KITEA (B): Getting Ready to Face IKEA

Ramon  Casadesus-Masanell; Gamze  Yucaoglu

Supplement | HBS Case Collection | March 2019

KITEA (B): Getting Ready to Face IKEA

by Ramon Casadesus-Masanell and Gamze Yucaoglu

Abstract

The case opens in September 2015, when IKEA is about to open its first store in Morocco. It then chronicles the efforts of KITEA CEO Amine Benkirane and his son Othman between 2013 and 2015 to prepare KITEA for IKEA’s entry. After incurring losses for the first time in 2013, KITEA had bounced back and recorded profits and growth in 2014 and 2015. The improvements in supply chain management, product range, and relationships with stakeholders that the duo had been working on tirelessly seemed to be paying off. After an intense preparation period, was KITEA ready to face off against IKEA in Morocco?

Keywords: retail; KITEA; IKEA; furniture; furniture industry; entry strategy; responding to entry; Localization; competitive interaction; Private Sector; For-Profit Firms; Business Strategy; Strategic Planning; Competitive Strategy; Competitive Advantage; Adaptation; Corporate Strategy; Business Model; Market Entry and Exit; Retail Industry; Morocco; Africa; North Africa;

Language: English

Format: Print

7 pages

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Citation:

Casadesus-Masanell, Ramon, and Gamze Yucaoglu. "KITEA (B): Getting Ready to Face IKEA." Harvard Business School Supplement 719-421, March 2019.

The case opens in 2013 as Amine Benkirane, founder and CEO of the leading Moroccan furniture company KITEA, contemplates the loss his company has incurred for the first time in its 20-year history. The case then describes KITEA’s origins and provides a detailed overview of the business plan that enabled Benkirane to bring affordable modern furniture in flatpacks to the Moroccan market, which had previously been dominated by unorganized artisans. At the beginning of 2010, KITEA was a market leader with a robust market share of 24%. However, Benkirane read about rumors that IKEA was planning to enter the Moroccan market. The case explores in detail KITEA’s efforts to prepare for the increased competition. In 2013, KITEA found itself in a difficult situation, facing a downturn in the economy, a slowdown in sales, a delayed store opening, and souring creditor sentiment following the news about IKEA’s entry. Would KITEA be able to bounce back and remain competitive when IKEA entered the market?

Case | HBS Case Collection | March 2019

HOPI: Turkey's Shopping Companion

Sunil Gupta, Donald Ngwe and Gamze Yucaoglu

The case opens in 2017 as Onur Erbay, CEO of HOPI, a multi-vendor loyalty platform, is contemplating a critical decision. The case chronicles the origins of Boyner Group, the parent company of HOPI and a major retailer in Turkey, and development of retail and customer relationship management (CRM) in Turkey over the years. Before HOPI, Boyner Group retailers were unable to trace customers across the Group’s brands or form insights about customers’ preferences and habits beyond what brand-specific CRM and loyalty programs provided data for. HOPI was born as the management team at Boyner Group realized the need to serve the customer holistically; the program was designed as a coalition loyalty program including non-Boyner retailer partners. The case provides a detailed overview of the design choices for HOPI—a mobile only app with its own currency, paracik, its revenue model, user experience, and how the company planned to leverage big data to segment the customers for retailers and increase purchasing power for customers. Since its launch in 2015, HOPI had 5.5 million downloads and 300 thousand daily active users browsing campaigns offered by over 116 coalition retailers that ranged from gas stations and cinemas to supermarkets and department stores. In 2017, Erbay, who had ambitions to grow HOPI beyond a loyalty program, was faced with harsh realities: the Turkish market was very price sensitive, several competitors had emerged since HOPI’s launch, and several retailers and consumers preferred discounts at the time of purchase instead of earning loyalty points for future purchases. Erbay was also facing pressure from the parent company to make HOPI profitable. Was it time for HOPI to pivot to the discount model and abandon its original concept? HOPI has provided a supplementary data set to allow for a more in-depth analysis of the program's impact on customer behavior and retailer profits. The data covers four years, two years prior to HOPI’s start and two years after, for two retailers in the coalition loyalty program. The data set includes all customers and transactions at each of the retailers, the final price paid by each customer, and whether the HOPI app was used as part of the transaction. In all, the data contains approximately 2.7 million transactions for 578,078 unique customers.

Keywords: Loyalty programs; multi-vendor platform; retail; big data; Customer Relationship Management; Mobile Technology; Business Model; Data and Data Sets; Competitive Strategy; Decision Making; Technology Industry; Retail Industry; Turkey;

Citation:

Gupta, Sunil, Donald Ngwe, and Gamze Yucaoglu. "HOPI: Turkey's Shopping Companion." Harvard Business School Case 519-057, March 2019. View Details

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