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Last Updated : Oct 13, 2018 11:04 AM IST | Source: Moneycontrol.com

The business of Big Billion Days: Inside Flipkart's 'War Room' 

The Big Billion Days sale consumes all hands on Flipkart’s deck as it defines the company’s market leadership. Especially, when cash-rich rival Amazon too is running The Great Indian Festival — its biggest sale of the year.

Priyanka Sahay @priyankasahay

It’s almost midnight and the excitement on the floor is contagious, disco lights beaming, painting people’s faces in many hues. Bollywood numbers are streaming through a jukebox. No, this isn’t a scene at a club or a party — it is headquarters of Walmart-owned Flipkart in Bengaluru. The reason? Flipkart’s Big Billion Days sale.

On the floor is co-founder Binny Bansal, donning a black t-shirt with Big Billion Days logo on it and a jacket on top, talking to Flipkart executives striving to make the etailer’s flagship annual sale a huge success.

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The Big Billion Days sale consumes all hands on Flipkart’s deck as it defines the company’s market leadership. Especially, when cash-rich rival Amazon too is running The Great Indian Festival — its biggest sale of the year.

Conventionally, the preparation for these sales begins by July or August. It is a fight for supremacy for the two giants whose cash coffers are filled to the brim, ready to be opened any time.

While Amazon sees India as a big opportunity outside the US, it is now fighting this war with global retail giant Walmart, much like the two firms compete in the home country.

Earlier this year, Walmart acquired Flipkart in a $16 billion deal. Ahead of the sale season, Flipkart infused some Rs 3,400 crore into its main e-commerce unit, Flipkart Internet. Amazon, meanwhile, pumped in $1 billion in its marketplace unit Amazon Seller Services this year.

In a couple of days, the winner will be decided. But for now, the war is on.

Name of the game — Smartphones

In a few minutes, the Day 2 of Flipkart’s five-day sale will begin. Like every year, Flipkart has kept special days for different categories. While fashion, television and furniture were slotted for Day 1, smartphones for the next day.

Traditionally, smartphones is one of the most sold categories on Flipkart and Day 2 beat expectations. Later we will get to know that the company sold record by three million smartphones in a single day, allowing it to corner 85-90% of the smartphone market share for the day.



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Interestingly, this happens a day after Amazon claimed to have sold 3 out of every 4 phones sold in India in a single day. It claimed that smartphone maker Xiaomi sold more than one million units while OnePlus saw a record booking worth Rs 400 crore on the platform.

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CEOSpeak: ‘See Amazon losing relevance in India’

For now, I am taken to a conference room where chief executive officer Kalyan Krishnamurthy is waiting. Unlike the rest of the workplace, here the décor is minimalistic. Green chairs, white table, a water dispenser and a few coffee mugs.

“It's early into the sale but is doing extremely well for us. It will be a very big spike than last year. It has been very difficult to pull something like this through especially from an operations point of view,” says Krishnamurthy.

Industry estimates peg the orders during the event to double from regular days to 4.5 million daily. In order to cater to this spike a lot of processes and capacities need to be brought into play.

However, these may become redundant after the sale is off. So the companies need to make sure that they are not leaving money on the table because once the business settles down, they won’t want to have all those fixed assets.

Therefore, in order to cater to the spike in demand, Amazon has hired around 50,000 workers to pick, pack and ship orders while Flipkart has hired some 30,000 workers.

Quite a few of them are temporary workforce hired for the festival season.

Krishnamurthy also calls 2018 “a year of private label products” as the company expects its next 100 million customers to come from Tier 2-3 cities. While private labels offer companies good margins, value-conscious buyer get a cheaper option against larger brands. Flipkart currently has around 200 private label categories.

When asked if Flipkart might lose customers to rival Amazon given both have started sale on the same day, Krishnamurthy snaps, “We see them losing relevance in India.”

“There have been (foreign) companies in the past in the last 40-50 years who have played the country really well, with a lot of deeper understanding. But in the competition we see today, we don't see so much of understanding. The kind of influence we have over our customers, the kind of understanding we have (is way better),” he says, mincing no words.

Well, it is not new for Flipkart to criticise the rival. During the 2016 festive sale, the company had claimed that Amazon’s numbers were inflated because it was selling memberships and small-ticket items like “hing and churan”.

The remark worked in Amazon’s favour which retorted that India’s e-commerce was at an inflection point with the online purchase of items of daily use becoming a habit and that the online retail was not just about selling mobile phones.

In fact, Amazon has now mostly refrained from commenting on the competition calling themselves customer-obsessed.

On being if Walmart had a say in this year’s event, Krishnamurthy calls Big Billion Days a “local event”. “We get a lot of advice from investors on board. They have rich and deep expertise but this concept is very local to India,” he says.

Soon we are joined by other executives and category heads.

Chief marketing officer Shoumyan Biswas says that the media budget to promote the event was lower this year compared to the year before. This even as the company has roped in every celebrity under the sun including Bollywood A-listers like Amitabh Bachchan to cricket stars such as Mahendra Singh Dhoni.

Rishi Vasudev, who heads Flipkart fashion, says that the category has 35 percent market share. It will go up to 50 percent during the festive period and will exit at 45 percent.

Last year, the Flipkart Group, which also owns Myntra and Jabong, had claimed 80 percent market share in fashion during Big Billion Days sale. This year Myntra and Jabong are running separate sale called Big Fashion Days.

Flipkart War Room

War rooms are zones created where executives can keep a tab on the live developments as an end consumer buys products on his or her screens.

Hundreds of employees can be seen gazing into the computer screens, monitoring every activity live to ensure that things run smoothly.

For the Big Billion Days, Flipkart has converted its ground floor into a temporary hub. Hundreds of employees from different floors have come together to work on one floor.

Many of the employees are lying on mattresses with laptops kept on their stomach, some just sitting and frantically typing stuff on keyboards. They are running the front end, taking good view of the statistics and keeping the merchandise alive.

The level of stress and anxiety is palpable, so is the excitement. “It doesn’t feel like morning or evenings. It is like this all day through,” says one of employees.

“In order to keep the stress level under control, there is the whole set of entertainment outside,” says another one pointing towards the music station and candy vendors as she shows me somebody reaching out to the jukebox to play a popular number.

Smartphone sale

It’s five minutes to midnight. The mobile phone sale will open soon.

I am taken to the second war room where the activity will take place. Hundreds of people are gazing at multiple life size projector screens with bated breath in the hall. Many are running into the hall with food packets in hand. They certainly do not want to miss out on the excitement by having dinner outside.

The screen is showing live numbers with statistics of the sale.

I am requested to keep the numbers to myself since the company will come up with official statement once the sale is over.

Suddenly, the countdown begins and with that begins hooting and clapping. The clock strikes 12 and the numbers on the screen start to rise like mercury, within seconds.

Hearing the noise, people from the other war rooms pour to join their colleagues. The noise only grows further and so do the numbers.

A bunch of young men and women are busy taking selfie displaying victory signs. As I leave the hall, I am told that the war has just begun.

While neither Amazon, nor Flipkart have shared their expectation in terms of gross merchandise value (GMV) or orders to be sold during the festive period, research firm Redseer Consulting has predicted that online retail firms, led by the two giants, will sell around $3 billion worth of goods during the five-day sale this year.

First Published on Oct 13, 2018 11:04 am
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