Bengaluru: India’s largest e-commerce firm Flipkart will in August make a renewed attempt at a customer loyalty programme as it seeks to challenge Amazon’s subscription service Prime that has become popular with customers. Flipkart Plus, which will be launched on 15 August, will be a no-fee, points-based programme for regular customers of Flipkart (customers will earn points or coins with every purchase).
In addition to benefits on its own platform, the firm will offer more discounts, free and faster product deliveries and other rewards to Flipkart Plus subscribers on platforms like Hotstar, Zomato, Makemytrip and Café Coffee Day. For instance, if customers earn enough coins, they can unlock a yearly subscription to Hotstar. Flipkart plans to keep adding more internet and consumer brand partners to the programme.
“Every time a customer completes a purchase on our platform, the customer earns a certain amount of Plus points. As you shop more, you earn more Plus points. And with more Plus points, you unlock key rewards and benefits,” said Shoumyan Biswas, head of advertising, marketing and Plus at Flipkart.
Mint reported in October that Flipkart was planning to relaunch its loyalty programme to take on Amazon Prime.
Flipkart Plus is Flipkart’s second effort at a loyalty service after its Flipkart First programme fizzled out because the firm didn’t push it aggressively.
“It is different from the earlier initiative (Flipkart First). Like with every initiative, we have certain learnings,” Biswas said in an interview.
“If you see some of the design choices we’ve made, like keeping currency at the centre of it, it is not just to provide benefits which are on the platform, but outside the platform as well. And also, we decided to shave off the membership fee. These are some changes we’ve made,” he said.
Flipkart’s programme is an effort to improve customer loyalty and increase spending on its platform from existing customers.
Plus will compete with Amazon Prime, the ₹ 999 yearly subscription programme that offers free and fast product deliveries, bigger discounts, video content and music.
Prime has become an important differentiator for Amazon in its battle against Flipkart, comprising 30% of all orders on Amazon India. Prime has proven to be particularly popular with the well-off in India, who continue to account for the largest chunk of spending on e-commerce platforms.
Flipkart’s programme will aim to reduce Amazon’s increasing dominance in urban areas. If Plus becomes popular, it will help Flipkart, which agreed to sell a majority stake to Walmart in May, increase its lead over Amazon at the top of India’s $18 billion e-commerce market.
After a weak, 18-month run starting in early 2015 when it lost ground to Amazon, a rejuvenated Flipkart under CEO Kalyan Krishnamurthy has consistently pulled in higher sales than its arch-rival.
Walmart’s entry as its controlling shareholder is expected to give Flipkart long-term funds to compete with Amazon and allow it to put all its energies toward expanding sales.