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businesses to differentiate their offerings in terms of customer preferences to establish their
market dominance.17,18
Meanwhile, Phononic’s (cooling technology provider) ‘2019 Store of the Future’ report threw
some light about the changing consumer behaviour and their expectations from the grocery
business. A large section of the population was surveyed, and it was concluded that the
grocery sector as a whole was required to leverage technology to modernise itself. The
shoppers yearned for better and faster shopping experience. In that regard, entry of Amazon
in food retail business was viewed as a decisive moment for the sector. The industry experts
felt, the presence of Amazon compelled other traditional grocers to invest to improve in-store
efficiency and customer experience. The report also stated: “Like many other industries, the
grocery business is bracing for change.....As more shopping options present themselves,
consumers are feeling more empowered. They are raising their voices to let their preferences
be known, and retailers are scrambling to serve consumers’ needs.”
Moreover, the study also highlighted that the customers were looking for robust and user-
friendly Apps which would assist them in scanning groceries during shopping process and
would allow them to pay through self-checkouts.19 The studies had also revealed that for the
sake of convenience even though some consumers were flocking to online; it was yet to pick
up scale. Stephen Caine, a Leader in Bain & Company's retail practice, explained, “Online
grocery shopping in the U.S. trails that of other e-commerce categories in large part because
our grocery shopping habits are so deeply ingrained, and online grocery retailers haven't yet
convinced customers that grocery shopping online can be a better experience.” He also added,
“Traditional grocers have decades of experience optimizing their physical stores to align with
how shoppers think — training them to navigate store shelves to easily find what they are
looking for, making it easy for them to make trade-offs between products, and providing
inspiration when they want to try something new...Online grocery shopping has not yet found
a way to digitally replicate these cues simply and intuitively.”20
Nonetheless, apart from convenience, the US customers were increasingly demanding
transparency regarding the content of their food. They were becoming much more aware
about the health and safety issues. They wanted to remain informed about the kind of food
they were eating, their exact contents, from where they were procured, their quality and
freshness etc. Thus, the grocery businesses were strategising to provide this information to the
customers, who were eager to track their food journey from ‘farm to fork’.
Industry observers also saw that the US consumers were increasingly looking for diverse palate.
Their extensive travel around the world, as well as the growing number of different ethnicities
within the country were driving the internal demand for African, Asian, and Middle Eastern food
varieties, mainly spices, flowers etc.21 On such trend, John Clevenger, Senior Vice President and
Managing Director for Acosta Strategic Advisors, ‘a leading provider of data-driven insights’ believed,
“The growing multicultural population will drastically impact the grocery industry, and we have
17 “Despite ‘Retail Apocalypse,’ U.S. Grocery Store Openings Jumped 30 Percent in 2018”, ibid.
18 Dudlicek Jim, “Experience is Crucial in the Grocery Store of the Future”,
https://progressivegrocer.com/experience-crucial-grocery-store-future, August 21st 2018
19 “Survey: Grocery stores need to ‘enter the modern age’”, op.cit.
