ASSIGNMENT ON STRATEGIC MANAGEMENT COMPANY: MYNTRA.COM Submitted By: AMIT KUMAR ROLL NO.

: 12 (PGDIE-40) NITIE, Mumbai 1

Contents Beginning of Myntra.com ........................................................ ............................................................... 3 Industry/Servi ce ............................................................................. ......................................................... 3 Products ........... ................................................................................ ....................................................... 3 Competitors .......... ................................................................................ .................................................. 4 Resources ................. ................................................................................ ............................................... 4 Capabilities ................. ................................................................................ ............................................. 5 VRIN Analysis .................. ................................................................................ ........................................ 5 Revenue Model ....................... ................................................................................ ................................ 6 Value Chain analysis......................... ................................................................................ ....................... 7 Revenue .............................................. ................................................................................ .................... 8 Five Force Model......................................... ................................................................................ ............ 8 PESTLE Analysis ................................................. ................................................................................ ...... 9 Competitive Advantage ................................................. ....................................................................... 10 Initi al Funding ..................................................................... .................................................................. 10 Technology ............................................................................... ............................................................. 10 Manpower....... ................................................................................ ...................................................... 11 References ........... ................................................................................ ................................................. 11 2

Beginning of Myntra.com Myntra was established by Mukesh Bansal, Ashutosh Lawania and Vineet Saxena in F ebruary 2007. All three are IIT alumni and have been associated with several sta rt-ups. Myntra is headquartered in Bangalore with regional offices in New Delhi, Mumbai and Chennai. The company started off in the business of personalization of products, and soon expanded to set up regional offices in New Delhi, Mumbai a nd Chennai. It began its operations in the B2B (business to business) segment wi th the personalization of gifts, which included T-shirts, mugs and caps to name a few. However, in 2010, the company shifted its strategy to becoming a B2C (bus iness to customer) oriented firm, expanding its catalogue to fashion and lifesty le products. Myntra.com is ranked among the top 10 e-commerce companies in India and is scaling rapidly. In the last 3 years, Myntra has become the most popular destination for personalized products in the country. Building on the success o f personalization, Myntra is expanding into broader Lifestyle/Fashion retailing. Started: February 2007 Milestone 1: In October 2007 Myntra received a seed fund ing from Accel Partners (formerly Erasmic Venture Fund), Sasha Mirchandani from Mumbai Angels and another angel investor. Milestone 2: In 2008 they touched 1000 daily visitors mark. Milestone 3: In 2009 they touched 4000 daily visitors mark and were awarded Pride of India 20092010 award for exceptional business growth by IDG Ventures. Milestone 4: In 2010 Myntra was the Red Herring Global 100 winner . Milestone 5: By 2012 February Myntra was shipping 10,000 products every day. V ision: To become Indias largest online lifestyle products retailer. Industry/Service Myntra.com is into the e-commerce (online shopping) business. It is an online re tailer of fashion and lifestyle products in India. Products From 2007 to December 2010, Myntra.com was in the business of online demand pers onalization. The products ranged from T-shirts, mugs, greeting cards, calendars, key chains, diaries, wine glasses, coasters and many such products with photogr aphs, one-liners and slogans. Myntra pioneered the personalisation of sports jer seys and offered sports jerseys of several cricket and football teams such as Te am India, IPL, FIFA and EPL. These jerseys could be personalised with a name and number of the customers choice. Myntra has tied up with top fashion and lifestyl e brands in India, such as Nike, Reebok, Puma, Adidas, Asics, Lee, Lotto, Decath lon, FIFA, John Miller, Indigo Nation etc. to offer a wide range of current seas on merchandise from these brands. Myntra currently offers products from more tha n 3

