Flipkart's courier seeks to monetise logistics investments, build data for e-commerce

Ekart goes live next week, with cross country delivery in 4 days; by June, it will service 3,800 pin codes, enable pickups in 8 cities

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Ekart, the logistics arm of e-commerce marketplace, Flipkart, has got into the highly competitive courier space. The move would help Flipkart utilise investments made in its logistics arm throughout the year and optimise costs.

The courier service would help Flipkart to collect millions of addresses and location data from delivering packets to end users, helping it better map the consumer base, critical to sell goods for its e-commerce business.

Customers will be able to book the service online, marking the pick-up and drop location on a map using pins rather than entering an address. Flipkart says, this feature will be powered by mapping platform FLIP, a derivative of the company’s move acquiring majority stake in mapping firm MapMyIndia in December last year.  The overlying data that it would gain from the location and addresses from its courier business would be a potential goldmine for building the e-commerce business for Flipkart.

Ekart Courier will go live to the public next week. It will allow consumer send packages and documents across country in under four days. Flipkart says it began testing the service late last year under the codename Flash for a select group of users. By June, it wants to grow Ekart Courier to service 3,800 pin codes and enable pickups across eight cities.

“Through EKART courier, we aim to address significant fundamental challenges faced by consumers such as hunting for a courier agent, tracking the parcel, ensure the parcel is packed securely so it does not get damaged,” said Amitesh Jha, Vice President.

While the service will launch next week, Ekart Courier will continue to evolve. It would be  adding more features such as real-time GPS tracking. An overnight express delivery option is in the works.

Flipkart says it wants a bite out of the Rs 22,000 crore courier sector in India, where only 50 per cent of the sector is structured. If successful, Ekart Courier could drive revenues for the company which seem to have come under pressure from investors to turn profitable. Logistics and advertising are the two paths the company is exploring to offset losses its e-commerce business is making.

With its value marked down from a peak of $15.2 billion to as low as $9 billion by private equity investors, the company has apparently been struggling to raise a new round for over six months.

Having gone in for a big restructuring of its top management earlier this year, Flipkart’s focus is now on reducing burn by cutting discounts and opening up additional revenue streams.

Both logistics and advertising businesses are in the oversight of CEO Binny Bansal.