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Back to Newsletter Vol 3, Issue 03, Aug 2021
Business Strategy
The case “Chime: Leading the Pack of Neobanks in the US” talks about the journey of Chime from a fintech startup to a strong challenger bank in the US. The case highlights the factors that led to Chime emerging as a leader in the neobanks landscape in the US. It starts out with a brief history of the bank and then goes on to describe Chime’s innovative products and services launched over the years which helped it to connect with millennials. The case also highlights the competitive landscape in the US digital banking industry and how Chime was facing stiff competition from others players such as Venmo, Varo, and Simple. The case ends with the challenges Chime faces in its bid to sustain its competitive position and the future plans of the bank.

Chime: Leading the Pack of Neobanks in the US
The case describes how Unilever PLC (Unilever), a multinational corporation, integrated sustainability in its business strategy and aimed to make sustainable living commonplace for billions of people globally. Unilever, of Anglo-Dutch parentage, was formed in 1930. It owned many of the world’s consumer product brands in foods, beverages, cleaning agents, and personal care products. Unilever’s products extended to over 190 countries around the world. The company brought in Paul Polman (Polman), an outsider, as its CEO consequent to a fall in market share and financial performance and its first ever profit warning in 2004. In 2010, Unilever started a new initiative called the Unilever Sustainable Living Plan (USLP) in response to a major global trends Unilever had identified –growth in emerging markets, increasing population, environmental stress, the digital revolution and changing (urbanization) demographics. Unilever also faced a backlash for environmental destruction. The Unilever SLP initiative covered not just Unilever’s greenhouse gas emissions, waste and water use – but the impact caused by its suppliers and consumers, from agricultural growers to its packaging and waste water produced by consumers of Unilever brands. In 2020, Unilever celebrated the final year of its 10-year USLP. The Unilever SLP strategy was not successful in all sectors. The company had planned to halve the waste associated with the disposal of its products by 2020, but it managed to reduce it by only 34%. The company also could not reach to its defined target regarding GHG emissions and water usage. In its endeavor to make the company sustainable and achieve all its SLP targets, the company faced many challenges. The question experts were asking was how Unilever would be able to make sustainable living commonplace for the world’s 8 billion people and continue to be the leader in sustainable business worldwide.

Unilever’s Sustainable Living Plan: Putting Sustainability at The Center of Business Strategy
After a long hiatus, the Tata Group (Tata) entered the civil aviation industry in India through a joint venture partnership with Malaysia-based Airline Group Air Asia Berhad (AAB) after Foreign Direct Investment (FDI) norms were eased in India in the year 2013. The joint venture partnership was formed under the name Air Asia India (AAI) in the year 2014. Though it was considered to be an ambitious project for both entities, AAI remained unprofitable. In 2020, with the global aviation industry heavily impacted by the Covid-19 pandemic, AAB decided to sell its stake to its partner Tata and exit the joint venture. However, for Tata, the decision to purchase a stake in AAI remained a matter of strategic choice. The present case study can be used to discuss the concepts of joint ventures, their benefits and limitations, and the reasons for the failure of joint ventures.

Tata Increases Stake in AirAsia India
The case discusses US-based sportswear giant Nike Inc.’s (Nike) response to Covid-19 or the Coronavirus pandemic. The Covid-19 outbreak that started in December 2019 in Wuhan, China, soon spread to countries across the world, and led to consumers and businesses taking precautions to prevent transmission of the disease. People were forced to stay indoors as lockdowns were imposed in many countries. This affected many industries and Nike was also badly hit. The retailer reported that 90% of the company-owned stores in the Americas, the Asia-Pacific, and Europe were closed down for eight weeks in the fourth quarter of 2020 in a bid to protect the health and safety of its workers and the consumers during the pandemic. Nike’s digital prowess helped the company tackle the crisis to a certain extent. The retailer offered the premium version of its Nike Training Club (NTC) app, which offered virtual workouts, free to consumers in China. Applying its China Playbook, Nike offered the premium version of its NTC app free to all US consumers for 90 days. The retailer also promoted a new advertising campaign ‘Play Inside, Play for the World’ encouraging consumers to stay healthy and connected at home amidst the Covid-19 pandemic. Nike’s efforts to tackle the crisis led to its reporting a 47% increase in digital revenue in fiscal 2020. However, the company had to grapple with the challenge of built-up inventory attributable to store closures during the pandemic. With these being early days of the pandemic, some analysts opined that it could be a tough road ahead for Nike as the company would have to cope with the full impact of the Covid-19 pandemic.

Nike Inc.’s Business Continuity Strategy during the Covid-19 Pandemic
GoDaddy Inc., a US-based domain registrar and web hosting company, decided in 2020 to expand beyond its core business of domain registration and web hosting. With this aim, it acquired a Cape Town, South Africa-based social content start-up Over Inc. (Over), in January 2020. Over, an app available on iOS as well as Android, had more than 1 million monthly active users ranging from large businesses, graphic designers, and entrepreneurs to bloggers, vloggers, and influencers. The app was used in more than 120 countries worldwide. Over had exclusive fonts, artwork, and other graphic enhancement tools to edit photos and videos that could be shared on social media or through emails. GoDaddy intended to integrate Over’s capabilities into its Websites + Marketing platform. It expected the move to improve user experience for small businesses and entrepreneurs who did not have much of an online presence or the technical knowhow to build an eye-catching website.

