Sales and distribution management

1. E-Commerce & its Impact in India
The fascinating dawn of the internet era brought new possibilities that made e-commerce to
emerge as an amalgamation of the technology and the marketing acumen. India has also
joined the bandwagon and the numbers are themselves talking it all . The recent statistics
reveal that India has 70 million active Internet users and the count is rising exponentially by
every minute. India has an internet user base of about 243.2 million as of January 2014.
Despite being third largest user base in world, the penetration of Internet is low compared to
markets like the United States, United Kingdom or France but is growing much faster, adding
around 6 million new entrants every month
The industry consensus is that growth is at an inflection point. In India, cash on delivery is
the most preferred payment method, accumulating 75% of the e-retail activities. One report,
shared by ASSOCHAM, estimated that the online retail industry has touched Rs 7,000 crore
by 2015, with an annual growth rate of 35 %. Adding to this report, IAMI has provided the
data to indicate a glance at India's e-commerce sector where transactions rose 50 % annually.
E-tailing or online retailing , which generally accounts for approximately 6 % of the Rs
46,000 crore industry, has been taking the forefront of this rapid growth of the sector.
Demand for international consumer products (including long-tail items) is growing much
faster than in-country supply from authorised distributors and e-commerce offerings. As of
2015, seven Indian e-commerce companies have managed to achieve billion-dollar valuation.
Namely, Flipkart, Snapdeal, InMobi, PosterGuy, Quikr, OlaCabs, and Paytm (wing of,
One97)
With enough amount of the literature, thousands of the articles and the multiple studies
conducted around the growth of e-commerce, it undoubtedly is the new and effective mantra
in the world of marketing.However there exists plenty of competition in the e-commerce
market. With countless similar e-commerce players, the winners are those who are able to
provide a delightful experience and have a robust business model that can quickly scale. E-
commerce is just 0.25 % of the India’s total retail activity. But there is a big difference as
“the US has an old and rich legacy of organised retail and ecommerce came in later. In India,
both are growing almos together. So Indian ecommerce will grow much faster,” says Khanna.
Market size and growth
India's e-commerce market was worth about $3.8 billion in 2009, it went up to $12.6 billion
in 2013. In 2013, the e-retail segment was worth US$2.3 billion. About 70% of India's e-
commerce market is travel related. According to Google India, there were 35 million online
shoppers in India in 2014 Q1 and is expected to cross 100 million mark by end of year 2016.
CAGR vis-à-vis a global growth rate of 8–10%. Electronics and Apparel are the biggest
categories in terms of sales.
According to a study conducted by the Internet and Mobile Association of India, the e-
commerce sector is estimated to reach Rs. 211,005 crore by December 2016. The study also
stated that online travel accounts for 61% of the ecommerce market. By 2020, India is
expected to generate $100 billion online retail revenue out of which $35 billion will be
through fashion e-commerce. Online apparel sales are set to grow four times in coming
years.India's retail market is estimated at $470 billion in 2011 and is expected to grow to
$675 Bn by 2016 and $850 billion by 2020, – estimated CAGR of 10%.
According to Forrester, the e-commerce market in India is set to grow the fastest within the

2. Asia-Pacific Region at a CAGR of over 57% between 2012–16. As per "India Goes Digital",
a report by Avendus Capital, the Indian e-commerce market is estimated at Rs 28,500 Crore
($6.3 billion) for the year 2011. Online travel constitutes a sizable portion (87%) of this
market today. Online travel market in India had a growth rate of 22% over the next 4 years
and reach Rs 54,800 crore ($12.2billion) in size by 2015. Indian e-tailing industry is
estimated at Rs 3,600 crore (US$800 million) in 2011 and estimated to grow to Rs 53,000
crore ($11.8 billion) in 2015. Overall e-commerce market had reached Rs 1,07,800 crores
(US$24 billion) by the year 2015 with both online travel and e-tailing contributing equally.
Another big segment in e-commerce is mobile/DTH recharge with nearly 1 million
transactions daily by operator websites.