20 Redman Russell, “Study: Convenience not a given in online grocery”, https://www.supermarketnews.com/consumer-
trends/study-convenience-not-given-online-grocery, February 11th 2019
21 Corish Zach, “Emerging Trends in the US Grocery Market 2018”,
https://www.bordbia.ie/industry/manufacturers/insight/alerts/pages/emergingtrendsintheusgrocerymarket201
8.aspx, January 26th 2018
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already noticed key differences between shopper groups…..Multicultural shoppers recognize the
link between food and their health and are significantly more likely to buy natural and organic
foods even though they are more expensive.” He therefore stressed, “Understanding these
unique values and preferences is vital for manufacturers and retailers to win with this
emerging consumer group.”22
In order to serve such diverse demand, the food retailers and supermarket chains had already
started leveraging technology. Technology had impacted the way consumers were shopping,
searching for the products they were going to buy, their method of placing the orders,
collection of goods and supplies etc. For example, people were seen using devices like Alexa, a
personal virtual assistant device developed by Amazon, to record their grocery orders and
replenish the carts. Amazon being one of the players in the grocery market was already in an
advantageous position, as it had access to customer information. To compete with that, other
players like Walmart had also made a move to re-emerge as ‘Walmart Inc.’ to emphasise its
online presence and educate the consumers about it. Experts believed that this trend would
also percolate among other players as well.23
Following the footsteps, in late-2018, Ahold Delhaize (AD), a company formed post-merger of
Ahold and Delhaize Group (in July 2016), having international headquarters in Zaandam, the
Netherlands, declared after two years of successful integration of its business, it had decided
to concentrate on strengthening its sales, earnings and market share. And, for that the
company had decided to combine technology with effective e-commerce strategies and
advance its ‘omnichannel capabilities to serve a changing U.S. customer’. At the same time, AD
emphasised on healthy and sustainable foods for which it was looking forward to build
partnership with other vendors and technology firms.24
The company had decided to build an omnichannel ‘front and back-end’, which would be
supported by Peapod Digital Labs. On this, JJ Fleeman, President of Peapod Digital Labs,
elaborated, “We are committed to innovation, leveraging our scale and providing expertise to
enable all of the brands here in the U.S. to propel their digital and e-commerce business
moving forward.”25
Not only that, AD’s ‘Retail Business Services’ (the services company of Ahold Delhaize USA26)
took help of RELEX Solutions to streamline Ahold Delhaize USA’s supply chain to deliver
‘anytime, anywhere with the freshest products’ to its local brands. Chris Lewis (Lewis),
Executive Vice President, Supply Chain for Retail Business Services, Ahold Delhaize USA,
claimed that this was a ‘game-changing solution’ for the company. While explaining how RELEX
Solutions could help AD’s business in the US market, Michael Falck, President, RELEX Solutions,
22 Redman Russell, “Multicultural consumers changing grocery shopping”,
https://www.supermarketnews.com/consumer-trends/multicultural-consumers-changing-grocery-shopping,
April 12th 2019
23 “Emerging Trends in the US Grocery Market 2018”, op.cit.
24 Springer Jon, “Muller Outlines 'Next Phase of Growth' for Ahold Delhaize”,
https://www.winsightgrocerybusiness.com/retailers/muller-outlines-next-phase-growth-ahold-delhaize,
November 14th 2018
25 Redman Russell, “Ahold Delhaize makes its move”, https://www.supermarketnews.com/retail-
financial/ahold-delhaize-makes-its-move, November 15th 2018
26 It manages supply chain operations for Ahold Delhaize USA’s local brands - Food Lion, Giant Food,
GIANT/MARTIN’S, Hannaford, Peapod and Stop & Shop.
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North America said, “Together, we share a common mission to optimize inventory levels and
ultimately improve the shopping experience for consumers, no matter how they shop.”27
Thus, such solution was expected to carry forward company’s bigger mission. On this, Kevin
Holt, CEO of Ahold Delhaize USA, explained, “We believe that customers are at the center of
everything we do. All of our brand purposes are focused around this idea that the customer is
the primary element of focus....We’re going to leverage the power of local, scale and
omnichannel. We’re committed to this, and will continue to drive for this.”28
Can Ahold Delhaize Leverage AI to Stay Relevant?
Tracing the historical development, in 2015, Ahold (Dutch grocer) acquired Belgian food
retailer, Delhaize, by paying $28 billion. Post the deal, the merged entity, ‘Ahold Delhaize’,
popularly known as AD ‘will create one of the biggest food retailers in the United States and a
major player in Europe’. Following which, the period of 2016 to 2018 was considered as an
integration period for the merged entity.29,30
According to market observers, such development was a milestone moment for the US
retail industry. Both the businesses perfectly complemented each other in the US market. Both
the companies were very active in the Eastern Coast of the US. Ahold had a considerable
presence of its stores such as ‘Giant’ and ‘Stop & Shop’ in ‘Pennsylvania, Connecticut,
Massachusetts’. In such areas, Delhaize had unnoticeable presence. But, Delhaize’s ‘Food Lion’
and ‘Hannaford’ had a dominant presence where Ahold was not having significant presence.
