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How Flipkart Works:Flipkart already had a proven model execution with books and extending to other verticals did not need infrastructural changes. Flipkart’s real achievement has been in solving the pain points in Indian eCommerce that most well funded players are still complaining  about.Here are some of the things that Flipkart has done well in solving each of these problems.1. Discoverability:It is the case with any venture on the web, “How does the customer find us?” Answer: Organically!Flipkart has been the “baap” of SEO. This has been the most important contributor to their success. I say this, because only when you see people coming to you, you get encouraged to deliver more and keep adding. There is no fun (motivation) in adding features to a product that no one is using.Though from what I had noticed, SEO did not come the straight way. There were particularly 2 things that are worth mentioning.a. Yahoo News: Until last year Flipkart had a feed of Yahoo News on its product pages. From what I understand of SEO, this is to increase the keyword density and introduce ‘original’ content on the page, as the product description across all books sites is same. This was removed later as it was violating the Yahoo’s ToS on using the service for a commercial site. Check the Waybackmachine here. I loved the risk they took for this.b. We Do Not Sell Used Books: This one is my favorite. If you check the Waybackmachine in the last line you will notice the following text.We DO NOT sell old books or used books. All the books listed atFlipkart.com are new books.The books listed at Flipkart.com are NOT available for free download inebook or PDF format.The magic of this text is that if you search for “ free ebook“ or “ pdf download” you would always get Flipkart among the top results. These are very popular search queries and Flipkart had nothing to do with it but still they cashed in. This was also the time when Flipkart had Adsense embedded. People would come to the site, see nothing like a “PDF download” button, and then see an ad for PDF download and click. This meant more revenue for Flipkart. I have done this atleast twice myself. Given that the margin on books are very small after the discount, Flipkart was probably earning more by saying what they did not do than by doing what they actually were suppose to do.2. Payments:No credit card/netbanking, fear to transact online, repeat transaction failures, no access to web – these are the common problems with online payments. What Flipkart is doing to overcome these?From what I last counted, Flipkart had atleast 4 different Payment Gateways integrated. They introduced Cash-on-Delivery. Then they are also doing order on phone. Payment via DD/Cheque is also accepted.2 basic things that they are currently doing that takes little tech. effort but quite some product management ‘will’:a. Auto redirection to banking site: Unlike most other ecommerce sites, Flipkart never lands you onCCavenue page, you are auto redirected to the banks page where the info is required to be filled. Flipkart by-passes 1 unnecessary page by passing the required parameters directly to CCavenue and not through a user interface.b. Banks Status: Flipkart maintains its own real time status if the bank’s netbanking is working or not. So there are no surprises after you have chosen the bank and then go to the netbanking page.And if you think Flipkart gets very good rates from Payment Gateways, not really. Atleast 1 big PG that I am aware of charges quite high rates to Flipkart, atleast 40-50% more than to lesser known players.3. Inventory:I come from a traditional business family where we believe in selling what we have. The world of eCommerce really amazes me when I see the players keeping a standard list of products and then go out procuring it only when there is an order placed. Imagine if you go to a brick & mortar shop and after billing the manager sends a boy to a nearby store to get the goods. This is where the problem starts. There is no inventory on their end and there is no live status of inventory from their supplier. Remember The Alchemist, “Never Promise something that you don’t have“.After placing an order, they would keep looking for the product at multiple places. After a week you might get a call saying that either the product is not available and we will do a ‘favor’ by refunding your money or if the product is there, it is not the color/size that you asked for.Flipkart was no different in 2009, a couple my friends used to get similar calls after days of ordering. But for the last 1 year atleast Flipkart maintains its own inventory(or atleast it seems so). They are selling what they have. From pure hearsay, Flipkart is taking up a big warehouse in Bangalore and is in talks for one in NCR as well. One of the few companies that is using the funding to build a business and not spend it like a FMCG company on ads.4. Delivery:I have dealt with courier companies in my last startup and am quite aware of the ‘fcukall’ standards they have. Most similar looking envelopes are never delivered thinking that it is a marketing package and no one would track it. They would be willing to bargain on rates but would never say anything about