Letter From The Editor: Surviving the Perfect Storm
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n the last edition, I had raised the issue of how we, as a nation, need to nurture many more first-generation entrepreneurs. There is an absolute dearth of such role models in India. Which is why Flipkart, founded by two friends from IIT-D—Sachin and Binny Bansal—is the poster-boy of India’s internet economy. With the exception of makemytrip.com, there aren’t too many new entrepreneurial ventures in the last 10 years that have created—or are even likely to create—billion-dollar enterprises. Anyone who has ordered music or bought books from their site even once would testify to just how nifty their service is. And it would be fair to say that they’d be amongst the most popular online brands in the country.  So why on earth do we have a cover that seems to suggest that things aren’t exactly hunky-dory inside Flipkart? Simply because that’s the way things really are. We’ve studied Flipkart for weeks, spoken to scores of people—inside and outside the firm—and vetted our hypothesis carefully to bring you a dramatic story that is bound to give you a whole new perspective on one of India’s best known online firms. |
But can they or in future the bigger better giant generate hard, real profits other than on just paper (by accounting manipulations of intangibles). That will be one mammoth task especially in a place like India where everything is readily available to the customer.
The retail e-commerce in the west may flourish, but in India, customers like to actually go the market, see, touch and feel the goods, women like to shop in groups, try on several clothes and finalize one, like to bargain with the shopkeeper, majority college students swear by flea markets and other budget shopping areas. The real estate boom makes sure that every brand sets its shop at a mall nearest to your place. Indians just don't have a lifestyle for retail shopping online. Maybe the B2B or any other area e-commerce may prosper but retail shopping online will lose its flavour over time.
If reports surrounding the Forbes article are true (or not). Flipkart's stance and approach (communication wise) is defensive and abrasive at the same time. It depicts an image of the company management as picky and need young guys who have NO IDEA what the communications team is up to! Firstly they write a loosely crafted email to the editor of Forbes(from a founder himself), and contradict themselves in a blog (Which is the WORST I have see in AGES). For all the damage done by the Forbes article, is this the best response the communication team can churn out??? A non-relevant-trying -to-be-funny-and-defensive blog??
As a founder of a start-up myself, I think the best lesson learnt for me here is to hire the right communication guys for the job first!
I believe, it's the issue of the business model that the owners have decided to execute. Also, when i read the story over and over, i realised that the business was 'made-to-sell', and that's something that i confirmed with a senior executive who works for fipkart. They are just working towards better valuation and that's about it.
p.s.: I would not like them to fail and I am certain that instead of being in the denial mode, the management at Flipkart looks at this criticism constructively and prove everybody wrong.