Therefore, the merger would cover the entire East Coast of the US.31 (Annexure I).
Meanwhile, AD’s official website revealed that the US had been ‘its biggest market segment’
which generated more than $44 billion revenue in 2018.32 According Progressive Grocer’s (the
voice of the retail food industry) data, by the year 2019, AD became the ‘fourth-largest
supermarket owner’ in the US, behind the three juggernauts, Walmart, Kroger, and
Albertsons.33 AD had its spread across 23 states, ‘serving millions of customers each week
through its more than 2,000 stores’. It had also established major dominance among the East
Coast states in the US. At the same time, the company operated through multiple store
formats, hypermarkets, local supermarkets and convenience stores etc. These stores mainly
sold wide variety of food and non-food items and some of them also included ‘on-site
pharmacies’, delicatessens and even gasoline stations.34 In US, along with its ‘central business
27 “Ahold Delhaize USA Local Brands to Leverage New Supply Chain Solution to Offer Fresher Produce to
Customers, However They Shop”,
https://www.apnews.com/Globe%20Newswire/4dc06f8ea055a6aeb59680fb34c823b6, March 27th 2019
28 “Muller Outlines 'Next Phase of Growth' for Ahold Delhaize”, op.cit.
29 Sterling Toby, Bartunek Robert-Jan, “Ahold, Delhaize in $28 billion merger focused on U.S. east coast”,
https://www.reuters.com/article/us-ahold-delhaize-group-merger/ahold-delhaize-in-28-billion-merger-focused-
on-u-s-east-coast-idUSKBN0P40GO20150624, June 24th 2015
30 “Ahold Delhaize: A Timeline of Key Events”, https://coresight.com/research/ahold-delhaize-a-timeline-of-key-
events/, November 29th 2018
31 “How a merger between Ahold and Delhaize could transform the US retail landscape”, https://www.ortec-
consulting.com/market-views/how-a-merger-between-ahold-and-delhaize-could-transform-the-us-retail-landscape/
32 “United States: All the facts about our stores in the U.S.”, https://www.aholddelhaize.com/en/brands/united-
states/our-brands-in-the-united-states/
33 Edelman Larry, “How a corner grocer ended up in the hands of a global supermarket giant”,
https://www.bostonglobe.com/business/2019/04/11/how-corner-grocer-ended-hands-global-supermarket-
giant/Nc0UjCmj93DsLZ8J4PDyZJ/story.html, April 11th 2019
34 “United States: All the facts about our stores in the U.S.”, op.cit.
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services’, AD followed ‘decentralised structure’ to focus on local markets and its online units
provided cross-brand supports.
After the successful integration of brands, in 2018, Frans Muller (Muller), President and CEO, AD,
announced, “Now is the time to take us to the next phase of growth and market share gain.” For
that AD laid out ‘Leading Together’ strategy, through which the company planned to gain its
market share through innovation and leadership for selling fresh and healthy foods. The
company hoped to reach that ambitious goal by being ‘together’ with its vendors, store teams
and other business partners.35
Meanwhile, AD declared it was aiming for ‘comparable sales growth’, ‘gain market share’ and
also looking for ‘growth in online sales’ to approximately €7 billion by the year 2021. In order
to fulfil such goals, the company decided to invest €1.8 billion for ‘Save for Our Customers’
cost program. On this, Muller mentioned, "Our commitment is to self-fund the investments
needed to drive growth, as our new cost savings program will allow us to maintain a stable
group margin through 2019. This will allow us to invest in our stores, omnichannel offering and
technology, while we explore and seize new leadership opportunities in existing and adjacent
markets."36 (Exhibit II).
Exhibit II
Ahold Delhaize: Future Targets for Business
Source: “Ahold Delhaize presents Leading Together growth strategy at Capital Markets Day in New York”,
https://www.globenewswire.com/news-release/2018/11/13/1650236/0/en/Ahold-Delhaize-presents-
Leading-Together-growth-strategy-at-Capital-Markets-Day-in-New-York.html, November 13th 2018
For its growth, AD identified five key areas. The company decided to look for ‘omnichannel growth’,
‘invest on technology’ including ‘Artificial Intelligence (AI) and Robotics’, ‘address health and
sustainability issues’, and attain ‘portfolio and scale efficiencies’ and also take on board ‘best
talents’.37 (Exhibit III).
