Professional Documents
Culture Documents
Sector Report
E-commerce
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E-Commerce: Use of internet to buy and sell products, idea, technology and services.
Value:
Increased efficiency
Cost-cutting
DOT-COM E-Commerce
New E-Commerce
Technology-driven
Business-driven
Traditional financing
Entrepreneurial
Traditional firms
Lack of standards
Stronger regulation/standards
Inexorability: inevitable and unstoppable nature in terms of the high rates of growth
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Value creation: Represents the potential or expected and actual monetary and nonmonetary results of utilizing an -e-commerce business model
The main monetary results of value creation include revenue enhancement through sales
growth and price differentiation, and cost reduction related to cost of goods sold, operating
costs, and asset intensity reduction.
E-commerce creates opportunities for asset intensity reduction, which means
(a) Reducing capital costs by effective, speedy disposition (selling) of unnecessary or old
equipment as well as excess or obsolete inventory
(b) More effectively using existing space by reducing inventory clutters with e--commerce.
The non-monetary value creation:
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Business model: method or tool by which a company would like to generate revenue/profit
and serve the customer needs.
E-commerce business model - five main components:
1. Value proposition unique values that the organization offers to its customers
through e--commerce. It is based on :
a. target market segment (customers)
b. core customer benefits that can be offered
2. Value-added e-commerce offerings or activities: set of e-commerce
products/services, processes and their relationships, which are required to fulfill the
value proposition. It includes:
a. product and service offerings
b. e-commerce processes
c. Relationships between products/services and processes
3. Supporting resources: resources that sustain the e-commerce models value
proposition and value-added offerings.
4. Revenue model: describes how a company will generate revenue/profit through ecommerce to build and sustain a competitive advantage. Cost model emphasizes
ways that a company uses to reduce cost
5. Value creation represents the potential/expected monetary and non-monetary
results of utilizing an e-commerce business model, i.e., an output of the e-commerce
model development
Types of e-commerce business models:
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Return on Investment (ROI) defines a business value of e-commerce model and is identified
as an expected savings divided by investments in e-commerce
Examples of market
Pricing Option
Precision
Determine the highest
price that has little or
no impact on purchase
Decision
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Source of Value
Test prices continuously
to better understand
market and the zone of
price indifference
segments
Commodity products:
Bikes, books, jewellery etc.
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Adaptability
Change prices frequently
in response to market
conditions, inventory
levels, etc.
Segmentation
Divide customers into
different classes and offer
a different price for each
Segment
Creating new channel of marketing and product sales with global outreach.
Can be used at any time of the day or week (24/7).
consolidates all product and sales information and search capabilities online,
allowing the customers to find quickly needed products or services
Provide paperless processes, which speeds up the order fulfilment process
and reduces transaction costs.
Provides an opportunity to coordinate order taking and order execution
Provides price differentiation online for various products and customer
segments for
o a new customer versus a repeat customer
o small business customer versus large volume customer
o international customer versus domestic customer
Electronic shopping cart checkout process using electronic shopping cart and
payment sys-tem
Order confirmation
Order tracking by connecting to the logistics carrier
Payment information to the internal back-end system like order management
and accounting
E-fulfilment: online process that provides collaboration between sellers and suppliers to
speed-up production and delivery of orders. The seller makes order information directly
available to suppliers.
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E-fulfilment process
Some demand-side e-commerce are Microsoft Office Live (former -Microsoft Commerce
Manager), eBay Stores, Yahoo Merchant Solutions, Storefront.net, and Oracle i-Store.
There are four main types of supply- side e-commerce (e-procurement) models:
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o Value creation (benefits): lowering the procure-to-order cycle time and cost,
reducing prices of materials, and lowering maverick purchase
o Drawbacks: The e-procurement software may be expensive for small and
mid-size companies and would require a lengthy implementation process.
Electronic exchange includes a variety of sellers that provide their supplier
catalogues to perspective customers and buyers use the online exchange for
sourcing to locate perspective suppliers
The main difference between demand side and supply side model is that the supply-side ecommerce models do not generate profit, but rather reduce costs associated with
purchasing/ procurement activities.