A new sector in e-commerce is online medicine, selling complementary and alternative
medicine or prescription medicine online. There are no dedicated online pharmacy laws in
India and it is permissible to sell prescription medicine online with a legitimate license.
Online sales of luxury products like jewellery also increased over the years. Most of the retail
brands have also started entering into the market and they expect at least 20% sales through
online in next 2–3 years.
Business Models
Based on the type of relationship between different sides of a transaction, a transaction can be
categorized in different types.
There exist different transaction schemes that are forked from different types of e‐commerce.
Some of the more popular ones have been given below;
• Business‐to‐Consumer (B2C) ‐ Business‐to‐consumer describes activities of businesses
serving end consumers with products
and/or services.
E.g., Makemytrip, Paytm (One97)
• Consumer‐to‐Consumer (C2C) ‐ Consumer‐to‐consumer electronic commerce involves
electronically facilitated transactions between consumers usually through some third
party.
E.g., eBay
• Business‐to‐Business (B2B) ‐ Business‐to‐business (B2B) describes commerce
transactions between businesses, such as between a manufacturer and a wholesaler,
or between a wholesaler and a retailer.
E.g., Snapdeal
• Consumer‐to‐Business (C2B) ‐ Consumer‐to‐business (C2B) is an electronic commerce
business model in which consumers (individuals) offer products and services to
companies and the companies pay them.
E.g., Roundone (Referral)
One should also note that there are several other categories, such as B2E, B2G, G2B, G2C
(relating to business & its employees,Government & its citizens). But they do not form a part
of the broad classification of the various modes of e‐Commerce transactions.

3. Revenue Model
The revenue model is a key component of the business model. It primarily identifies what
product or service will be created inorder to generate revenues and the ways in which the
product or service will be sold. Since there are possibilities of multiple variations, many
companies do not use one single revenue model. Some of the commonly used models have
been enumerated below;
• Advertising revenue model -
The advertising revenue model is based on contacts (CPC or CPX) making it one of the
indirect sources of revenue.
E.g., Google, Facebook
• Subscription revenue model -
Users are charged a periodic (daily, monthly or annual) fee to subscribe to a service.~
E.g., Flipkart Media, Nasscom
• Transaction fee revenue model -
A company receives commissions based on volume for enabling or executing transactions.
The revenue is generated through
transaction fees by the customer paying a fee for a transaction to the operator of a platform.
E.g., Snapdeal, eBay
• Sales revenue model -
Wholesalers and retailers of goods and services sell their products online. In terms of online
sales there are different models
such as market places as common entry points for various products from multiple vendors.
E.g., Flipkart, Urbanladder
There are more variations ‐ for example sponsoring, content‐syndication and data‐mining. E‐
Commerce will progress into creating new kinds of revenue models ‐ certainly, new and
interesting variations can be expected in the future. Especially big internet companies such as
Amazon, eBay, Google and Facebook show their great capabilities to develop new revenue
models by combining and constantly improving them.
About Snapdeal
The company founded by two school friends who had a strong urge of doing something on
their own. They started exploring with selling the discount coupons and then by regularly
changing their business model they landed to building a market place- based e-commerce
company called Snapdeal in 2010. Kunal Bahl and Rohit Bansal wanted to start their own
business, they chose an offline couponing business and named it Money Saver. 15000
coupons were sold in three months and it was time to take the business to the next level.
Inspired by the success of Alibaba.com, founders wanted to create something on similar lines.
The deals business was shut down and an online marketplace was opened instead.
It is never easy to start a business. One need to work on your ideas, find capital and investors
and then need to work hard to get results.. Snapdeal set a niche for itself in the sphere of e-
commerce in India. Initially started as an offline business, Sneapdeal went online in 2010. It
was a bumpy ride in the first few months. Mistakes were made, but lessons were learnt. It is
this kind of hard work and diligent attempt to offer the best to the customers that gave
Snapdeal its initial success.