35 Springer Jon, “Muller Outlines 'Next Phase of Growth' for Ahold Delhaize”, op.cit.
36 “Ahold Delhaize presents Leading Together growth strategy at Capital Markets Day in New York”,
https://www.globenewswire.com/news-release/2018/11/13/1650236/0/en/Ahold-Delhaize-presents-Leading-
Together-growth-strategy-at-Capital-Markets-Day-in-New-York.html, November 13th 2018
37 “Ahold Delhaize Capital Markets Day 2018”, https://www.aholddelhaize.com/media/8252/leading-
together.pdf
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Exhibit III
Ahold Delhaize: Business Philosophy
Source: “Ahold Delhaize: Full year results 2018”, https://results.aholddelhaize.com/
At the same time, AD planned to win the customers by serving them fresh varieties of food.38
According to the company’s annual report, “As a food retailer, Ahold Delhaize is positioned in
the middle of the value chain, delivering products from farmers and suppliers to consumers
through our retail stores and online operations”. (Exhibit IV). AD was efficiently procuring
products from the suppliers and also directly from the farmers and sold these products through its
retail and online stores directly to the customers. AD was looking forward to vertically integrate
different stakeholders of its value chain. For example, through backward integration, it planned to
integrate its business with other food farms and processing plants. This would guarantee supply of
quality products and also ensured lower costs. And, as a part of its forward integration plan, it had
established ‘direct-to-consumer sales models’ for consumer-packaged goods.39 Because of its sheer
size and scale of operations, the business had enough power to play a catalytic role to influence the
overall value chain and make it more sustainable.40
In a major development, in order to serve its customers better through all its grocery services, AD
decided to leverage AI for better management of inventories. The company aimed to use AI to
efficiently manage ‘end-to-end forecasting’ and also in replenishing the ‘fresh and non-perishable
items’. Through such initiative, AD believed, this would help to synchronise the ‘stores and
distribution centres’, and helping them to ‘cut down on piling stock’. Thereby such technological
intervention could eventually drastically reduce the cost, especially the shipment cost of perishable
food, like fish and pork. On such development, Lewis, opined, “[This will enable] complete supply
chain transformation at a time when customer expectations are rapidly changing the way groceries
are bought, sold, and delivered.”41
38 “Ahold Delhaize USA Local Brands to Leverage New Supply Chain Solution to Offer Fresher Produce to
Customers, However They Shop”, op.cit.
39 “Ahold Delhaize: Leading Together Annual Report 2018”, https://results.aholddelhaize.com/media/1113/ahold-
delhaize-annual-report-2018.pdf
40 “Ahold Delhaize: Full year results 2018”, https://results.aholddelhaize.com/
41 Reints Renae, “Peapod, Stop & Shop Promise Fresher Product With New AI Inventory System”,
http://fortune.com/2019/03/27/grocery-services-ai-technology/, March 27th 2019
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Exhibit IV
Ahold Delhaize’s Value Chain
Source: “Ahold Delhaize: Leading together Annual Report 2018”,
https://results.aholddelhaize.com/media/1113/ahold-delhaize-annual-report-2018.pdf
Thus, in order to improve the supply chain efficiency, Retail Business Services launched an
Integrated Transportation Management (ITM) system. This system helped to establish seamless
supply chain connection among Ahold Delhaize USA’s brands such as Stop & Shop, Giant Food,
Food Lion, GIANT/MARTIN'S, Hannaford, and Peapod etc. Such system helped the company to
successfully integrate its business, provide better visibility across the supply chains which would help
to identify the pinch points along the supply line, thus, to ensure its efficiency. (Exhibit V).
Exhibit V
Functions of Integrated Transportation Management (ITM) System
Integration:
- Integrates a transportation management system, yard management system and on
board truck computers.
Visibility:
- Uses geo fencing capabilities and push alerts to track transportation fleets’ location and
projected arrival time.