Founders
eCommerce Drivers
Started in
2010
Headquarters
Business Model
Revenue Model of
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eCommerce Industry
Comprise of
to consumers at prices lower than traditional brick-andmortar stores. Working with min. profit and gaining from
economic of scale is how it works. Selling Inhouse branded
services and products to customers.
No of Sellers - 50000
Unique Visitors per day - 15mn(Oct'14)
Registered Users - 25mn
Product Categories - 24
Products Listed(Catalog) - 5mn
Fulfillment Centres - 40
Total Sales FY 12-13 - $330mn
Financial Scenario
Top Investors
VAS
Inhouse
Products/Service
Payment Options
Sales Promotion
Techniques
FCB Ulka
Digital Marketing
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Startegy Focus
Website Rank
SEO
Web Search - 36
Image Search -34
News Search - 15
YouTube Search 0
Google Adwords
Re marketing
Successgul Brand
Campaigns
TV Commercial Strategy
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Facebook Strategy
Twitter Strategy
Linkedin Strategy
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Youtube Strategy
Pinterest Strategy
1) Followers - 750
2) Teme based 55 boards i.e. Nail art, DIY, Excl offers,
perfumes, watchubuy, worth a read etc.
3) Each Pin is redirected to its official webpage
4) Each board and image is very appealing
Google+ Strategy
1) Followers - 6,37,000
2) 1 or 2 category based Posts everyday.
3) Less focus on Deals/offer specific posts
4) Category/Product feature based posts with attractive image
ads
4) Follower engagement is area of improvement
Content Marketing
Strategy
Integrated Channel
Across social media
platforms
Mobile Marketing
Strategy
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Affiliate Marketing
Strategy
1) Earn upto 20% for each purchase via content site and upto
12% for each purchase via shopping site
2) Payment via EFT options
3) Referral Payout for each month/category is communicated
4) Payments made 60days after the month of sale
5) various reports are released to help Affiliates
6) very transparent and accurate program
Other Marketing
Strategies
Snapdeals next big thing is to hit the outdoors. This year the
team came up with a massive Snapdeal banner which stands
imprinted on a building in Gurgaons-DLF Cyber City.
Acquisitions:
June 2011
Grabbon.com.
April 2012
esportsbuy.com
May 2013
April 2014
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Doozton.com
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Dec 2014
Wishpicker.com
Jan 2015
Smartprix.com
Feb 2015
Exclusively.in
March 2015
20% stake in
Gojavas.com
March 2015
Unicommerce.com
March 2015
RupeePower.com
April 2015
mobile-payments company
FreeCharge.com
STP
Segmentation
Demographic segmentation
Teens and young adults are grouped together into one segment. People in the
age group of 16 to 30 years typically forms this segment.
These people are either college students or people who have recently started
earning.
People having moderate to high family income are segmented together.
Geographic segmentation
Behavioural segmentation
Targeting
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Snapdeal focuses on mass online marketing but uses customer history to give a more
personalized experience
Positioning
Snapdeal is currently positioned as best advertising
and discount platform in the online Indian market. For
product and service providers it acts as a great
advertising platform and for consumers it acts as a
low price online market.
Snapdeal is trying to reposition itself with greater
focus on quality. All the products showcased on the
website are genuine. Each and every product is
quality checked before being delivered to the
customers.
SWOT Analysis
1. Constant innovations and good branding
2. Vast network of retailers across nation
3. Excellent service through convenient processes
4. Wide range of deals and transactions to choose from
5. Lots of awards and recognition as best startups, ecommerce etc
Strength
Opportunity
Threats
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Founders
eCommerce Drivers
Started in
2007
Headquarters
Bangalore, India
Business Model
Revenue Model of
eCommerce Industry
Comprise of
No of Sellers - 3000
Unique Visitors per month - 28mn(Oct'14)
Registered Users - 22mn
Product Categories - 24
Products Listed(Catalog) - 15mn
Total Sales FY12-13 - $1bn
Financial Scenario
Top Investors
VAS
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Inhouse
Products/Service
Payment Options
Sales Promotion
Techniques
Digital Marketing
Startegy Focus
Website Rank
SEO
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Google Adwords
Re marketing
Successgul Brand
Campaigns
TV Commercial Strategy
Facebook Strategy
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acquisition
3) Likes - 3.3mn
4) Seasons to Festives to Birthday based cover photos
5) Avg. 3-4 posts per day basis
5) Updates on new products and customer quiries
6) response on customer complaint is average and
inconsistent
7) Running contests/gamification
8) Exclusive customer tab for support
9) Avg Response per Post - 40-50
10) Focus is on customer acquisition and engagement
11) Customer queries response is area of impro.