4. Snapdeal is one of the fastest growing e-commerce companies in India today with the largest
online market place. In just three and half years, the company went from scrapping their
group coupon business and starting an online marketplace to become a billion dollar
company. Its year on year growth is almost 600%. Snapdeal had a huge market share in the
deals business at that time and starting something new was very risky and the move surprised
the investors too. At that point of time, eBay was the only marketplace in India. Barring the
global eBay, there were no online marketplaces in India then. (Companies such as Flipkart
were purely inventory-led - they bought goods to sell on their sites; they did not allow others
to set up shop3. Snapdeal is valued at a billion dollars today is a testimony to the vision of its
founders, for the long term.
Currently, more than 50,000 sellers sell around 5 million products on Snapdeal. The
company‘s phenomenal growth in a short span has been a remarkable journey. The company
began to concentrate on building scale and improving speed. Their values – Innovation,
Change, Openness, Honesty and Ownership drive them to press for greater success. The
company‘s growth had been phenomenal but it is their continued effort to bring the best to
the market and their zeal to succeed as the best B2C (Business to customer) marketplace is
what sets them apart.
Speed and scale are both very important for any internet based company. Based on approach:
BHAG, meaning 'run' in Hindi and standing for 'big, hairy, audacious goal': team sets
seemingly unattainable goals and then strive for it, giving the effort everything. "The goal
should be so unachievable that if you ask people in the office for feedback, they should either
get very nervous or laugh out loud at the ridiculousness of the idea," says Bahl.‖ Says one of
the founder.
Every quarter there is a new goal to be reached. Monthly revenue was then between Rs 5
crore and Rs 7 crore - by the end of the quarter it had to be raised to Rs 30 crore. Eyes in the
office popped out at the figure - but it was achieved. Not all missions involved raking in more
revenue. There is NPS, standing for 'net promoter score' and involved assessing the quality of
transactions. Once a product is bought and delivered, the buyer is routinely asked to rate the
entire experience on a scale of zero to 10. A buyer rating of six or below is a 'detractor', seven
to eight is a 'moderator' and nine to 10, a 'promoter'. The NPS is calculated based on the
responses - and is usually between 35 and 50 for most e-commerce sites. But company
achieved it at 65.
Core Values
Company takes pride in their culture. Some core values that have been inherent and are an
integral part of their success story. These values are a pure reflection of what is important to them
as a Team and Business. The 5 core values are: Snap Deal

5. Innovation :Creativity is at the core of our business values. The team is given the freedom to
take informed, responsible risks.
Change: We are ever evolving and believe in driving change, embracing every opportunity
with open arms.
Openness: We encourage every team member to share ideas and feedback openly thereby
building strong relationships built on Trust and Faith.
Ownership: Every member owns the task they take up. We foster collaboration while
building individual accountability.
Honesty: We believe in doing the right thing under all circumstances.
Expanding Product Base
Snapdeal is now the second-largest e-tailing company after Flipkart . It has about 50,000
merchants selling five million products on its site, adding a product every 20 seconds.
Comparatively, Flipkart remains primarily inventory led, with only 2,000 sellers. The only
company that comes close is ShopClues, an online marketplace which targets Tier-II and
Tier-III towns. Radhika Agarwal, Co-founder, ShopClues, says it also has 50,000 sellers.
eBay, the world's largest open online marketplace, in comparison, has 45,000 sellers in India.
Snapdeal focused on provision of availability of products at the best prices based on Market –
Place led model instead of Inventory –led model.
Snapdeal.com follows an umbrella e-commerce strategy, and has added lifestyle products and
consumer electronics to its daily deals section. Deals appealing to masses are offered. The
model will continue with daily deals but services categories like restaurants, spas, gyms,
movies, etc. joining the race; it will be inevitable for the company that the model of daily
deals on services and products merge because of the same customer segment. To tap a large
user base, this strategy will prove fruitful to the company in order to achieve scale.
Commitment: Shipment with 24 hours
Promising delivery in two days and others followed suit. The next target was 'same-day
delivery'. Snapdeal set itself Mission 24, which was to ship 75 per cent of products within 24
hours of the order being placed. By the end of the quarter, 80 per cent of products were being
shipped in a dayl
.