- Increases visibility to transportation performance as fleet movement can be tracked
and traced throughout the process.
- Helps identify factors that lead to or cause delays, such as traffic or unloading time.
Efficiency:
- Integrates the planning and execution of inbound and outbound transportation plans.
- Ensures continuous movement with increased time performance, while reducing the
number of empty miles driven.
- Increases revenue generation and improves cube space utilization of trucks.
- Ensures product transportation at maximum efficiency.
Source: Compiled by the author from, “Logistics Innovates, Improves Transportation Operations for Ahold
Delhaize USA Brands”, https://www.retailbusinessservices.com/news-releases/news-release-
details/logistics-innovates-improves-transportation-operations-ahold,
November 27th 2018
To cater to its customers with best variety of produce from the local brands, Ahold Delhaize
USA was reported to have annually employed more than 1,000 trucks which had been
travelling more than 100 million miles annually. On such aspects, Tim Rohrbaugh, Vice
President, Logistics, Retail Business Services elaborated, “We take pride in our ability to
support local brands in efficiently moving groceries through their supply chains so they can
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provide fresh, healthy food for their customers. Having a comprehensive, end-to-end
Integrated Transportation System in place is integral to making that happen. The new system
gives us the insights we need to ensure that routes are optimized, fleets are efficient and
consumers are able to purchase fresh products whenever they want them.”42
To offer ‘hyper personalised’ shopping experience to online and in-store customers, AD chose
‘Microsoft AI technology’. At the same time, the company planned to evolve its business model
using Microsoft Azure, which helped the business to harness the power of cloud and big data
for data-driven decision-making. The data availability in cloud offered better synergies
between various data users across verticals and helped in optimising the internal processes
and ultimately better serving the customers with right price, product, and promotion through
proper channels.
On this, Mike Blay (Blay), Vice President of IT Development of Ahold Delhaize, illustrated, “Our
primary goal is to focus on the customer agenda and provide a best-in-class experience, from
when they shop online to entering a store. We want to be useful and help our customers save
time and money.” For that, AD had planned to introduce new concepts like ‘frictionless
shopping’ called ‘Tap to go’, ‘Predict My List’ etc. to facilitate hyper-personalised shopping
experience. Not only that, integrating customers’ shopping data with supply chain information
and in-store details, the company managed its stock and carry out in-store replenishment
much more efficiently. Blay further explained, “We’re using real time data flows with specific
store layout information to deliver new experiences...”
Not only that, the business was ready to explore the possibilities of running a data driven
business, powered by cloud and AI. And this was expected to transform the rules of grocery
business in near future.43 For example, AD wanted to leverage AI to overcome other business
challenges like responding more efficiently to local weather conditions, making assortment
more accessible to customers, warehouses maintenance, ensuring last mile logistics etc. The
business got ready to share the insights and knowledge across its businesses in various
locations across various countries.44,45
As the customers were seriously looking for the exact information regarding the origin of the
food they were eating, AD decided to use blockchain for products like ‘orange juice,
pineapples, and fish’. On such focus, Muller believed, “It can help us be a good retailer and
differentiate us from the rest and answer those consumer questions.” He further added,
“Retailers need to be able to answer questions when customers want to be reassured that
products have been properly harvested or know the farmer has a good standard of life. “46
Not only that, AD aimed to offer better shopping experience to both online and offline
customers. The company had realised that the consumers were seeking for convenience and
for that they were ordering their groceries online and getting their food delivered right at their
42 “Logistics Innovates, Improves Transportation Operations for Ahold Delhaize USA Brands”,
https://www.retailbusinessservices.com/news-releases/news-release-details/logistics-innovates-improves-
transportation-operations-ahold, November 27th 2018
43 “The power of prediction: how Ahold Delhaize is using data and AI to provide more personalised shopping
experiences”, https://customers.microsoft.com/en-au/story/aholddelhaize-retail-azure-cloud-datalake-
cosmosdb-netherlands, October 27th 2018
44 “Ahold Delhaize Invests in Artificial Intelligence Research”,
https://www.theshelbyreport.com/2018/05/07/artificial-intelligence-investment-ahold-delhaize/, May 7th 2018
45 Lhomme Debbie, “Ahold Delhaize expands into robotics”,
https://www.retaildetail.eu/en/news/general/ahold-delhaize-expands-robotics, November 12th 2018
