29/11/201 8

BIGBASKET CASE STUDY

ANUBHAV AND TEAM

History Behind BigBasket

The founders of BigBasket first time got

together in 1999 and started one of the first
online business in India with the name of
fabmart. As a part of fabmart they started
online grocery business as Fabmart.com. This
business did exceedingly well in the market
and company went to set up various physical
supermarkets in South India. In 2006 FabMart
was acquired by Aditya Birla Group and
renamed the brand to more Supermarket.
However, the same team got back in 2011 and
launched BigBasket.
Abhinay Choudhari and Mr. V S Ramesh.
BigBasket currently operates BigBasket is
India’s biggest online store for grocery
shopping. It was founded in 2011 by a group
of people named Mr. V S Sudhakar, Mr. Hari
Menon, Mr. Vipul Parekh, Mr. Bangalore
Hyderabad and Mumbai providing their
services in 22 different cities of India.
Bigbasket currently offers more than 18,000
products across various categories and features
more than 1000 brands in its catalogue.
BigBasket currently has revenue of around
$3.2 million and approximately 4000
employees.Hari Menon is the co-founder and
CEO of India’s largest supermarket, Big
Basket..Shah Rukh Khan is currently the
brand ambassador of BigBasket.
Creation Of The Brand - Big Basket

Bigbasket was launched at the time when

India’s busy workforce in cities , finding it
difficult to allocate time to buy groceries and
home essentials .Shopping groceries have
never been an easy task for buyers, even the
housewives. To top it, local grocery stores are
one of the most crowded places today,
especially in metropolises. Bigbasket gave
them the flexibility to place their order
anytime and get the things delivered at their
preferred time .Bigbasket B2C players like
Grofers and Instacart already have their
personalized apps to make grocery shopping
convenient for their shoppers. To beat the
competition, brands like BigBasket have made
their online grocery. Bigbasket comes with the
promise of “lowest rates and prompt delivery
services”. By this motive big basket created a
“New Application” in play store. so the people
can book the groceries through Application or
online. This Application have the following
features: -
● Delivery of groceries on demand.

● The ‘aisle mapping feature’ allows buyers

to check and buy specific items displayed

on the grocery shop aisles.
● The smart navigation process guides the

buyers through the quickest route to book

the grocery items.
These are some important features that created
the brand name of big basket in the market .
MARKET SHARE OF BIGBASKET :-
The Indian online grocery market is a
competitive
landscape with multiple Players. In 2018, As
part of the partnership, Yippee ‘My range’
will be available exclusively on Bigbasket for
one week, following which it will be
distributed to all modern format and general
trade stores across India. Big Basket, with its
determination to hit a $1 Bn run rate by FY19-
end, will surely create the next level of
disruption in the crowded and competitive
grocery market. It seems set to give stiff
competition to Amazon and Walmart. Market
share can be listed as follows,
S.No Financial year Market Share
1 2011-12 30
2 2012-13 71
3 2013-14 178
4 2014-15 223
5 2015-16 527
6 2016-17 663
7 2017-18 1090
 Market share of Big Basket Year wise
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

1% 3%

7%
9%
45%
13%

22%

BRAND MANAGEMENT:-Big Basket is

India’s largest online supermarket and allows
a customer to walk away from the grocery
stoppings . The company currently operates
from Bangalore, Mumbai and Hyderabad and
has a diverse portfolio that carries more than
12,000 products and over 1,000 brands. They
offer products from a wide range of categories
that includes Vegetables and Fruits, beverage,
dairy products, spices, meat, packaged foods
and personal Care products.
They have more than 40% of their sales
coming through their own brands. It operates
on a margin of 25% on other products and
over 35% for in-house labels.
BigBasket has further innovated by offering
products such as cut fruits and vegetables, a
range of recipe mixes and have recently
launched their own bakery in Bangalore tend
continuous innovation with the help of
technology (Big Basket has both android and
iOS).