200 Indian and international brands. These include shoes for running, tennis, fo otball, basketball and fitness, along with casual footwear from world-renowned i ndustry leaders like Nike, Puma, Converse, Adidas, Decathlon, Reebok, Lee Cooper , Numero Uno, Skechers, Crocks, Asics, Fila, Lotto, ID and many more. There are also casual and dressy footwear for women from Catwalk, Carlton London and Red T ape to name a few. Competitors Myntra undoubtedly enjoyed the first mover advantage in the online retailing bus iness. But Myntras success has been replicated by other companies that have now b ecome competitors for Myntra. Some of them are Scopial.com, Blue Bus Tees, dilse bol.com, Inkfruit.com. Resources Capital: Till date Myntra has received capital from various venture capital firm s. Some of them are: Accel Partners (formerly Erasmic Venture Fund), Sasha Mirch andani from Mumbai Angels, NEAIndoUS Ventures, IDG Ventures etc. Thus they have enough capital to try out new ideas and experiment. Myntra has a state of the ar t office in Bangalore. Myntras new age office with a capacity to seat over 400 em ployees, boasts of some of the best facilities for its employees. With respect t o the online retailing industry, the importance of capital can be rated to be 3/ 5. Relative to competitors Myntra has received quite a lot of funds from venture capitalist. Therefore it can be rated 4/5 Human Resource: Myntra is a small organization with about 250 employees. Many of the employees have IIT/IIM background and have left illustrious careers in Sili con Valley to be a part of this company. They play best in class salary and thus are able to attract and retain talent. With respect to the online retailing ind ustry, the importance of capital can be rated to be 2/5. This is because, though the human resource required if highly skilled, there is a lot of engineers avai lable. Relative to competitors Myntra employees better qualified employees as ca n be inferred from the Job description that is available on their website. Hence rating can be 3/5. Partnership with various brands: Over the period of years My ntra has established partnerships with more than 250 national and international brands in order to sell their merchandise online. Myntra has tied up with top fa shion and lifestyle brands in India, such as Nike, Reebok, Puma, Adidas, Asics, Lee, Lotto, Decathlon, FIFA, John Miller, Indigo Nation etc. to offer a wide ran ge of current season merchandise from these brands. Myntra has also partnered wi th IPL and is currently the official supplier of customized jerseys. With refere nce to the respective industry in which Myntra operates, it is very important to provide the customer with as many options as possible. By establishing partners hips with many brands, Myntra has done a very good job. Therefore a rating of 5/ 5 seems apt. None of its competitors are able to provide a similar variety and c hoice of brands. Thus we can give a rating of 5/5. 4

Capabilities Technological: Myntra maintains its website which provides the only means by whi ch a customer can make a purchase. To maintain, upgrade and improve the website and the user experience, Myntra employees many computer science engineers and ex perienced professionals. In the e-commerce industry, it is very important to hav e a state of the art technological infrastructure. Rating : 4/5 As compared to i ts competitors their online experience their website provides to the customers i s at par or better than that of its competitors, Hence we can give a rating of 4 /5. Order Processing and Delivery: Myntra attempts to order and ship every order within 24 hrs. It offers free shipping within India on all products above Rs 99 and has delivered products over 10,000 zip codes across the country. It can shi p internationally to all major countries. Same as technology, the order processi ng and delivery are also very important for an e-commerce venture, we can give a rating of 5/5. Myntra performs order processing and delivery very well. Infact the CEO of the company has stated that they have world class warehouses in vario us cities and an important focus on supply chain. We can rate this capability as 4/5. Marketing: Myntra is very responsive to market trends and always keeps the latest designs and merchandise in its online catalogue. Myntra has successfully used social networking websites Facebook and Twitter to expand its customer bas e. Myntra positions itself as a fashionable new age brand. It launches major mar keting campaigns every year. In February 2012, Myntra rolled out an OOH (out of home) campaign across Tier 2 cities to build brand awareness and promote online shopping. Marketing is very important for a company engaged in online retailing. Myntra has used mostly viral marketing and internet for its popularity coupled with occasional discounts and referral discounts. It can be given a rating of 3/ 5. With respect to competitors Myntra stands out in its popularity, thus a ratin g of 4/5 can be given. VRIN Analysis VRIN Analysis enables SME managers to recognize their core competencies and key sources of competitive advantage. VRIN tells SMEs what they should do, given the relative strengths and weaknesses of their resources and capabilities. Then SME managers job is to bundle resources and capabilities to achieve competitive adva ntage. 5