46 Baldwin Caroline, “Shoptalk19: Retailers need to help customers understand AI and data, says Ahold Delhaize
CEO”, https://www.essentialretail.com/news/shoptalk19-understand-ai-data/, March 5th 2019
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door steps. At the same time, others were preferring in-store pickups. But there were still
large number buyers who preferred to walk through the aisles and physically pick and choose
their food baskets. For them, AD had introduced Marty, ‘a friendly autonomous robot’ who
was assigned to keep the aisles clean and safe for these customers.47 To execute its plan and
explore further possibilities of applying ‘robotic solutions’ further across the supply chain, AD
had collaborated with Delft University of Technology in the Netherlands. Robotics were
believed to be particularly helpful in managing the ‘repetitive tasks’, ‘handling delicate
produces’ such as fruit and vegetables etc., to ‘manage the replenishment of store shelves’,
‘guiding and assisting the customers during shopping’ etc.48
Meanwhile, according to experts, AD identified technology as one of its key facilitators for
growth. But to unleash the full potential, the company took additional initiative to educate its
customers. And that remained one of the major challenges for AD. On this, Muller explained,
“There’s a true concern that if we can’t take people with us and understand what we have in
mind and the benefits of technology, we have a problem.” In order to deal with such challenge,
AD had decided to train people on AI and help them have a better understanding about the
risk and potential gain.
As the customers were increasingly sceptical about sharing their personal information, about
food safety issues etc., AD believed it had to share its ethical business values with its
customers. AD also believed that its business ought to be more transparent to assure e
customers about the legitimate usage of customers’ personal information. On this, Muller
assured, “We will only use customer data if there is a benefit for customers – we have to be
very transparent. And with facial recognition legislation coming up, data protection will be a
big topic, not only about giving consent on the internet, but when customers come into stores
and have their picture taken, there will be the same data protection rights.” Thus, it remained
to be seen how AD would be able to convince its customers to derive the true potential of AI to
drive its business growth in coming period.49
Annexure I
Various Brands of AD
Source: “Ahold Delhaize Capital Markets Day 2018”,
https://www.aholddelhaize.com/media/8252/leading-together.pdf
47 “Peapod, Stop & Shop Promise Fresher Product with New AI Inventory System”, op.cit.
48 “Ahold Delhaize expands into robotics”, op.cit.
49 “Shoptalk19: Retailers need to help customers understand AI and data, says Ahold Delhaize CEO”, op.cit.
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1st Edition, Issue-1 Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
Rakuten’s ‘Cashless Stadium’ Initiative
Will It Pay Off?
Case Study
This case was written by Subhankar Dutta and reviewed by Dr. A. Saravanan Naidu, Amity
Research Centers Headquarter, Bangalore. It is intended to be used as the basis for class
discussion rather than to illustrate either effective or ineffective handling of a management
situation. The case was compiled from published sources.
© 2019, Amity Research Centers Headquarter, Bangalore.
Website: www.amity.edu/casestudies/
No part of this publication may be copied, stored, transmitted, reproduced or distributed in
any form or medium whatsoever without the permission of the copyright owner.
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1st Edition, Issue-1 Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
Author: Subhankar Dutta
Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
Abstract: Rakuten, Inc. (Rakuten), one of the leading e-commerce companies in Japan, had
established its sheer commercial presence in the country by offering a host of service facilities
like ‘Rakuten kobo’, ‘Rakuten Marketing’, ‘Rakuten OverDrive’, ‘Rakuten slice’, ‘Rakuten Viber’,
‘Rakuten TV’, ‘Rakuten VIKI’, ‘EBATES – A Rakuten Company’, etc. The company had followed a
varied, dynamic and open corporate culture in its various commercial functions. In order to
make a proper and stress-free sports viewing experience, Rakuten had taken an exclusive
initiative to offer ‘cashless stadium’ scheme. In this regard, in 2019, Rakuten had officially
declared that ‘Tohoku Rakuten Golden Eagles’, the professional baseball team, and ‘Vissel
Kobe’, J1 League professional football team, would introduce completely cashless payment
systems under the ‘smart stadium concept’. Under this unique strategic program, the payment
for match tickets, merchandise products and other items available at the stadiums, would be
made by the Rakuten Pay smartphone payment app, Rakuten Edy e-money, Rakuten Point
Card, Rakuten Card, Rakuten Bank Debit Card (JCB/Visa), etc. Market experts claimed that the
company might lead the path with its cashless program based on commerce and fintech
service facilities and motivate other type of sporting teams to follow the similar strategy. In
this context, would Rakuten’s ‘cashless stadium’ initiative succeed in the long run?
