In this industry, the scope for growth is immense, as is the risk of failure. Consulting firm Technopak Advisors estimates India's digital economy at $600 million currently, with the potential to balloon to $70 billion by 2020. K. Vaitheeswaran, e-commerce veteran, and Founder and CEO, Indiaplaza.com, one of India's earliest, compares the vertical to a hard-fought marathon. “It's not like a 100-metre dash. Globally, we operate on the lowest margins, but we're still seeing real growth.” There's still no formula for 100 per cent success. Flipkart is running the marathon with ample support from private equity players such as Accel Partners and Tiger Global, which have collectively invested $150 million in the entity so far. Although profits after tax remain negative, the company's valuation is soaring thanks to eager participation of these private equity players. The acquisition of Letsbuy.com signals FlipKart's ambitions to capture the domestic online market. A burgeoning consumer class, coupled with a rising web-literate population and zealous venture capital funding may just propel Flipkart to become India's answer to Amazon.com!
Uncovering India's online avatar is a fascinating process. Only those companies that can successfully engage customers through novel ideas, quality products and seamless services will flourish. May be it is sheer genius, or simple common sense the e-retail hero has been able to accomplish all this during its formative years. Summing up the Flipkart experience, Abhishek Asthana, a marketing student from Pune, has dedicated an ode to the portal. He tweaks the famous MasterCard campaign to sound something like “There are some things you can't buy online… For everything else, there's Flipkart!”
-Shyam Tenali