings
1. 75% and 25% prefer Amazon and Flipkart. On the other hand 18.2 and 9.1 refers Big
basket and Jio.
2. 45.5%,27.3% say that Amazon and flipkart online services is more satisfied
In terms of products, customer care and delivery service
3. In terms of pricing 50%, 37.5% and 12.5% people are satisfied with Amazon flipkart
and Jio. Nobody prefers Big basket
4. 50%, 37.5%, 12.5% agree, strongly agree and neutral respectively that customer assistance
from Flipkart is good
5. 87.5%, 12.5% agree and strongly agree respectively that Customer assistance from
Amazon is good
6. Around 50%, 12.5%, 37.5% people spend on single online purchase Below Rs 1000,Rs
1000-Rs 5000
7. 25%, 50%, 25% purchase Books and stationary, clothing, electronics products more
often
8. 25% and 37.5% people say that their delivery happens Next day, within a week and
within 15 days. Nobody gets delivered within a month
9. 57.1%, 14.3%, 28.6% have faced problem regarding Quality issues, delayed delivery,
no proper refund are the problems faced
10. 50%, 20% says Yes and No that delivery comes in time and 30% says only sometime
the delivery comes in time.
11. 87.5% say yes and 12.5% people say sometimes goods are delivered in proper
packaging
12. 75% people say yes and 25% people say No that the delivery boy always co-operative
and brings change
13. 80% people say that they have refund policy .10% say No and Maybe
14. 37.5% and 25% people say that within 15days Or till next their money is refunded
15. 50%, and 25% people don’t like pricing, delivery and Quality of products
respectively about their app
43
16. 75% and 12.5% people say that they shop online once in a month, once in a week, and
daily respectively.
17. 12.5%, 62.5%, 25% people say that they use other app Amazon or Flipkart once in a
week, once in a month, once in a year respectively
18. 37.5%37.5%, 25% people choose online shopping site by advertisement , Referred by
family and by online reviews respectively . Nobody refers by friends
19. 57.1%, 28.6%, 14.3% and 0% agree, disagree, strongly agree, strongly disagree that
promotional activities always impact your purchasing decisions
20. 12.5% people make purchase in Weddings and Festivals. 25% and 50% people make
purchase in others and offers
21. 25% of people will suggest Amazon to family and friends. On the other hand 25%, 25%,
12.5% will suggest Flipkart, Myntra and others respectively to family and friends.
22. 37.5%, 25%, 25% and 12.5% are extremely confident, slightly confident, moderately
confident and not at all confident respectively that their personal information is kept
confidential when buying products online
7.2SUGGESTIONS
Flipkart is performing ok but not good enough. There are so many cases where people felt that
packing might have been better than this. Either it may be big or small / expensive or not
product has to be treated with care. Some of the products mostly apparel’s are turning
out with original cover of supplier , which shows negligence of them. In this issue Amazon
made a mark among us, because whatever the product is their packing will obviously safe and
secure. Amazon has become leading E-commerce company in India, few years before Amazon
India was behind in competition with Flipkart, but as we know Amazon India is a customer-
centric company. It always tries to provide better services to its customers. Flipkart started from
the very low budget but just because of its quick success, they got funding from big investors.
Flipkart successfully placed itself as India's largest online store with a huge range of products.
However, Flipkart still needs to work on its weaknesses and core competence. Flipkart should
pay more attention to customers satisfaction and on their queries because according to this
survey majority of people are not satisfied with their return policies and customer services.
Flipkart's products packages should be developed because they are receiving many customers
complaints about their packaging. Flipkart 59 should open warehouses in the urban and remote
area for fast delivery service. Flipkart should replace its marketing strategies with online
marketing techniques, these techniques help to build its online presence more strong through
search engine optimization techniques because most of the customers like to search from
Google for online shopping products.
Flipkart is performing ok but not good enough. There are so many cases where people felt that
packing might have been better than this. Either it may be big or small / expensive or not product
has to be treated with care. Some of the products mostly apparel's are turning out with original
cover of supplier, which shows negligence of them. In this issue Amazon made a mark among
us, because whatever the product is their packing will obviously safe and secure.
44
7.3CONCLUSION
• People also preferred and satisfied towards them. Although the customers are satisfied
with online shopping they also face some problems due to many technological and false
advertisement. This problem can be overcome by educating the customers.The research
concludes that even though amazon is giving branded and quality products but
customers are much attracted towards the best services flipkart.
