Zapped!!!

Question : What do you think the Fastest Retail Website for American Consumers is ?

I would’nt be surprised if your answer is Amazon. But you are worng. The correct answer is Zappos.com. The emergence of Zappos from a tiny shoe retail store to one of America’s largest online business has been one of the most startling sucess stories for online businesses. The site, which was founded in 1999 had just $1.6 million in gross sales in 2000. This has risen to $600 million in revenue in 2006.

Zappos is derived from the word Zapatos which means shoes in spanish. Apart from shoes Zappos very recently started off with selling ladies and gents handbags. A part of its revenue model also includes in running ad campaingns in the form of banners on different sites and an affiliate program where webmasters get paid for refering customers to zappos. With about 4 milllion customers the company had about 1% of the Total american population buy something from them.

Being a Web retailer only means that IT plays a huge role. Part of the reason for their business success has been because they have managed to use power of IT in a smart and efficient manner. They follow a policy which states that IT should prove useful to the business and not to the developers.

Zappos doesnt manufacture shoes but does develop its own software.The compnay has a small team of developers and has built the majority of the tools using open source software like PERL, MySQL, Linux and Apache. This includes the website , Warehouse management system , Customer service tools etc. Zappos proves to be another example of how business can succeed by employing the open source movement.

It will be interesting to keep a watch on the strategies that Zappos will employ in the coming years to reach greater heights. All the Best !

Indian Multinationals !

I know its a bit late to post this topic, but better late than never. 2006 has been a year that projected the strenght of the Indian Economy onto the Global map. The outcome has been responsible for coining of the term ‘The Indian Multinationals’. The Indian companies have been more aggressive than ever in merging or acquiring companies worldwide. Some have been quite and smooth while some had to indulge in a bloody fight with competitors. I have listed some of the top catches by top companies

Tata’s acquisition of Corus Steel now makes it the fifth biggest Steel maker in the world. The Biz critics initially wrote the deal off as stupidity but when you have somebody like Ratan Tata on your side can you loose a battle ?? The man has the ‘midas touch’. The Tatas offered a 500 pence per Corus share, thus valuing Corus at $9.2 billion. This after the acquisition of Uk based Tea company ‘Tetly’ and US based ‘Good Earth’ has given the TATA group the long awaited international exposure.

With the Thomson acquisition Videocon has emerged as one of the largest Colour Picture tube manufacturers in the world. It also has recently acquired Electrolux Kelvinator Ltd (EKL) the loss making Indian Arm of Swedish major AB Electrolux. All this was after they managed to strike a deal with the Korean debt-burdened Daewoo Electronics for $700 million (Rs 3,150 crore)

Next in the list would be the public sector gaint ONGC Ltd. It made news when it stated that it had acquired Texas-based Exxon Mobil’s stake in the Campos Basin Oil Fields in Brazil. It had acquired the full 30% stake valued at $1.5 billion. The other big buyout was along with the China’s Sinopec when it offered a $850 million to the columbian oil firm Omimex for a 50% stake.

Suzlon Energy Ltd was in news when it acquired a 100% stake in Belgium-based EVE Holding NV for Euro 465 million. With this Suzlon got hold of a neat footprint in the United Kingdom, Australia, Brazil, United States and South Africa.

The others in the news were acquisitions like Ranbaxy-Terapia, Vijay Mallya’s UB-Whyte & Mackay, Wipro-Quantech Global, Reliance/Vodafone-Hutch Essar deals that made the biz headlines.

What would be interesting is to see the strategy of the Indian companies in the coming year. Would the party continue in 2007? or will it be different.

Wait n watch !!