the service. Paying a premium may not solve the problem always.Flipkart is exploiting this problem as a cashable need gap and building its own delivery backend. Flipkart is seen delivering through their own delivery boys in Bangalore and at times within 12hrs from order.Flipkart has started putting fliers in newspapers in Bangalore with a product listing, call-to-order phone number and a promise of delivering ‘tomorrow’. This means more discoverability, no payment problem and no delivery delay. The way it is actually suppose to be.From what I heard from multiple sources, Flipkart is looking to build its own courier company. The recent$20Mn funding from Tiger Global was only part of a larger sum they are known to be raising. Flipkart is looking to raise $100Mn at a valuation of $200Mn.Recently, Flipkart has started selling everything from cameras, laptops to gaming consoles to personal and health care electronic products. There are major talks about Amazon acquiring Flipkart but it would only make sense to grow it bigger and better from here. A handover wouldn’t see the same product management ‘will’.Flipkart is a story that is come from smart work and an ‘it is possible’ attitude. There is a need to for a couple of more stories like these and there would be no cribbing about Indian eCommerce not working.What do you think of Flipkart story? Do share any interesting features that you noticed at Flipkart.How Amazon Works:In 1995, Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more sold its first book, which shipped from Jeff Bezos' garage in Seattle. In 2006, Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more sells a lot more than books and has sites serving seven countries, with 21 fulfillment centers around the globe totaling more than 9 million square feet of warehouse space.The story is an e-commerce dream, and Jeff Bezos was Time magazine's Person of the Year in 1999. The innovation and business savvy that sustains Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more is legendary and, at times, controversial: The company owns dozens of patents on e-commerce processes that some argue should remain in the public domain. In this article, we'll find out what Amazon does, what makes it different from other e-commerce Web sites and how its technology infrastructure supports its multi-pronged approach to online sales.Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more BasicsOnline Shopping for Electronics, Apparel, Computers, Books, DVDs & more sells lots and lots of stuff. The direct Amazon-to-buyer sales approach is really no different from what happens at most other large, online retailers except for its range of products. You can find beauty supplies, clothing, jewelry, gourmet food, sporting goods, pet supplies, books, CDs, DVDs,computers, furniture, toys, garden supplies, bedding and almost anything else you might want to buy. What makes Amazon a giant is in the details. Besides its tremendous product range, Amazon makes every possible attempt to customize the buyer experience.When you arrive at the homepage, you'll find not only special offers and featured products, but if you've been to Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more before, you'll also find some recommendations just for you. Amazon knows you by name and tries to be your personal shopper.Courtesy Amazon.comThe embedded marketing techniques that Amazon employs to personalize your experience are probably the best example of the company's overall approach to sales: Know your customer very, very well. Customer trackingis an Amazon stronghold. If you let the Web site stick a cookie on yourhard drive, you'll find yourself on the receiving end of all sorts of useful features that make your shopping experience pretty cool, like recommendations based on past purchases and lists of reviews and guides written by users who purchased the products you're looking at.The other main feature that puts Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more on another level is the multi-leveled e-commerce strategy it employs. Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more lets almost anyone sell almost anything using its platform. You can find straight sales of merchandise sold directly by Amazon, like the books it sold back in the mid-'90s out of Jeff Bezos' garage -- only now they're shipped from a very big warehouse. Since 2000, you can also find goods listed by third-party sellers -- individuals, small companies and retailers like Target and Toys 'R Us. You can find used goods, refurbished goods and auctions. You could say that Amazon is simply the ultimate hub for selling merchandise on the Web, except that the company has recently added a more extroverted angle to its strategy.In addition to the affiliate program that lets anybody post Amazon links earn a commission on click-through sales, there's now a program that lets those affiliates (Amazon calls them "associates") build entire Web sites based on Amazon's platform. They can literally create mini Amazon Web sites if they want to, building on Amazon's huge database of products and applications for their own purposes. As long as any purchases go through Amazon, you can build a site called Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more, pull