E-commerce Company

I: Your client is an e-commerce company facing a fall in revenue. Can you analyze why is that happening?

C: (After clarifying the problem statement) I would like to know more about the client's business and since when are we observing this decline.

I: The client mainly deals with male fashion products. They sell men's clothing and accessories all over the country. There has been a 15% decline in revenue over the past three months..

C: Alright. That implies their target customers are mainly males. Are all types of branded and unbranded products available on the site?

I: Yes, there are all kinds of products available.

C: Understood! Do our competitors also face this decline, and if this is in a specific geography?

I: No, this problem is specific to the client. We are observing this decline mainly in the southern part of India.

C: Thank you for this information. First, I would like to list all the revenue streams for our client. Revenues can generate from core business which is getting commissions for providing the marketplace. The other revenue stream can be subscriptions and advertisement. Do we have any other revenue streams?

I: No, this is comprehensive. Can you look into revenues from core business?

C: Sure! Revenues generated is a function of average price of the products, no. of units sold and % commission from the sellers. Do we know if we are experiencing decline in any of these?

I: The no. of units sold have declined over these months.

C: Okay! The number of units sold can decline due to decrease in the supply by the sellers or decrease in the demand by the customers in southern area.

I: There has been no change in the supply. What we have observed is customers orders have reduced.

C: Alright! I would like to analyze customer’s journey. Customers are first made aware of the website and products. Then they consider it for the purchase based on their preference and product quality. Then the purchase is made. Later, they can avail support in case of any discrepancies. If the experience is good, they will return for the purchase. Do we have information about no. of customers visiting our website and the conversion rate? If there is a change in these metrics over the last 3 months? .

I: The no. of customers visiting our website has remained constant, but the conversion rate has declined.

C: The issue is when they are purchasing the products on the website. I would like to deep dive into customer’s journey on the website. First, they search for the required products, once they like it, they place the order and finally they make the payment. Have we changed anything in searching algorithm which might not show the unbranded options or is there any change in the return policies for these products which might be hampering the conversion?

I: No, none of these has changed. The customers are getting dropped on the payment page.

C: Okay! As the issue is only for unbranded products and in southern region, there shouldn’t be any technical issues as the payment interface is uniform. On the payment page, the final price of the product and its components like delivery charges, taxes, discounts, etc. are displayed. Considering the change is only for southern region, is there a hype in delivery charges for that area

I: Yes, that is the issue. Our client has tied up with a new logistics partner recently for southern India. They guarantee fast delivery but at the same time has higher prices. This has led to increase in the overall price for the customers. Anything else you would like to add?

C: Yes, the customers purchasing unbranded products are more price sensitive, hence they are not making purchases due to hike in delivery charges. But the customers buying the branded products did not face this.

I: Good! We can close the case here.