 "Kalyan Krishnamurthy")
As Flipkart moves to its next phase of growth under Walmart, its Chief Executive Officer Kalyan Krishnamurthy says he is not worried about the competition (read Amazon) and, instead, wants to focus on creating synergies with the American retail giant. He tells Alnoor Peermohamed and Bibhu Ranjan Mishra that he will continue on the path charted in the last two years. Edited excerpts:
What changed at Flipkart after the Walmart investment and what will change in 2019?
Things are actually very good (here), we don't want to change anything. We have been a growth story for the past 10 years and we do believe that it will continue to be the case for the next decade. We have been an innovation-led firm, which deeply cares for its customers, and none of those philosophies will change.
What about the organisational structure? Jabong is being integrated with Myntra and there's talk that Myntra will further get integrated with Flipkart.
There will be no integration between Myntra and Flipkart. Myntra has a unique customer value proposition. All the functions in Myntra will report to the Myntra CEO.
So, there is no plan to bring them together. From a customer point of view, Myntra will be a separate brand and a separate firm for the next 10 years or so.
Is Myntra CEO Ananth Narayanan quitting?
We don't want to do guesswork here. We don't want to speculate on the future of our senior leader.
In the past, you have said without grocery, e-commerce will remain a small percentage of retail sales in India. In terms of GMV (gross merchandised value), what is your expectation from the new categories?
It's been some time since we focused on GMV as a metric. Our primary metric is customers and transactions, and those are growing well for us. We do believe all the things that we are doing will continue to drive the growth as the penetration of most of these retail and product categories (online) in India is in low single digits.
But it looks like growth is kind of slowing down for Flipkart?
No, it isn't. If you look at last year compared to the previous one, we accelerated growth in terms of customers and transactions. It's a little less than triple-digit growth in terms of transactions and we don't see it slowing down.
There are reports that say Amazon is already neck and neck with you in terms of GMV and may overtake you soon?
We don't subscribe to that. We believe Flipkart as a group is at least 2X the next competitor. We don't have to follow market reports. Company filings don't have customer metrics and don't have a lot of things we care about.
The general perception is that you were brought in by Tiger Global to grow Flipkart. Today, Tiger has just around 5 per cent stake and tomorrow it may not continue to be an investor. Will Kalyan continue as CEO?
Nothing changes. I'm not an employee of Tiger Global, I'm an employee of Flipkart. I'm extremely committed to the business and a big part of my working life has been spent in relation to Flipkart. And a very big part of my working life has been spent in e-commerce. I actually don't see myself leaving this industry as well as Flipkart anytime soon.
Flipkart founders always prioritised growth over profits. Is this going to change?
We've brought in a lot of cost discipline into the company. We reset the base a few years ago and it's worked very well in our favour. We don't want to go in and do any more surgery to our P&L (profit and loss). The focus is to innovate and grow. We're in a very comfortable position; our board has put faith on us from a financial architecture point of view.
Amazon is investing heavily in omni-channel by acquiring offline retailers. Does Flipkart have any such plans?
Omnichannel will be needed in many ways, but we're not anywhere close to it. We want to do the right thing and not jump into it. But would we want to partner with the physical commerce firms in this country and both be successful? Absolutely, yes. We will eventually do that, but we don't know yet the kind of a partnership this will be. We also have to respect the law of the land, but it will happen.