GoDaddy Acquires ‘Over’
The case, set in 2021, discusses the exit of leading global bank Citigroup from its consumer business in India. Citi’s plan to exit the consumer banking business, which it started way back in 1985 to become the largest foreign bank in India, marked the end of an era. As promoter-shareholder, Citi India played an important role in establishing important market intermediaries like depositories, Credit bureaus, clearing, and payment institutions. Citi India helped lay the foundation of the Indian software industry by establishing Citicorp Overseas Software Ltd. and iFlex Solutions Ltd.; it pioneered the ITES industry in financial services through Citigroup Global Services Ltd. Citi India’s business comprised credit cards, retail banking, home loans, and wealth management. As of 2021, Citi India was a significant foreign investor in the Indian financial market. On April 15, 2021, Citi announced that it was exiting retail banking in India and 12 other markets, citing lack of scale to compete. The exit from India was part of a restructuring plan of the bank to focus only on four wealth centers in Asia. Citi’s exit from retail banking in India was in line with the trend among foreign banks to fully or partially exit the country since 2009 as high capital and regulatory requirements in India pushed them to retreat into their domestic markets to save on costs and protect profitability. UK-based Barclays, Deutsche Bank, BNP Paribas, HSBC, and Standard Chartered had cut down their operations in India. Banking experts wondered why Citi was not able to scale up and create a profitable business in a growing market like India where many private banks had been able to successfully grow.

Citigroup’s Exit from India: Restructuring or Failure to Scale Up?
The case is about Chinese media company StarTimes Group’s (StarTimes) response strategies to the COVID-19 pandemic in Africa. Since setting foot in the African continent in 2002, StarTimes had led the continent’s transition from analog to digital services and provided digital TV services to more than 33 million users in 37 countries across the continent. The company’s success in Africa was attributed to its commitment to provide affordable and quality digital TV content to every African household. The outbreak of COVID-19 in Africa in February 2020 saw StarTimes reshaping its corporate strategy. It quickly adapted to the crisis by launching “4 Healthy initiatives” set by StarTimes’ chairman Pang Xinxing (Pang) – Healthy Environment, Healthy Mindset, Healthy Behavior, and Healthy Body. StarTimes adopted internal guidelines to minimize the risk of the virus spreading across all its offices in Africa and trained employees on how to protect themselves. In order to position itself as a trusted source of news and information about the disease, StarTimes launched a dedicated daily news update called the COVID-19 Report, broadcast in multiple languages. To help people know whether they needed medical examination, StarTimes launched the “COVID-19 Self-evaluation and Reference System” on its streaming app StarTimes ON. It also provided home schooling programs for primary and high school students throughout Africa, and launched an integrated e-commerce shopping platform called StarTimes GO to provide people with a technology-friendly shopping experience. Despite its efforts that saw its consumption grow amidst the COVID-19, StarTimes faced some challenges including rising operational costs, declining ad revenues, and a growing demand for innovative content from customers. In a bid to cope with the economic effects of COVID-19, StarTimes raised the prices of its subscription plans in August 2020, and faced a backlash from customers. Amid the uncertainties facing the African economy due to COVID-19, the challenges before Pang would be: How to broaden StarTimes’ content offerings without compromising affordability. How to best serve customers and ensure business continuity? How can StarTimes equip itself to be more resilient in an uncertain post-pandemic world?

StarTimes: The Chinese Media Enterprise’s Response to COVID-19 Crisis in Africa
The case discusses how Tesla found itself lagging behind in some key global markets as its rivals raced ahead with new affordable Electric Vehicle (EV) models. Tesla’s global market share fell to 11% in April 2021 from 29% in March 2021 as it lost ground in China, Europe, and the US where its dominance had been eroded by new competition and price hikes. In the US, Ford Motor Co.’s electric sport-utility vehicle, the Mustang Mach-E, had begun eating into Tesla’s market share, while in Europe, the world’s largest electric-car market, Volkswagen AG beat Tesla to become the top-selling all-electric vehicle maker in 2020. In China, Tesla faced intense competition as several local players flooded the EV space with affordably priced, high performance EVs. Though Tesla was a leader in the EV space with an 18% market share in the global EV market as of October 2020, it was slowly losing ground. The case highlights the key challenges faced by Tesla including growing competition, phasing out of the Federal tax credit on EVs; cash burnout due to heavy investments in technology and production facilities, launching affordable EV models, and maintaining profitability. It remains to be seen whether Tesla can maintain its lead in the global EV space or if will lose market share to rivals.

Is Tesla Losing Ground in the Global EV Market?
The case focuses on the legal aspects of mergers and acquisitions that multinational companies in India face. The scope of Foreign Direct Investment in the retail business in India is subject to several regulatory conditions. The case can be used to understand the Indian retail scenario, organized retail in the country, and the opportunities and challenges in the e-commerce retail segment in the country.

Walmart Bids Goodbye to Shelf-Scanning Robots: Ends Contract with Bossa Nova Robotics
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