No Plants & Machinery
Kunal lists culture and objectivity. Describing Snapdeal‘s culture as ―smart, generous and
humble,‖ he feels culture determines the speed of growth of a non-traditional business like
Snapdeal‘s. The success and failure is completely dependent on the quality, focus and the
motivation of its people; speed or sluggishness — everything is People. Following a unique
organizational culture at Snap Deal proves helpful when something is not done before. Great
ability to listen, learn and absorb like sponges with a quiet confidence in ‗them‘, they just
keep executing, brings innovative thinking and open mind to everything. Thinking to make
them learn fast and better , taking good idea from one employee manifests in company
policy. Snapdeal creates its differentiation strategy.
Download the MOBILE APP
Company targets to receive 75 to 85 per cent targets through mobile users. Separate team was
constituted year and half back to compete with PC team. Mobile team focus to make mobile
site lightweight where wants can be checked in four clicks. Importance is given to high
performance mobile assets rather than feature-rich ones which could slow them down.
"Snapdeal raised $133.7 million in one round of funding in February 2014, followed by
another of $105 million in April to build better infrastructure for mobiles.

6. Customer come back to you
Offering Good service or something unique to offer, very broad and very deep, provide a
service which is convenient for people , up scaling the service in case the customers have an
issue brings back the customer . Indian e-commerce companies are changing their customer-
acquisition strategy and are enticing people with offers to install their apps on mobile phones.
They expect the move to create more loyal customers than those who land on the portal
through online searches.
Snapdeal’s Penetration Into Indian E – Retailing
Industry
It is never easy to start a business. You need to work on your ideas, find capital and investors
and then you need to work hard to get results. Ask those who have succeeded, they tell you it
is the best feeling ever when an idea takes off to places. Snapdeal set a niche for itself in the
sphere of e-commerce in India. In 2010, when Kunal Bahl and Rohit Bansal wanted to start
their own business, they chose an offline couponing business and named it Money Saver.
15000 coupons were sold in three months and it was time to take the business to the
next level.
It was after they met investor Vani Kola that the venture really took off. The first meeting did
not go well but after another round of discussion, Vani Kola’s venture capital firm decided to
invest in Snapdeal. Initially started as an offline business, Sneapdeal went online in 2010. It
was a bumpy ride in the first few months. Mistakes were made, but lessons were learnt. It is
this kind of hard work and diligent attempt to offer the best to the customers that gave
Snapdeal its initial success. However, the biggest decision of the founders came in November
2011. Inspired by the success of Alibaba.com, Rohit and Kunal wanted to create something
on similar lines. The deals business was shut down and an online marketplace was opened
instead.It was a make or break decision. Snapdeal had a huge market share in the deals
business at that time and starting something new was very risky and the move surprised the
investors too. At that point of time, eBay was the only marketplace in India. It was a decision
that was not for the short term. When Rohit Bahl managed to gain the nod the board, the
present form of Snapdeal took shape. The very fact that Snapdeal is valued at a billion dollars
today is a testimony to the vision of its founders. Currently, more than 50,000 sellers sell
around 5 million products on Snapdeal. The company’s phenomenal growth in a short span
has been a remarkable journey. The company began to concentrate on building scale and
improving speed. When eBay invested in Snapdeal, they brought immense experience to the
table.
Snapdeal is one of the fastest growing e-commerce companies in India today with the largest
online market place. In just two years, the company went from scrapping their group coupon
business and starting an online marketplace to become a billion dollar company. Its year on
year growth is almost 600%.The average age of the workforce at Snapdeal is 25. Their values
– Innovation, Change, Openness, Honesty and Ownership drive them to press for greater
success. The company’s growth had been phenomenal but it is their continued effort to bring
the best to the market and their zeal to succeed as the best B2C (Business to customer)
marketplace is what sets them apart. Great ideas might be important for a business, but it is
the confident implementation of those ideas and the right effort which are more important. It
is action and not mere thought that gives results.