Funding Raised:- Big basket had raised over

$290 million In 8 rounds from 11
investors, raising Rs. 45 crores recently in
venture debt from Trifecta Capital. Big Basket
is focused on setting up new warehouses,
strengthening the cold chain and setting up
facilities for reprocessing of Fruits &
Vegetables.
Its highest investment kept in March 2016,
consists of around $150 million dollars by
Abraaj Capital as a part of its Series D. Some
of the other investors for Big basket are
Bessemer Ventures, Helion, Zodiac and
existing investors are Ascent Capital, Lion
Rock Capital and serial entrepreneurs Ganesh
Krishnan and Meena Ganesh.
Their funds have been primarily utilised to
expand into other cities with a strong market
in 25 cities so far. Another key area of
investments made to increase new technology.
They have significantly enhanced customer
experience, both online and mobile and
enhanced the back-end processes through
increased investments in technology. By
having invested in a new technology Big
basket introduced GREEN BIGBASKET and
that is very good click in the market and it is
having a good DBMS SOFTWARE.
Investments were also made in creating
additional warehouses In different cities and
cold room facilities to significantly increase
their range of fresh produce. They have
also invested heavily into last mile delivery,
including energy efficient vehicles which are
cold chain enabled.
Value chain of Big basket:-
There are four major types of Supply Chain
models in Internet Retailing (E-Commerce in
Retail).
1.Inventory Model
2.Market place
3.Drop ship
4.Cross dock
In this 3 and 4 are in a way sub set of the
market place. Grocers work both on Inventory
model as well as market place. Instead of
explaining all in detail, the below picture
shows you clearly the difference. Even in
Inventory model, the overall product flow
from source till customer is done in 24 hours
for all the perishable products.
1.Inventory model
2. Market place Model
3.DROP SHIP MODEL
Big Basket Marketing Mix:
Product:
Big Basket is a leading Indian ecommerce
website focusing on grocery items being
delivered. The main product in its marketing
mix is its website and app, which gives access
to users to buy groceries and food online. Big
Basket offers a variety of products ranging
from grocery to dairy products, to staples to
meat products. Following are the varieties of
product categories it offers:
• Fruits & Vegetables – Fresh fruits, Fresh
Vegetables, Cut fruits, Cut Vegetables, Exotic
fruits & vegetables, Sprouts, Organic produce,
Flowers
• Food grains, Oil & masala – Dals, pulses,
Rice, Salt, Sugar, Organic Staples, Flour, Dry
fruits
• Bakery & Dairy – Bakery snacks, gourmet
breads, cakes, desserts, dairy
• Beverages – Tea & Coffee, Fruit Juices,
Energy Drinks, Soft drinks
• Branded Foods – Breakfast Cereal, Ketchup,
Pasta, Baby food etc.
• Beauty & Hygiene – Oral Care, Beauty,
Grooming, Hygiene, Fragrance, Skincare
• Household – Utensils, Storage, Stationary,
Car needs, Electricals etc.
• Gourmet – continental snacks and
confectionaries
Price:
Big Basket is a leader in the online grocery
delivery services. Big Basket is the first to
venture into this sector and has many
competitors currently. Even with all the
competition, it continues to be the market
leader and most popular amongst the
customers. It tries to increase its margins by
setting a nominal price of Rs.20 as a delivery
charge for items ordered below Rs.1000. It
also provides a nominal discount on the order
of Rs.3000 or Rs.5000 and above to encourage
households to buy their monthly groceries
from Big Basket thus providing economies of
scale. They mark up the prices of the groceries
a little higher from the market prices so as to
cover their high variable costs. High variable
costs are incurred due to wastage of perishable
items, cost of transportation, cost of labor,
transportation damage, cost of storing
inventory etc. Although there’s a markup in
the price it still tries to keep the prices
competitive with the other players in the
market.
Place:
Big Basket is spread over many parts of the
country which include cities like Bangalore,
Mumbai, Hyderabad, Pune, Chennai, Delhi-
NCR, Madurai, Coimbatore, Mysore,
Vijayawada-Guntur, Ahmedabad, and Nashik.
Big Basket will soon be expanding their
operations soon to other cities. The customers
place their orders online according to their
needs. While doing so, they choose the
delivery timings and the mode of delivery. It
provides two types of deliveries: Standard and
Express. Express delivery is done within two
hours of placing the order and Standard is
delivered on the next day. Since Big Basket
follows an inventory model, it procures its
goods from HUL, P&G and other big
manufacturers, farmers and retail stores and
stores it in the warehouse. Upon receiving the
order, the delivery personnel picks it up from
the warehouse and delivers the goods to the
said person within the chosen time.
Promotion:
Big Basket has used many marketing and
pricing strategies over the years to stay ahead
in the business. The biggest marketing strategy
they introduced was to name Shah Rukh Khan
as their brand ambassador and launch TV,
media and digital marketing campaigns which
were aimed at gaining popularity and visibility
amongst the masses, as celebrities tend to be
very influential in the Indian set up. Big
Basket provides offers periodically to its most
frequent customers, heavy shoppers and also
cash back in their digital wallets.
People:
With the scaling up of business, it has to
constantly scale up the workforce to keep up
with the operations since it is a very operation
oriented business. The business works on the
efficiency of the delivery guys who, if fail to
delivery correctly or on time, and the customer
service staff who, if fail in delivering optimal
solutions, would lead to customer complaints
and thus degrade the Big Basket brand
amongst customers.