products directly from Amazon's servers, write your own guides and recommendations and earn a cut of any sales. Amazon has become a software developer's playground.Before we dig deeper into Amazon's e-commerce methods, let's take a quick look at the technology infrastructure that makes the whole thing possible.AMAZON'S PROGRESSAmazon has four software development centers worldwide. These units are constantly creating new features for Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more and developing the technology to support them.Amazon TechnologyThe massive technology core that keeps Amazon running is entirely Linux-based. As of 2005, Amazon has the world's three largest Linux databases, with a total capacity of 7.8 terabytes (TB), 18.5 TB and 24.7 TB respectively [ref]. The central Amazon data warehouse is made up of 28 Hewlett Packard servers, with four CPUs per node, running Oracle 9i database software.The data warehouse is roughly divided into three functions: query,historical data and ETL(extract, transform, and load -- a primary database function that pulls data from one source and integrates it into another). The query servers (24.7 TB capacity) contain 15 TB of raw data in 2005; the click history servers (18.5 TB capacity) hold 14 TB of raw data; and the ETL cluster (7.8 TB capacity) contains 5 TB of raw data. Amazon's technology architecture handles millions of back-end operations every day as well as queries from more than half a million third-party sellers. According to a report released by Oracle after it helped migrate Amazon's data warehouse to Linux in 2003 and 2004, the central task process looks something like this:In the 2003 holiday season, Amazon processed a top-end 1 million shipments and 20 million inventory updates in one day. Amazon's sales volume means that hundreds of thousands of people send their credit card numbers to Amazon's servers every day, and security is a major concern. In addition to automatically encrypting credit card numbers during the checkout process, Amazon lets users choose to encrypt every piece of information they enter, like their name, address and gender.Amazon employs the Netscape Secure Commerce Server using the SSL (secure socket layer) protocol (see How Encryption Works to learn about SSL). It stores all credit card numbers in a separate database that's not Internet-accessible, cutting off that possible entry point for hackers. Customers who are particularly cautious can choose to enter only a partial credit card number over the Internet and then provide the rest by phone once the online order is submitted. Aside from the usual security concerns regarding online credit-card purchases, Amazon suffers from the same phishing problem that has plaguedeBay and PayPal, so watch out for fake e-mails asking for your Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more account information. Check out Anti-Phishing Working Group: Amazon.com for details on how to recognize a fake.Now let's get back to the business of selling stuff. Amazon's approach to e-commerce is one that leaves no stone unturned.AMAZON PATENTSAmazon has tried to patent nearly every aspect of its e-commerce architecture, drawing more than a little controversy for the affiliate program patent it won back in 2000. Reportedly, other e-commerce sites were already using affiliate programs that looked a lot like the one Amazon developed and patented. Here are just a few of Amazon's dozens of patents:Internet-based customer referral system, U.S. Patent 6,029,141, February 22, 2000Content personalization based on actions performed during a current browsing session, U.S. Patent 6,853,982, February 8, 2005Method and system for integrating transaction mechanisms over multiple internet sites, U.S. Patent 6,882,981, April 19, 2005Use of product viewing histories of users to identify related products, U.S. Patent 6,912,505, June 28, 2005Amazon E-commerceOnline Shopping for Electronics, Apparel, Computers, Books, DVDs & more has always sold goods out of its own warehouses. It started as a bookseller, pure and simple, and over the last decade has branched out into additional product areas and the third-party sales that now represent a good chunk of its revenue (some estimates put it at 25 percent).Both retailers and individual sellers utilize the Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more platform to sell goods. Large retailers like Nordstrom, Land's End and Target use Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more to sell their products in addition to selling them through their own Web sites. The sales go through Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more and end up at Nordstrom Online & In Store: Shoes, Jewelry, Clothing, Makeup, Dresses, Land's The END Fund or Expect More. Pay Less. for processing and order fulfillment. Amazon essentially leases space to these retailers, who use Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more as a supplemental outlet for their online sales.Small sellers of used and new goods go to Amazon Marketplace, Amazon zShops or Amazon Auctions. At Marketplace, sellers offer goods at a fixed price, and at Auctions they sell their stuff to the highest bidder. Amazon zShops features only used goods at fixed prices. If an