Case Study
“Global Innovation Company: Empowering people to realize their dreams.”1
– Hiroshi Mikitani, Chairman and CEO of Rakuten, Inc.
Headquartered in Tokyo, Japan, Rakuten, Inc. (Rakuten) was considered as one of the
premium e-commerce companies in the country. The company had become very popular
among the customers mainly by offering several services, including ‘Rakuten Marketing’,
‘Rakuten Viber’, ‘Rakuten slice’, ‘Rakuten kobo’, ‘Rakuten TV’, ‘Rakuten VIKI’, ‘Rakuten’,
‘EBATES – A Rakuten Company’ and ‘Rakuten OverDrive’.
From a commercial point of view, the management of Rakuten had pursued a varied, dynamic
and open corporate culture in its different business operations. Various innovative business
strategies such as the introduction of the Rakuten Ichiba internet shopping mall, Rakuten
Points and the growth of FinTech had mainly driven the company’s commercial progress to a
considerable amount since 1997. Besides that, the management of Rakuten had taken its mid-
term strategy ‘Vision 2020’ that could provide insights for strengthening its long-term
commercial performance mainly by assessing each business unit against three growth-oriented
principles, i.e., ‘Strong Businesses’, ‘Smart Businesses’ and ‘Speed Businesses’. During 2014,
1 “About Us – Rakuten, Inc.”, https://global.rakuten.com/corp/about/
“© 2019, Amity Research Centers HQ, Bangalore. All rights reserved.”
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1st Edition, Issue-1 Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
Rakuten’s management had taken a decision to adopt ‘English’ instead of ‘Japanese’ as the
company’s formal reporting language mainly for attaining worldwide business growth.
Furthermore, according to the report published by Nikkei Asian Review, Rakuten’s commercial
strategy was diverse from its chief business competitor Amazon. Besides, Rakuten had
promoted its brand value through collaborating with premium professional sports clubs
worldwide. For instance, Rakuten had become FC Barcelona’s ‘Main Global Partner’ and it’s
first-ever ‘Global Innovation and Entertainment Partner’ from 2017–18 to 2020–21 seasons.
In an attempt to make an appropriate and stress-free sports viewing experience, Rakuten had
adopted a unique initiative to provide ‘cashless stadium’. During 2019, Rakuten’s management
had formally announced that ‘Tohoku Rakuten Golden Eagles’, the professional baseball team,
and ‘Vissel Kobe’, J1 League professional football team, would launch entirely cashless
payment schemes under the ‘smart stadium concept’. Under this initiative, the payment for
match tickets, merchandise items and other products available at the stadiums, would be
made by the Rakuten Pay smartphone payment app, Rakuten Edy e-money, Rakuten Card,
Rakuten Point Card and other Mastercard, American Express, Visa and JCB-branded credit
cards, Rakuten Bank Debit Card (JCB/Visa) and other premium debit cards. By adopting such
system, the company had wanted to offer cashless service facilities to the spectators.
Moreover, market experts had claimed that Rakuten could lead the path with its cashless
initiative based on commerce and fintech services to inspire other type of sporting teams in
choosing similar strategy. For example, during 2019, Major League Baseball’s Tampa Bay Rays
had formally announced to provide a cashless initiative at their home ground stadium
Tropicana Field. Apart from sporting teams, premium companies such as Apple and Starbucks
had confirmed that a large number of customers in the US were feeling comfortable at
cashless payment systems. In this connection, it was remained to be seen whether Rakuten’s
‘cashless stadium’ strategy would pay off in the days to come.
