As Flipkart gets ready to launch its Big Billion Day sale next week, Kalyan Krishnamurthy, chief executive officer of Flipkart Group, tells Peerzada Abrar and Bibhu Ranjan Mishra that the focus is no more about deep discounting or pricing but about solving several of their problems, including credit, local language choice, and installation service. He says the Bengaluru-based e-commerce major has not seen any big impact on consumer buying behaviour in the recent past despite a slowing economy. Edited excerpts:
The consumer sentiment in the country is seen as quite bearish while the overall economic growth is slowing down. Considering these, what are your expectations from the Big Billion Day sale?
We are a value platform. When the broader consumer spending is good, it is very good for us. Even when things slow down, people look to get more value at that time. The earlier perception was that the festival season and BBD is heavily about discounting and pricing. It’s not about that. It’s about offering all the affordability constructs, including unique selection, financing, a lot more engagement features on the app (like video streaming), feeds and Hindi, and also about involving a lot more ecosystem partners. For example, this year, players such as Burger King have partnered us and it has named a burger after Big Billion Day. So, the number of brands and merchants and ecosystem players, who are participating in the festival season this year, has gone up several times. Absolutely, people are betting big on the festival season (to purchase products). We can see that.
There are reports that people are thinking twice even before buying a Rs 5 biscuit packet. That means it’s more about consumer sentiment than the actual purchasing power of the people. Of course, these reports came before the announcement by the government last week to reduce corporate taxes. What is the sense you are getting?
We have not seen any big impact on anything. People still heavily buy very basic stuff on Flipkart. If you look at what our main customer categories are, they include fashion (the biggest one), general merchandise categories, baby products, toys, sporting goods, beauty care, home products, household products, and kitchenware. All of those products are still fairly basic things. And if you just look at the country’s e-commerce growth, more and more is coming from these categories.
We are hearing that offline retailers meeting the government to keep the discounts (offered by online platforms) under check. Do you think price won’t play a major role in attracting buyers to online platforms during the sale period this time?
In all the past 12 years, we have only been focused on our customers. We don’t get distracted by what (other) people in the ecosystem do sometimes. So every year, we come up with 30-40 new and innovative features, new products and initiatives for our customers. That’s what has kept us going. And that is what will keep us going. So we don’t get distracted by the noise.
What are the new features you are unveiling this time to provide shoppers a better (buying) experience?
For example, we launched (Flipkart app) in Hindi. It’s a very big product initiative for which we been working on for almost a year. Sometime ago, we launched a new platform called 2GUD (an e-commerce value platform for refurbished mobiles and electronics). We have launched Flipkart Video (streaming service) about three-four weeks back. Several such concepts we keep launching, and that’s what our customers like.
What are your expectations from this year’s BBD in terms of the volumes and value?
We are getting better. The big thing is what can we offer to our customers is unique, affordable selection not just from our sellers, merchants, artisans and brands, but also our own private brands. Financing option for the customers is big part of our strategy this year. Few years back, we had 10 million customers who were shortlisted to be given credit facilities in some way. This year, we are taking the number to 55 million. Earlier, it used to be just about delivering a product. Now, it’s heavily about services which go with that. For example, demo and installation services earlier used to be offered only for television sets. It is now being offered for all appliances, including furniture. All these just keep scaling because penetration of e-commerce is still low and there is so much room for us to grow.
How do you view the competition from Amazon and upcoming e-commerce business of Reliance Industries to tap the festive season?
I don’t want to call out any specific competition. We don’t track them. We don’t follow them too much. I think our single biggest focus is how we make sure that Flipkart offers democratic use cases to the customers. Flipkart does not just offer initiatives and products that are meant for the top 10 per cent (population) of the country.
What has changed for Flipkart after your partnership with Walmart?
The partnership with Walmart has been most progressive for us. We bring complementary skills. Flipkart has a very deep understanding of the Indian consumers. It’s a deep e-commerce company, Walmart has a company has very, very unique skills. It is one of the world’s largest supply, sourcing and brand-building companies. We have a lot to learn from Walmart, which we do.―Business Standard