7. Funding
Snapdeal has received 7 rounds of funding:
Round 1: In January 2011, Snapdeal received a funding of $12 million from Nexus Venture
Partners and Indo-US Venture Partners.
Round 2: In July 2011, the company raised a further $45 million from Bessemer Venture
Partners, along with existing investors Nexus Venture Partners and Indo-US Venture
Partners.
Round 3: Snapdeal then raised a 3rd round of funding worth $50 million from eBay and
received participation from existing investors – i.e. Bessemer Venture Partners, Nexus
Venture and IndoUS Venture Partners.
Round 4: Snapdeal received its 4th round of funding of $133 million on Feb-2014. The 4th
round of funding was led by eBay with all the current institutional investors, including
Kalaari Capital, Nexus Venture Partners, Bessemer Venture Partners, Intel Capital and Saama
Capital all participating.
Round 5: Snapdeal received its 5th round of funding of $105 million in May-2014.
The 5th round included investments by Blackrock, Temasek Holdings,Premji Invest and
others. The round valued SnapDeal at $1,000,000,000.
Round 6: Snapdeal received its 6th round of funding in Oct-2014 from Softbank with
investments worth $627 million in fresh capital. This makes Softbank the largest investor in
Snapdeal.
Round 7: Snapdeal received its 7th round of funding in Aug-2015 from Alibaba
Group, Foxconn and Softbank with investments worth $500 million in fresh
capital.
Round 11: One of the world's largest pension funds, Ontario Teachers' Pension Plan, and
Singapore-based investment entity Brother Fortune Apparel have led the 11th round of
funding in online marketplace player Snapdeal. The latest investment is $200 million (Rs
1,367.6 crore) in Jasper Infotech-owned company.
Acquisitions
In June 2011, Snapdeal acquired Bangalore-based group buying site,
Grabbon.com.
In April 2012, Snapdeal acquired esportsbuy.com, an online sports goods retailer
based out of Delhi.
In May 2013, Snapdeal acquired Shopo.in, an online marketplace for Indian
handicraft products.
In April 2014, Snapdeal acquired fashion products discovery site,
Doozton.com.
In December 2014, Snapdeal acquired gifting recommendation site,
Wishpicker.com.
In January 2015, Snapdeal acquired a stake in product comparison website
Smartprix.com.
In February 2015, Snapdeal acquired luxury fashion products discovery
site, Exclusively In March 2015, Snapdeal acquired 20% stake in Gojavas.com.
In March 2015, Snapdeal acquired ecommerce management software and
fulfillment solution provider, Unicommerce.com .

8. In March 2015, Snapdeal entered into the financial services marketplace by
acquiring a majority stake of RupeePower which provides a digital platform for
financial products to customers. Mr. Tejasvi Mohanram, the founder of
RupeePower would continue to be the MD&CEO of the company.
In April 2015, Snapdeal acquired mobile-payments company FreeCharge.com.
In September 2015, Snapdeal acquired Reduce Data, a programmatic display
advertising platform.
Recent News On Snapdeal
Snapdeal to invest $100 m in Shopo
E-commerce major Snapdeal will invest $100 million (Rs.665 crore) in Shopo as it looks to
build up the venture into a one million seller-strong platform. Shopo is a mobile-only
platform, which aims to bring small and medium businesses (SMBs) that cannot register on
bigger e-commerce portals.
Business results
In the year 2012-13 Snapdeal had said that it expected revenues of about ₹600 crore (US$91
million). Betting big on the growth of mobile commerce, Kunal Bahl, the CEO, said at the
time that 15-20 per cent of the sales on Snapdeal came through m-commerce. Snapdeal.com
expected the total sale of products traded on its platform to cross ₹2000 crore (US$300
million) in the fiscal year 2013-14 helped by its robust growth in the past two years and the
growing popularity of ecommerce in India. In June 2014, Snapdeal announced that it had
achieved the13 milestone of 1000 sellers on its platform getting sales of over Rs 1
crore.Snapdeal is the fastest growing e-commerce company in India with gross sales over 3
billion dollars annually.