• The e-commerce has been in the peak in India during past 2 years, the fast growing
technological changes has opened an option of online selling and purchase for a
common man in India. While comparison between both Flipkart and Amazon, it is
observed that Flipkart maintains more number of stock keeping units (SKU) as
compared to amazon considering the four popular electronic products.
• On the other hand the product sub categories offered by Flipkart is 422 with 86 main
categories on the website as compared to 186 sub categories and 16 main categories of
Amazon. It has been seen that there is a tie between both amazon India and Flipkart
when compared the work satisfaction level of employees.
• Both Flipkart and Amazon have established a strong base in India and a strong
competition can be seen between them in coming years.
• The study consisted with all the work flows of major e-commerce players in India,
Flipkart and Amazon. How they’re performing and how they are running perfectly in
the competitive world has been explained. The innovative thinking of them to reach
more and more consumers is appreciable. They increased their
networkmuchas possible with ultimate aim of reaching more and more customers
• . They made consumers work more easy and comfortable. In this competitive market
one has to be lead and rest will follow.
• Based upon consumer’s survey we got our clear winner and it is Amazon. Even though
it is an international company it understood Indians very well and made its roots stronger
in India. Flipkart is also giving very tough competition to Amazon even though it is new
45
company when compared to Amazon. May be it takes some time to overcome, but
definitely they are doing very well in Indian e-commerce market.
CHAPTER 7
ANNEXURE
BIBLIOGRAPHY
WEBSITES:
www.google.com
www.scribd.com
www.slideshare.com
www.academiaedu.com
www.flipkart.in
www.amazonindia.com
BOOKS:
Marketing management
Author:-Phillip Kotler
Marketing management
Author:-
C.B gupta
Publication:-
Sultan Chand & Sons – Tb
46
47
CHAPTER 9
APPENDIX
“A Study of consumer’s preference between Amazon OR Flipkart”
1.Profession
1. Student
2. Business
3. Teacher
4. Lawyer
5. Others
2.Age
1. 15-20
2. 21-31
3. 32-42
4. 43-63
3.Gender
1. Male
2. Female
3. Don’t want to say
48
8.Around how much you spend on single-online purchase?
1. Below Rs1000
2. Rs1000-Rs5000
3. Rs5000-Rs10000
4. Above Rs 10000
9.Customer assistance after every purchase from Amazon is good?
1. Agree
2. Disagree
3. Strongly agree
4. Strongly disagree
10.What type of products you purchase more often ?
1. Books and stationary
2. Grocery
3. Clothing
4. Electronics
11.In how many days the ordered products is delivered?
1. Next day
2. Within 4 days
3. Within a week
4. Within a Month
12.Have you faced any problem while using your preferred app. If yes then which one?
1. Quality issues
2. Delayed delivery
3. Delivery of wrong products
4. No proper refund policy
13.Does the delivery of the goods always come in time?
1. Yes
2. No
3. Sometimes
4. Always
14.Are the goods delivered in a proper packaging?
1. Yes
2. No
3. Sometimes
4. Always.
15.Is the delivery boy always co-operative and brings change?
1. Yes
2. No
3. Always
4. Sometimes
49
16.Does your preferred app has return and refund policy?
1. Yes
2. No
3. Maybe
17.In how many days does the app refunds your money ?
1. Next day
2. Within a week
3. Within 15 days
4. Within a month
18.What aspect you don’t like about your app?
1. Pricing
2. Delivery
3. Quality of products
4. Customer assistance
19.How often do you shop online?
1. Daily
2. Once in a week
3. Once in a month
4. Once in a year
20.How often you use any other app other than Amazon Or flipkart?
1. Once in a week
2. Once in a month
3. Once in a year
21.How do you choose online shopping site?
1. Advertisement
2. Referred by family
3. Referred by friends
4. Online reviews
22.Does promotional activities always impact your purchasing decisions?
1. Agree
2. Disagree
3. Strongly Agree
4. Strongly disagree.
23.Which online shopping site will you suggest family and friends?
1. Amazon
2. Flipkart
3. Jio
4. Myntra
5. Others
24.On which occasion do you make purchase?
50
1. Weddings
2. Festivals
3. Offers
4. Others
25.How confident are you that your personal information is kept confidential when buying
products online?
1. Strongly confident
2. Moderately confident
3. Slightly confident
4. Not at all confident
51