12) Social Listening/Emotional Connect - Average
Twitter Strategy
Linkedin Strategy
Youtube Strategy
Pinterest Strategy
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Google+ Strategy
Content Marketing
Strategy
Integrated Channel
Across social media
platforms
Mobile Marketing
Strategy
Affiliate Marketing
Stratetgy
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Acquisitions
2010:
WeRead
2011:
Mime360
2011:
Chakpak.com
2012:
Letsbuy.com
2014:
2015:
AdiQuity
2015:
Appiterate.com
STP
MARKET SEGMENTATION and TARGET
GEOGRAPHIC SEGMENTATION
BEHAVIOURAL SEGMENTATION
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They target online shoppers and people who dont online shop (thus TVC to
encourage them)
MARKET POSITIONING
Points of parity:
Points of Difference:
Founders
Jeff Bezos
eCommerce Drivers
Started in
2013
Headquarters
Seattle, Washington US
Business Model
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Revenue Model of
eCommerce Industry
Comprise of
Financial Scenario
Top Investors
VAS
Inhouse
Products/Service
Payment Options
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Digital Marketing
Startegy Focus
Website Rank
SEO
Web Search - 32
Image Search - 45
News Search -17
YouTube Search 35
Google Adwords
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Re marketing
Successgul Brand
Campaigns
TV Commercial Strategy
Facebook Strategy
Twitter Strategy
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LinkedIn Strategy
YouTube Strategy
Pinterest Strategy
1) Followers - 8.5K
2) Theme based 23 boards i.e. lifestyle, tech, gadget, party
3) Each Pin is redirected to its official webpage
4) Each board and image is very appealing
Google+ Strategy
1) Followers - 5.9K
2) 1 Posts on fortnightly basis
3) Deals/offer specific posts
4) The whole strategy is lacking
5) Interaction and participation level is very poor
1) PR Release page exists
2) PR release about company info, events, exclusive
product/service updates
Content Marketing
Strategy
Integrated Channel
Across social media
platforms
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Mobile Marketing
Strategy
Affiliate Marketing
Straetgy
E-mail Marketing
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STP
Segmentation
The main strategies that a firm can use to segment there market include;
Targeting
Targeting strategies are classified into two main categories:
Positioning
There are two main strategies for positioning a company within the market.
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Founders
eCommerce Drivers
Started in
July 2011
Headquarters
Gurgaon, India
Business Model
Revenue Model of
eCommerce Industry
Comprise of
The brand has already carved a strong niche for itself in the
Indian e-tailing space with over 65,000 merchants powering
an extensive selection of 5.3 million products across 3000
listing categories.
Top Investors
STP
MARKET SEGMENTATION and TARGET
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Geographic Segmentation
Caters to tier 2 and tier 3 cities demographic segmentation
75% of online users between the age group of 15-34 years
Behavioural Segmentation
Web friendly people
POSITIONING Great shopping experience for the masses and ample choice to customers in
its products varieties at wholesale rates.
SWOT Analysis:
1. It has 7,500 plus national and international brands.
2.A large sellers base comprising of 75,000 plus sellers.
3. It lists 9,000,000 products across 4000 plus categories.
4. Products are shipped to 12,000 plus cities.
5. Great offering of EMI plans for price sensitive customers
6. Loyalty system in the form of Clues Bucks.
Strength
Weakness
Opportunity
Threats
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Mobile Wallets
The prepaid payment instruments that can be issued in the country are classified under the four
categories viz. (i) Closed system payment instruments (ii) Semi-Closed system payment instruments
(iii) Semi-Open system payment instruments and (iv) Open system payment instruments.