Process:
When Big Basket started it used to follow a
Just in time model where the delivery staff
used to procure the items from the local
retailers as and when the order is received. But
with time it started to follow Inventory model.
Now, the goods are procured in advance and
stored in the warehouse. Whenever an order is
received from the customer, it does the
weighing, packaging and sends out the items
for delivery on the customer-specified timing.
The model of Big Basket is a hub and spoke
model. It has a main warehouse in the city and
many other distribution centers throughout the
city where the goods are shipped for delivery.
Currently, it has been focusing on
implementing the hyper-local strategy where it
has tie-ups with the local vendors to deliver
goods within an hour or two.

Physical Evidence:
Physical Evidence of Big Basket is seen from
the way that we get the delivery of the goods,
the quality service provided by the customer
care executives, the warehouse storage,
transportation services etc. Hence this covers
the marketing mix of Big Basket.

Repositioning of Big basket:-

The founders of BigBasket first time got
together is 1999 and started one of the first
online business in India with the name of
fabmart. As a part of fabmart they started
online grocery business as Fabmart.com.
Initially the business received a lot of online
traffic but it didn’t increase sales, as online
purchase was still a sceptical choice for
customers. Later on this business did
exceedingly well in the market and company
went to set up various physical supermarkets
in South India. Due to a lot of competition in
this field the company was not doing
exceptionally well so in 2006 FabMart was
acquired by Aditya Birla Group and renamed
the brand to More Supermarket. However, the
same team got back in 2011 and launched
BigBasket.
Team approached Mr. Shahrukh Khan and and
roped him in as brand ambassador for an
undisclosed fee. Vipul Parekh, cofounder of
BigBasket mentioned that they have selected
SRK because of his universal appeal, which
cuts across age, gender and geography, for a
mass market national brand like BigBasket,
that was very important since they appeal to
an equally wide audience.
BigBasket is now a success and it has reported
breakeven in 2014 in Bangalore. It started in
only 3 cities - Bangalore, Hyderabad and
Mumbai. After raising capital worth Rs. 600
crores through venture capitalists, it is
planning to expand its business in 10 other
cities across the country by end of 2018
(already expanded to Pune, Delhi-NCR,
Mysore, Coimbatore, Chennai and Madurai).
The reasons for its successful repositioning -
1) The first mover advantage. When Big
Basket stepped in, the online grocery space
was completely vacant.
2) The increasing internet penetration in India.
3) Its positioning as an online grocery store
and targeting people who find it extremely
mindane to go grocery shopping or does not
have the time to do so (mainly the educated
working young people or the corporates) is its
main reason for success. Most grocery items
are repeat purchases for customer who
naturally find it a tedious exercise to
physically visit stores to buy these mundane
products. This is one of the reason for its
success in Bangalore which, because of the IT
population, has the largest internet penetration
with the maximum population of corporates.
4) Past experience of the team in this field.
The founders of Big Basket had started an
online business called Fabmart which was not
a success.
SWOT ANALYSIS OF BIG BASKET:

1.Strengths in the SWOT Analysis of Big

Basket :

 Product Range: Big Basket offers a huge

range of products which stretches to about
18000 products
 Exotic Range: It also offers exotic fruits,
vegetables and imported groceries which
are not easily available in nearby retail
outlets.
 Discounts: Big Basket offers huge
discounts on various products.
 Convenience: Big Basket offers an escape
from the hassle of standing in the queues
of malls or going all the way to the retail
 stores. They give the products right at the
door step and offer multiple payment
options.
 Target Group: They have selected their
target customers very carefully and have
established a footing in the metropolitan
and some tier-I cities. They are currently
operational in about 25 cities.

2.Weakness in the SWOT Analysis of Big

Basket :

 Delivery Time: Big Basket delivers the

groceries the next day. Many retailers have
started the facility of home delivery to
nearby societies and customers in just few
minutes to hours. So customers prefer this
instead of waiting for 24 hours.
 High Variable Cost: Cost of running many
delivery guys, delivery trucks, storage for
perishable items, wastage during
 transportation makes the business run at a
high variable cost.
 Minimum order quantity/price
compulsion: Big Basket does not offer
home-delivery below a certain set order
price limit. This means that customers
would be forced to add a product or two
just to avail the service. This makes them
lose a customers.

