Flipkart exchanges GMV for customer loyalty; markdowns of valuation by MFs irrelevant: CEO Binny Bansal

BENGALURU: GMV is out, NPS is in, and valuation markdowns mean nothing. Flipkart is giving the heave-ho to gross merchandise value, a metric which is a proxy for sales, the company’s new CEO Binny Bansal said in an interview on Monday when he also dismissed as irrelevant markdowns by some mutual funds of the valuation of the Bengaluru-based company.

Full interview: ​Flipkart will remain the largest player in online retail, says CEO Binny Bansal

Instead of obsessing about GMV, the online marketplace is embracing ‘ net promoter score’ (NPS) which Bansal is hawking as a proxy for customer loyalty, as Flipkart repositions itself under its new leader. “We have stopped giving the (GMV) range,” said Bansal, who took over from cofounder Sachin Bansal as CEO in January. “So the focus is now on input targets about the number of customers, customer experience, NPS,” he said.

The recent valuation markdowns by some mutual funds don’t mean very much, he said, likening it to beauty which is in the eye of the beholder. “It’s mostly a theoretical exercise by small investors. From our perspective, valuation is when we raise money,” he said.