Valuable Rare Inimitable Non Substitutable NO Remarks Capital YES YES NO Comparative Competitive advantage Human Resource Partnership with brands YES NO NO NO YES YES NO YES Sustainable Competitive advantage Technology Order Processing and Delivery Marketing YES YES YES YES NO NO YES YES Comparative Competitive advantage YES NO NO YES Revenue Model Myntra.com is an aggregator of many brands. Its business model is based on procu

ring current season merchandise from various brands and making them available on the portal at the same time as in respective retail brand outlets. All these pr oducts are offered to customers on MRP. It is a Business to Customer (B to C) re venue model. Customer orders from website and makes payment Customer Firm Shipping Packaging Order Processing 6

Value Chain analysis The following diagram illustrates the value chain concept Out of all the primary and support activities mentioned in the diagram, the firm performs the following activities: Firm Infrastructure Human Resource Managemen t Technology Procurement Outbound Logistics Marketing and Sales. As far as the Firm Infrastructure is concerned Myntra has a state of the art hea d office. The basic requirement of Myntra was for the office to reflect youthful ness, freshness, and vibrancy while incorporating fashion as the overall theme. The design team left no stone unturned in making this dream a reality. The offic e infrastructure is better than that of most competitors. Human resource managem ent is one such support activity that can make or break any organisation in the long run. By reading about the HR policies in Myntra we can say that it is a ver y employee friendly organisation. The firm focuses on work-life balance. In HRM also this company is better than many e-commerce companies. Technology is what d ifferentiates e-commerce from other types of retail. Technology allows online re tail to be possible by hosting the website in which the customer can browse thro ugh the online catalogue, choose what he wants to buy, make online payment and r eceive the goods at his/her doorstep. Almost all e-commerce companies maintain t heir own websites by themselves; this allows them to make frequent changes and c orrections as and when needed. With respect to technology Myntra is as good as a ny other online retailing company. 7

Procurement is important for Myntra as they deal in merchandising; they receive the finished goods from various brands, store them at their various warehouses a nd then ship them to the customer when ordered. Outbound logistics is one of the critical activities for Myntra. They use a third party courier for their outbou nd logistics. It is their responsibility to give the demanded product to the thi rd party courier as soon as possible. They then keep track of the lead time and try to reduce it with collaboration from the courier company. Marketing and Sale s is a core activity of Myntra. By looking at the popularity of Myntra vis a vis other online retailing companies we can conclude that Myntra is doing a much be tter job in Marketing. Revenue Revenue (In Crore Rs) 80 70 60 50 40 30 20 10 0 2009 2010 2011 2012 9 3 25 Revenue (In Crore Rs) 75 Five Force Model 8

Porter s five forces analysis is a framework for industry analysis and business strategy development which draws upon industrial organization economics to deriv e five forces that determine the competitive intensity and therefore attractiven ess of a market. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a business unit to re-assess the marketplace given the overal l change in industry information. Threat of New Competition: In the Online Retai ling industry Myntra has already established the largest market share. But since the barriers to entry/exit and setup capital and working capital are low in thi s industry, threat of a new entrant becomes high. Threat of substitute services: Online retailing can be considered to be a substitute to the usual shop retaili ng. Myntra cannot provide the customer with a real retailing experience but at t he same time gives the convenience of shopping from home/office. Currently there does not appear any other substitute service. Thus this threat is low. Bargaini ng Power of Customers: The bargaining power of customers is also described as th e market of outputs: the ability of customers to put the firm under pressure, wh ich also affects the customer s sensitivity to price changes. Customers can very easily switch to some other online retailer; this puts pressure on the company to continuously improvise on their service so as to keep their users satisfied. Therefore bargaining power of customers is high. Bargaining Power of Suppliers: The suppliers in this case are the various brands whose products are being sold by the company. They can demand an increase in their profit margin and put press ure on the company. The supplier may choose a competitor of the firm to do busin ess since the supplier switching costs are low. Therefore the bargaining power o f suppliers is high and Myntra needs to have good supplier relations. Intensity of competitive rivalry: For most industries, the intensity of competitive rivalr y is the major determinant of the competitiveness of the industry. In this parti cular case the current rivaly, rather competition is not very high, but in futur e it will be. PESTLE Analysis PESTLE Factors Political Key Points Government is planning to allow 100% FDI in retail, this will allow retailers like Walmart to enter the Indian market. Relev ance to Myntra Can be considered as threat from substitute High government investment in National IT Faster, better and more infrastructure s reliable internet access for national users Economic Despite the economy slowd own in the previous years, the company had been growing by providing discounts t o customers Many more people getting internet connections More online buyers wit h a growing economy 9

