Case Study Description of Customer Analytics at Flipkart.Com
Flipkart, the poster child of Indian e-commerce, was an early entrant in the nascent Indian e-commerce market and quickly established itself as the leading company in this space. Flipkart has grown into an online retail giant, valued at over USD 15.2 billion as of 2015. Flipkart has been selling over 30 million products from more than 50,000 sellers in 70+ categories as well as has 30 exclusive brand associations with in-a-day guarantee in 50 cities and same-day guarantee in 13 cities. Flipkart was 33,000 people strong and had over 50 million registered users with over 10 million daily visits and 8 million shipments per month. Flipkart has been putting in much effort and emphasis on the use of Analytics in every aspect of decision making. Headed by Ravi Vijayaraghavan, the analytics team had over 100 data scientists in 2015. Customer churn is a major concern for Flipkart since it has direct impact on Customer Lifetime Value (CLV). CLV is an important measure to differentiate customers, which can further help the organization to manage them effectively. The main challenge in calculating the lifetime value of customers of e-commerce companies such as Flipkart is that the exact life of the customer is unknown owing to data truncation, that is, the actual point in time of customer churn, which may not be identified in e-commerce, since there would be no prior communication from the customer about the churn. Hence, traditional models of CLV calculation may not be appropriate for e-commerce companies such as Flipkart.
Swot Analysis of "Customer Analytics at Flipkart.Com" written by Naveen Bhansali, Jitendra Rudravaram, Shailaja Grover, Dinesh Kumar Unnikrishnan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Flipkart Clv facing as an external strategic factors. Some of the topics covered in Customer Analytics at Flipkart.Com case study are - Strategic Management Strategies, Customers, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Customer Analytics at Flipkart.Com casestudy better are - – increasing energy prices, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies,
technology disruption, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Customer Analytics at Flipkart.Com
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Customer Analytics at Flipkart.Com case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Flipkart Clv, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Flipkart Clv operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Customer Analytics at Flipkart.Com can be done for the following purposes –
1. Strategic planning using facts provided in Customer Analytics at Flipkart.Com case study
2. Improving business portfolio management of Flipkart Clv
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Flipkart Clv
Strengths Customer Analytics at Flipkart.Com | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Flipkart Clv in Customer Analytics at Flipkart.Com Harvard Business Review case study are -
High switching costs
– The high switching costs that Flipkart Clv has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Flipkart Clv is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Naveen Bhansali, Jitendra Rudravaram, Shailaja Grover, Dinesh Kumar Unnikrishnan can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management
– Flipkart Clv is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Flipkart Clv digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Flipkart Clv has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Successful track record of launching new products
– Flipkart Clv has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Flipkart Clv has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Effective Research and Development (R&D)
– Flipkart Clv has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Customer Analytics at Flipkart.Com - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Flipkart Clv is one of the leading recruiters in the industry. Managers in the Customer Analytics at Flipkart.Com are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Sales & Marketing industry
– Customer Analytics at Flipkart.Com firm has clearly differentiated products in the market place. This has enabled Flipkart Clv to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Flipkart Clv to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Flipkart Clv has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Customer Analytics at Flipkart.Com HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Flipkart Clv
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Flipkart Clv does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Flipkart Clv has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Customer Analytics at Flipkart.Com Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Learning organization
- Flipkart Clv is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Flipkart Clv is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Customer Analytics at Flipkart.Com Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Customer Analytics at Flipkart.Com | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Customer Analytics at Flipkart.Com are -
Products dominated business model
– Even though Flipkart Clv has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Customer Analytics at Flipkart.Com should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Naveen Bhansali, Jitendra Rudravaram, Shailaja Grover, Dinesh Kumar Unnikrishnan suggests that, Flipkart Clv is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Aligning sales with marketing
– It come across in the case study Customer Analytics at Flipkart.Com that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Customer Analytics at Flipkart.Com can leverage the sales team experience to cultivate customer relationships as Flipkart Clv is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Flipkart Clv has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Flipkart Clv even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Customer Analytics at Flipkart.Com, in the dynamic environment Flipkart Clv has struggled to respond to the nimble upstart competition. Flipkart Clv has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Flipkart Clv has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
No frontier risks strategy
– After analyzing the HBR case study Customer Analytics at Flipkart.Com, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Flipkart Clv supply chain. Even after few cautionary changes mentioned in the HBR case study - Customer Analytics at Flipkart.Com, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Flipkart Clv vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Customer Analytics at Flipkart.Com, it seems that the employees of Flipkart Clv don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Flipkart Clv is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Customer Analytics at Flipkart.Com can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Flipkart Clv has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Opportunities Customer Analytics at Flipkart.Com | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Customer Analytics at Flipkart.Com are -
Learning at scale
– Online learning technologies has now opened space for Flipkart Clv to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Flipkart Clv to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Flipkart Clv to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Flipkart Clv can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Customer Analytics at Flipkart.Com suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Building a culture of innovation
– managers at Flipkart Clv can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Flipkart Clv can use these opportunities to build new business models that can help the communities that Flipkart Clv operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Flipkart Clv in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Loyalty marketing
– Flipkart Clv has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Flipkart Clv can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Flipkart Clv can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Flipkart Clv is facing challenges because of the dominance of functional experts in the organization. Customer Analytics at Flipkart.Com case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Flipkart Clv to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Creating value in data economy
– The success of analytics program of Flipkart Clv has opened avenues for new revenue streams for the organization in the industry. This can help Flipkart Clv to build a more holistic ecosystem as suggested in the Customer Analytics at Flipkart.Com case study. Flipkart Clv can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Flipkart Clv can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Threats Customer Analytics at Flipkart.Com External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Customer Analytics at Flipkart.Com are -
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Flipkart Clv business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Flipkart Clv high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Flipkart Clv needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Flipkart Clv in the Sales & Marketing sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Customer Analytics at Flipkart.Com, Flipkart Clv may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Flipkart Clv will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Flipkart Clv can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Flipkart Clv has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Flipkart Clv needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing wage structure of Flipkart Clv
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Flipkart Clv.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Flipkart Clv with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Flipkart Clv.
Weighted SWOT Analysis of Customer Analytics at Flipkart.Com Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Customer Analytics at Flipkart.Com needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Customer Analytics at Flipkart.Com is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Customer Analytics at Flipkart.Com is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Customer Analytics at Flipkart.Com is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Flipkart Clv needs to make to build a sustainable competitive advantage.