Closed System Payment Instruments: These are payment instruments generally issued by business
establishments for use at their respective establishment only. These instruments do not permit cash
withdrawal or redemption. Example - Freecharge credit, Ola money etc.
Semi-Closed System Payment Instruments: These are payment instruments which are redeemable
at a group of clearly identified merchant locations/ establishments which contract specifically with
the issuer to accept the payment instrument. These instruments do not permit cash withdrawal or
redemption by the holder. Example - Paytm
Semi-open System Payment Instruments: These are payment instruments which can be used for
purchase of goods and services at any card accepting merchant locations (Point of sale terminals).
These instruments do not permit cash withdrawal or redemption by the holder. Example - several
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private label cards issued by merchants.
Open System Payment Instruments: These are payment instruments which can be used for
purchase of goods and services and also permit cash withdrawal at ATMs. Example - Almost every
Visa, MasterCard or Rupay card issued in India.
Mobile Prepaid Instruments: The prepaid talk time issued by mobile service providers. This value of
talk time can also be used for purchase of 'value added service' from the mobile service provider or
third-party service providers.
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Some differentiating factors for Paytm :
Paytm as Cash/Currency
Paytm started as a payment gateway facilitating mobile recharge has risen to become a zero
commission marketplace for multitude of products. It has been able to create a unique concept of
CASHBACK. In this concept, the customer pays the entire amount of the product and then the
cashback amount is credited to the account of the customer within 24 hrs. or on the date of
shipment of the product. The striking feature is that the cashback amount can be used across the
platform which uses Paytm as one of the payment options. Paytm has been very successful in
creating an ecosystem where its users can avail the use of cashback money. The cashback money
can be used to
1. Book bus ticket
2. Book flight tickets on via.com
3. Book train tickets on irctc.com
4. Book movie tickets on bookmyshow.com
5. Book cabs on TaxiforSure and Uber
6. Buy products on paytm.com and Paytm app
7. Order food on app like Tinyowl
8. Book Hotels on sites like makemytrip.com
Small List of platforms where you can use the Paytm wallet
Dominos Pizza
Jabong
FabFurnish
Zovi
Bharat Matrimony
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Foodpanda
TastyKhana
JustEat
Haldirams
Archies
IndiaTime Shopping
Infibeam
It shall be able to close the loop when it facilitates the payment at kirana shops and payment of
taxes to businesses and individuals. This is almost like creating a parallel currency.
Promotional Campaigns:
In order to get more customers and encourage more transactions Paytm regularly comes up with
discounts, cashbacks and combinational offers.
Recent cashback offer was offered on Rakhi was This Rakhi Gift Your Sister Some Paytm Shagun And
This Rakhi Send Her Rs. 2000 &Get Rs. 100 Cashback.
Brand Campaigns:
Paytm had launched its brand campaign during the IPL, which aimed to reinforce its position as the
leader in the mobile commerce space. Paytm was an associate sponsor on Sony and also the official
partner of Mumbai Indians and had spent Rs 50 crore for this marketing campaign.
The campaign is led by TV and the thematic film tries to establish Paytm as the simpler, more
convenient solution to a significant number of slice of life, everyday situations.
The ad begins with a rakhi scene, in which a brother surprises his sister by transferring money in her
Paytm wallet after the ritual. Next comes the scene where a husband is in the middle of preparing a
dish for his wife by taking tips from a TV show, when suddenly the show stops as the DTH recharge
gets over. This is when his wife activates the recharge through Paytm and the cooking continues. A
homesick son, going to the war front, brings a smile on his mothers face by sending her a mobile
recharge through Paytm, making sure distance doesnt separate them. A passenger transfers money
into the Paytm wallet of his taxi driver as he doesnt have change, showing the convenience of
money transfer in a last minute situation. Lastly, the TVC ends with a lady bargaining while shopping
online and making the purchase at the price of her choice, which again is another crucial feature that
Paytm offers
The TVC aimed at blending Paytms transactional aspect with the real human emotions attached to
them and position Paytm as a new way of life.