3.Opportunities in the SWOT Analysis of Big

Basket :

 Grocery Growth: India is the 6th largest

grocery market in the world. E-commerce
grocery market is growing with a year on
year growth rate of 19%.
 Expansion: Many cities are still not
covered by these startups and Big Basket
can target them and gain the first movers
advantage.
  Market: Indian retail market is valued at
more than approx. $550 million and
grocery alone covers 60% of this share.
Hence it’s a huge market with many
players to accommodate and customers to
cater.

4.Threats in the SWOT Analysis of Big

Basket :

 Competition: It has small presence in

terms of cities covered hence, it is getting
a huge competition from other startups like
Grofers, PepperTap, Nature’s Basket, Zop
Now, Aaram Shop, Mera Grocer, etc.
 BiggerBigger Players: Players
like Amazon, Flipkart and Google have
also entered this industry. This may prove
fatal for smaller players like Big Basket to
compete with them.
  Smaller Smaller Players: Many other
localized shops have picked up on this
trend and have started home delivery
service to nearby customers thereby killing
groups of target customers across regions
and cities.

Portfolio of Big Basket Products

Fruits & Vegetables Snacks and branded
Fresh Vegetables food
Herbs & Seasonings 1. Breakfast Cereals
Fresh Fruits 2. Noodle, Pasta, Vermicelli
3. Biscuits & Cookies
Cuts & Sprouts 4. Frozen Veggies & Snacks
Exotic Fruits & Veggies5. Snacks & Namkeen
6. Spreads, Sauces, Ketchup
Organic Fruits & Vegetables
7. Ready To Cook & Eat
8. Chocolates & Candies
Flower Bouquets, Bunches
9. Indian Mithai
Foodgrains, Oil & Masala 10. Pickles & Chutney
Atta, Flours & Sooji 11. Beauty & Hygeine
Rice & Rice Products 1. Feminine Hygiene
Dals & Pulses 2. Oral Care
3. Bath, Face & Hand Wash
Salt, Sugar & Jaggery 4. Hair Care
Edible Oils & Ghee 5. 6.
Health & Medicine
Skin Care
Organic Staples 7. Mens Grooming
8. Deodorant & Fragrance
Masalas & Spices 9. Makeup

Cleaning and household

1. Detergents & Dishwash
2. All Purpose Cleaners
Bakery, Cakes & Dairy
Beverages
Water
Health Drink, Supplement
Tea
Energy & Soft Drinks
Coffee
Fruit Juices & Drinks

BEVERAGES
Dairy
Breads & Buns
Cookies, Rusk & Khari
Bakery Snacks
Gourmet Breads
Cakes & Pastries

Beverages
Water
Health Drink, Supplement
Tea
Energy & Soft Drinks
Coffee
Fruit Juices & Drinks
 Kitchen, Garden and pets

Storage & Accessories

Pet Food & Accessories
Steel Utensils
Cookware & Non Stick
Gardening
Appliances & Electricals
Kitchen Accessories
Flask & Casserole
Bakeware
Crockery & Cutler

Eggs, Meat and Fish

Eggs
Poultry
Sausages, Bacon & Salami
Mutton & Lamb
Pork & Other Meats
Fish & Seafood
Gourmet and world food
 Oils & Vinegar
Dairy & Cheese
Snacks, Dry Fruits, Nuts
Pasta, Soup & Noodles
Cooking & Baking Needs
Chocolates & Biscuits
Sauces, Spreads & Dips
Cereals & Breakfast
Tinned & Processed Food

Beverages
Baby Food & Formula
Baby Diapers & Wipes
Baby Toiletries
Mothers & Maternity

Controversies of Big Basket:-

● While you receive your packet of joy,
delivery boys return with heavy bags and
must make it to another location in the
 scorching heat. During peak summers,
delivery boys working with big MNCs are
the worst hit, given the insane number of
orders and deliveries they need to make.
 Hyderabad: A video of a dead rat in a
packet of urad daal sold at a super market
has shocked citizens in Hyderabad. The
video that has gone viral and pictures show
the decomposed, dead rat in a packet of the
cereals sold under a brand name Big
Basket.
 Ms Sumana Paramata of Madhapur
ordered 2 kg daal from online food outlet
Big Basket on August 7. The label on the
cover showed it was packed on August 4.
 The video has left many apprehensive
about opting the famous online food
supplier which was fast gripping the IT
corridor with its ease in shopping.
 The picture and video was shared so many
times that the online food supplier even
replied via a tweet apologizing about the
 inconvenience caused and about the order
details of the product.
 Under-ripe bananas: Some veggies,
especially bananas, take a week to ripen
after Big Basket delivers.
 The App: It’s quite buggy.