Flipkart taps analytics to deliver more sales on low marketing spend

The firm has a clear focus on tapping targeted customer base, which includes regulars, newcomers

India's largest e-commerce marketplace Flipkart has relied on analytics to understand user behaviour on its app and website, and create an outreach programme to tap customers and get them to shop on its platform. The initiative saw its sales grow five-fold during its recent Big 10 sale.
 
The online shopping platform spent only a third of its marketing spend to achieve nearly 80 per cent sales during its flagship Big Billion day sale. The digital focus, using a combination of customised ads on Google and Facebook and conversing with start-ups such as Ola, Swiggy and MakemyTrip was made to engage users to build curiosity and eventually shop on its platform. It did not share specific numbers.
 
Around 13 small video creatives were played on digital platforms to kindle interest and engage with users, before they look at the offers on Flipkart. With a clear focus on tapping the targeted customer base, which include regulars as well as newcomers, it could convert significant percentage to buy goods, the firm said.
 
"Consumer behaviour in the digital world is different. They have short attention span and customers have far higher choice," says Shoumyan Biswas, head of marketing for Flipkart.
 
So Flipkart ran the campaign over four phases - creating interest, engaging them with offers and prompt them to look and buy products on the platform. The sale has helped to get more first time online shoppers to buy from it with offerings such as no-cost equated monthly instalments (EMIs), guaranteed buybacks and product exchange. The move also helped to reduce its reliance on offering discounts to boost sales.
 
Flipkart saw customers buy over two-thirds of its customers spend more to buy higher priced smartphones with the offers during a five-day long sale that ended on May 18.
 
"We exposed to the larger base of our communication and reinforced different benefits, including offers and contests and slowly narrowed the funnel," says Kartikeya Bhandari, Senior Director, Marketing at Flipkart. The company looked at user behaviour on app and on its website over six months and target them for the sale period.
 
Flipkart's focus to maximise returns comes after the company raised a massive $1.4 billion in funding from Tencent, eBay and Microsoft. The company will utilise capital to take on global rival Amazon, but isn't expected to engage in money burning tactics such as discounting and excessive marketing.
 
With all large players now having access to long-term capital, experts are of the notion that India's e-commerce industry will see more sober growth in the coming years. This however will not mean stingier marketing spends, but more meaningful marketing to improve brand recognition rather than advertising discounts.