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Oyo Rooms is Indias largest branded network of hotels founded by Ritesh Agarwal. OYO Rooms
currently operates in 113 Indian cities including Delhi, Gurgaon, Mumbai, Bangalore, Hyderabad,
Goa, Chennai, Kolkata and others. OYO is present in major metros, regional hubs, leisure
destinations and pilgrimage towns. The company is backed investors like the Softbank Group,
Greenoaks Capital, Sequoia Capital and Lightspeed India.
Business Model:
OYO Rooms is an online aggregator of budget hotels. OYO Rooms partners with hotels with the aim
of standardization on various measures in each room including free Wi-Fi and breakfast, flat screen
TVs, spotless white bed linen of a certain thread count, branded toiletries, 6-inch shower heads, a
beverage tray and so on. The standards are audited every few days so that the customers are
assured a quality experience.
OYOs budget stays range from 999 ($16) to 4,000 rupees ($66). OYO provides property owners with
support such as quality standardized supplies and service training. OYO boasts of a 24x7 in-house
customer service centre.
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To make hotel booking convenient and seamless, Oyo Rooms has developed an app ecosystem
which includes all stakeholders, including customers, in-house staff and hotel owners.
OYO's traction and market coverage has swiftly increased thanks also because of being listed with
travel aggregators like Make MyTrip, Clear trip and hotels.com. The Hospitality industry segment
targeting small business travellers and budget tourists is eminently swift-cash, and that works in the
favour
of
OYO,
because
revenues
get
realized
quicker
too.
OYO doesn't own any of these properties, and instead, invests in marketing and management quality
improvement for the hotels under its fold. It's a win-win for OYO and the hotels, many of whom just
don't have the network, knowledge or the budget for smart marketing, and they run empty. OYO
helps them improve their yields. Oyo currently has 2500+ hotels offering standardized stay
experiences at an unmatched price.
It's not easy in India, where there are no standards being followed by class B and C hotels; where the
owners are not entirely professionally trained or oriented for the hospitality space, and where, it's
not easy to get money to improve your hotel. To OYO's credit, it seems to have created an
understandable
and
compelling
value
proposition
for
partner
hotels.
Currently, the company at is under the invest-and expand mode, and has attracted two
rounds of PE funding already.
There is a heady mix of competition in this segment with Zo rooms and Awesome Stays also
looking to scale up their business.
Madison Media Plus, a part of Madison Media Group, won media AOR for Oyo Rooms. The
account was won in a multi-agency pitch.
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Brand Campaigns:
Oyo Rooms majorly focuses on Digital Media to popularise its brand and connect to the customers. It
has its own blog where things like the top 5 food to eat in Delhi or the Old Delhi photography route
is covered to appeal for its customers. Major branding is done through hashtag campaigns to gain
popularity. Some of its campaigns are given below.
Fathers Day Campaign
OYO Rooms launched a campaign around Fathers Day to celebrate this relationship.
The film shows how a son (who is also a father now) all of a sudden sees his late father. To his
surprise, the father points him for not getting a gift on Fathers Day. Apologetic son gets emotional
and confesses on how much he always loved him. To the son's surprise, it turns out that it was his
own son disguised as his father seeking an occasion to express his love.
Independence Day Campaign
OYO Rooms, a branded network of hotels, has rolled out a digital film to support its social media
campaign #Azaadi4me in the lead up to the Independence Day on 15 August.
The film titled Jai Hind features Bollywood actors Manoj Bajpai and Raveena Tandon and has been
conceptualised by Boring Brands. The film, an official statement informed, is a tribute to Indias
Freedom Fighters.
Set in 2015 Mumbai, the film depicts an evening out of a regular couple. The couple, on a motorbike,
discuss what to have for dinner in celebration of the ladys birthday. They meet with an accident as a
car slams against them. The car comes to a halt as the lead couple lie on the road. Its driver, a
foreigner, opens the door only to curse Bloody Indian, before driving off. What transpires from
there on is an extreme take on what might have happened to the couple if India had not attained
independence. But the film pulls back to the present day, independent India, and plays out the
happy scenario before saluting freedom fighters who enabled Indias freedom.
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