item listed on zShops, Marketplace or Auctions is also sold on the main Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more, it appears in a box beside the Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more item so buyers can see if someone else is selling the product for less in one of the other sales channels.Courtesy Online Shopping for Electronics, Apparel, Computers, Books, DVDs & moreThe level of integration that occurs on Amazon is a programming feat that few (if any) online sales sites can match.Another sales channel calledAmazon Advantage is a place where people can sell new books, music and movies directly from the Amazon warehouse instead of from their home or store. Sellers ship a number of units to Amazon, and Amazon handles the entire sales transaction from start to finish. In all of these programs, Amazon gets a cut of each sale (usually about 10 percent to 15 percent) and sometimes charges additional listing or subscription fees; in the case of Amazon Advantage, the company takes a 55 percent commission on each sale. The Advantage channel is something like a consignment setup, a sales avenue for people who create their own music CDs or have self-published a book and are simply looking for a way to get it out there.One of the latest additions to Amazon's repertoire is a subsidiary company called Amazon Services. Through Amazon Services, Amazon sells its sales platform, providing complete Amazon e-commerce packages to companies looking to establish or revamp their e-commerce business. Amazon sets up complete Web sites and technology backbones for other e-commerce companies using Amazon software and technology. Target, for instance, in addition to having a store on Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more, also uses Amazon Services to build and manage its own e-commerce site, Expect More. Pay Less..Expect More. Pay Less. homepageBut selling goods isn't the only way to make money with Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. The Web site's affiliate program is one of the most famous on the Web. Through Amazon's Associate Program, anyone with a Web site can post a link to Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more and earn some money. The link can display a single product chosen by the associate, or it can list several "best seller" products in a particular genre, in which case Amazon updates the list automatically at preset intervals. The associate gets a cut of any sale made directly through that link. The cut ranges from 4 percent to 7.5 percent depending on which fee structure the associate signs up for (see Amazon Associates for complete program details). The associate can also take advantage ofAmazon Web Services, which is the program that lets people use Amazon's utilities for their own purposes. The Amazon Web Services API (application programming interface) lets developers access the Amazon technology infrastructure to build their own applications for their own Web sites. All product sales generated by those Web sites have to go through Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more, and the associate gets a small commission on each sale.Check out Amazon Web Services to learn more about what you can do with Amazon's e-commerce platform.In the next section, we'll take a look at how all of these programs and channels come together to create a sales and marketing powerhouse.Amazon Tools, Marketing and CommunityThe goal is pretty straightforward: "To be Earth's most customer-centric company where people can find and discover anything they want to buy online." The implementation is complex, massive and dynamic. Amazon's marketing structure is a lesson in cost-efficiency and brilliant self-promotion. Amazon's associates link to Amazon products in order to add value to their own Web sites, sending people to Amazon to make their purchases. It costs Amazon practically nothing. Some associates create mini-Amazons -- satellite sites that do new things with Amazon data and send people to the mothership when they're ready to buy. Amazon Light, built and maintained by software developer Alan Taylor, is one of those satellite sites.The level of customer tracking at Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more is another best-of-breed system. Using the data it collects on every registered user during every visit to the Web site, Amazon points users to products they might actually be glad to discover -- and buy. Amazon recommends products that are:similar to what you're currently searching for (on-the-fly recommendations that use up tons of processing power)related to what you've searched for or clicked on at any time in the pastpurchased by other people who've searched for what you're searching for or have bought what you've boughtYou can even customize the recommendations by giving Amazon more information about yourself and your interests and rating the products you've already purchased.A recent development in customer tracking actually collects information on people who may have never visited Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. Amazon's gift-giving recommendations collect data on the stuff you buy for other people. For instance, if you buy a toy train set in December and ship it to your nephew, Amazon