Social Increase in social networking e-marketer online Marketing has take advantage of channel Product category risk and financial risk decrease online shopping Technological Environmental Legal Need to consider overcoming risks to increase user There is an increase in broad casting, information Increase frequency of use and telecommunications technologi es for and sources internet access Rapid development of high-speed network Media-r ich contents are services(e.g. broadband) increases usability of easily made ava ilable to media-rich online buyers Global Warming/ Pollution Awareness Less car journeys, more shopping online. Have to become more green to attract Changing busi ness methods consumers and environment to become more green ,i.e. with postage and packaging, work environment No uniform regulations governing e-commerce Be awar e of both the covering all the countries domestic and international laws Competitive Advantage Competitive advantage can be due to a cost leadership or product differentiation or both. In the case of Myntra the competitive advantage is mostly due to cost leadership. This is because it is able to provide the latest designs of various products of various brands at the MRP. Sometimes it gives discounts also and on top of it the shipping is done free of charge. In special cases it also enjoys c ompetitive advantage due to product differentiation. In case of IPL tshirts the buyer can get his/her name imprinted on it. Also Myntras business model up till 2 009 was of customized t-shirts and mugs etc which allowed it to have product dif ferentiation. Initial Funding In October 2007, Myntra received a seed funding from Accel Partners. The amount of the seed fund is not known. Technology Since the company is engaged in online retailing the technology required is adva nced. Maintaining a website were shopping is possible requires a high investment in technology. With an exponential increase in the number of customers visiting the website everyday this task becomes even more important. 10

Manpower The kind of manpower required is highy skilled manpower. Since the company is en gaged in online retailing. To excel in online retailing, company needs to mainta in the website and safe online transactions. Company needs to engage in good mar keting to attract and retain customers. References 1. http://en.wikipedia.org/wiki/Myntra.com (accessed on 07-04-2012) 2. http://ww w.afaqs.com/news/company_briefs/index.html?id=44701_Myntra.com+clicks+int o+T20+ as+Official+merchandise+partner (accessed on 07-04-2012) 3. http://www.businessstandard.com/india/news/dressed-totee/413537/ (accessed on 07-042012) 4. http:// businesstoday.intoday.in/story/e-commerce-myntra-aims-to-dominate-fashionmerchan dising/1/15058.html (accessed on 07-04-2012) 5. http://businesstoday.intoday.in/ story/e-commerce-myntra-aims-to-dominate-fashionmerchandising/1/15058.html# (acc essed on 07-04-2012) 6. http://www.medianama.com/2011/03/223-myntra-gets-14m-insecond-round-funding/ (accessed on 07-04-2012) 7. http://www.thehindu.com/busine ss/companies/article2433066.ece (accessed on 07-042012) 8. http://articles.econo mictimes.indiatimes.com/2011-07-11/news/29761379_1_internationalbrands-categorybrand-campaign (accessed on 07-04-2012) 9. http://www.moneylife.in/business-wire -news/myntracom-targets-rs-500-crores-revenuefor-the-next-fiscal/30099.html (acc essed on 07-04-2012) 10. http://www.magnamags.com/index.php?option=com_content&t ask=view&id=9151&Itemid =217 (accessed on 07-04-2012) 11. http://www.indiaprwire .com/pressrelease/electronic-commerce/2009042223914.pdf (accessed on 07-04-2012) 12. Kavita, Pandey, U.S., 2012. E-Commerce Implementation, Problems, Solutions and Popularity in Managing Supply Chain: A Comparative Analysis of Different Top 10 Indian e-commerce Companies. International Journal of Computer Science and t echnology. Vol. 3 Issue 1. 11

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