knows you give gifts to a boy aged four to 10 who lives in Ohio and likes trains. Might your nephew enjoy the latest addition to that train series? Might he also have an interest in RC cars? Amazon will give you all sorts of ideas about what to get your nephew when the next holiday season rolls around.This type of information gathering has generated a fair amount of controversy. Some say Amazon gathers too much information for comfort, and the Electronic Privacy Information Center reports that in 2000, Amazon started sharing its customer data with its partners and subsidiaries. The concern has increased with the tracking of "gift-giving habits," because the gift-giving information Amazon collects could be about minors, which is against the law, and because the gift receivers don't even know that their name, age, gender, location and interests may be stored in Amazon's database of customer information.Despite concerns about Big Brother Amazon, tons of people love the personalized experience Amazon offers. It's not just sales offers -- there's a community on Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more that's based on people providing even more information about themselves to other Amazon users. People write their own reviews, recommendations, "So You'd Like To..." guides and "Listmania" lists based on Amazon's product offerings and share them with all of Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. One Listmania list, "The Top 25 Weirdest Items You Can Purchase Through Amazon!" by Sheila Chilcote-Collins of Van Wert, Ohio, includes a jar of S.E.P. (Stop Eating Poop) that should make your dog stop eating its own feces; bird feed in the form of live caterpillars shipped to your doorstep; and a book entitled "Owl Puke" that comes complete with a genuine pellet of regurgitated owl meal. You can make any sort of list you want, and any Amazon member can view it and rate it. (Click here to view the Top 100 Listmania lists.)Beyond e-commerce and its trappings, some of the more recent Amazon endeavors have the company branching out into new realms. Amazon's Mechanical Turk project seeks to combine community, technology and compensation. Using the Mechanical Turk system, software and Web developers can post tasks they need help with, usually tasks related to things computers can't do but humans can, like quickly caption a set of photos. Anyone can post a task, and the person who completes it gets a small amount of money in return. Amazon gets a commission on each completed transaction. In a much more visible trek into the unknown, Amazon has funded the A9 search engine. It has full search capabilities, mapping functions, a toolbar with pop-up blocking and an easily accessible personal search history. A9 also provides a "Diary" where you can makes notes to yourself about specific Web pages and lists of recommended links for you to check out based on your previous searches. In keeping with Amazon's omnipresent marketing techniques, you can sign up to get an Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more discount for using A9 on a regular basis, and when you type in a search term, you'll see a display of Amazon book results related to that term.From a "Where's Amazon going?" point of view, perhaps the most notable project is the previously mentioned Amazon Services subsidiary. Amazon Services is building complete e-commerce solutions for companies that are potential Amazon competitors, leaving open the possibility that Amazon will ultimately head in the direction of technology service over retail sales.For more information on Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more and related topics, check out the links on the next page.THE GOLD BOX AND TIMELINE: A FEW HIGHLIGHTSThere's probably a little "Gold Box" icon at the top of the Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more homepage every time you visit. This box holds special treats for you: Time-sensitive discounts. Once you click on the Gold Box and view an offer, you have to complete the transaction (if you want it) in a specified time period. After that time period, the offer disappears.1994: Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more is incorporated.1995: It sells its first book.1996: It launches its affiliate program ("Associates Program").1997: It goes public.1998: It buys the Internet Movie Database (IMDb) and opens two new Amazon stores: Music and DVD/Video.1999: It launches Amazon Auctions and zShops and opens six new stores: Consumer Electronics, Toys & Games, Home Improvement, Software, Video Games and Gift Ideas.2000: It launches Amazon France, Amazon Japan and Amazon Marketplace and opens two new stores: Kitchen and Camera & Photo.2001: It introduces the "Look Inside the Book" function and teams up with Target stores.2002: It launches Amazon Canada and Amazon Web Services and opens two new stores: Office Products and Apparel & Accessories.2003: It launches Amazon Services and Home - A9 subsidiaries and opens three news stores: Sports & Outdoor, Gourmet Food and Health & Personal Care.2004: It buys 亚马逊-网上购物商城：要网购, 就来Z.cn! (which becomes Amazon China) and opens one new store: Beauty.2005: It buys BookSurge LLC.For a complete Amazon timeline, see Amazon.com: Timeline and History.