Rakuten: The Emergence and Growth
Rakuten was recognised as one of the major e-commerce companies in Japan.2 It was founded
by Hiroshi Mikitani (Mikitani) on February 7th 1997. The company had its headquarter in Tokyo,
Japan.3 In Japanese language, ‘Rakuten’ stood for ‘optimism’. It further had a meaning that
stated, “We believe in the future.” After inception, Rakuten had gradually established its
businesses in various sectors, including e-commerce, digital content, Fintech and
communications. As of April 2019, Rakuten had spread out its commercial services in 30
countries, and to approximately 1.3 billion members. The major services that Rakuten had
provided worldwide were ‘Rakuten Viber’, ‘Rakuten Marketing’, ‘Rakuten slice’, ‘Rakuten
kobo’, ‘Rakuten TV’, ‘Rakuten VIKI’, ‘Rakuten OverDrive’, ‘Rakuten’ and ‘EBATES – A Rakuten
Company’.4
Rakuten’s management had decided to adopt ‘English’ in place of ‘Japanese’ as the company’s
official reporting language as a part of its global business growth initiative in 2014. Speaking on
this occasion, Mikitani stated that in recent times, Rakuten’s switch to take up English in place
of Japanese as the company’s formal reporting language had played a major role in its
international growth. The shift in language had benefitted the company to establish its
presence in several nations. As a result, it had contributed to achieve strong global sales of the
2 Wee Willis, “The History of Rakuten, Japan’s Largest E-Commerce Site [INFOGRAPHIC]”,
https://www.techinasia.com/rakuten-infographic, June 13th 2011
3 “Rakuten, Inc.”, https://asia.nikkei.com/Companies/Rakuten-Inc
4 “About Us – Rakuten, Inc.”, op.cit.
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company. Highlighting on this issue, Mikitani, therefore, emphasised on the power of
“Englishization” for the growth of the company’s sales globally. As he commented, “Today’s
good result is coming from our organizational strengths. But mainly (strong growth) is coming
from the fact that we changed company language. That was a very dynamic move.”5
Besides, Rakuten had followed a diverse, dynamic and open corporate culture in its business
operations. Moreover, the culture had actually promoted the exchange of diverse ideas, which
had ultimately distinguished Rakuten from its business rivals. The company’s labour force was
made up with skilled employees from over 70 countries and regions.6 In 2016, the
management of Rakuten had initiated a new corporate vision to become a ‘Global Innovation
Company’. Apart from that, the company had adopted its business mission, i.e., contribution to
the society through creating value by innovation and entrepreneurship.
Several innovative commercial strategies like the introduction of Rakuten Points, the Rakuten
Ichiba internet shopping mall, and the progress of FinTech had particularly driven the
company’s business growth to a substantial volume since 1997. In 2016, the global gross
transaction value of Rakuten had registered around ¥10.7 trillion.7 (Exhibit I).
Exhibit I
The Business Growth Trend of Rakuten during 2000-2016
Source: “Rakuten – Annual Report”,
https://global.rakuten.com/corp/investors/assets/doc/documents/Rakuten_16AR_all.pdf, December
31st 2016
In addition to that, the management of Rakuten had adopted its mid-term strategy ‘Vision
2020’ that might offer insights for intensifying its long-term business performance especially
through assessing each commercial unit against three growth-oriented philosophies, namely,
5 “How Rakuten’s Strategy Differs from Amazon”, https://www.pymnts.com/news/2014/how-rakutens-strategy-
differs-from-amazon/, November 6th 2014
6 “About Us – Rakuten, Inc.”, op.cit.
7 “Rakuten – Annual Report”,
https://global.rakuten.com/corp/investors/assets/doc/documents/Rakuten_16AR_all.pdf, December 31st 2016
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‘Strong Businesses’, ‘Smart Businesses’ and ‘Speed Businesses’.8 (Exhibit II). In this context,
Mikitani commented, “With this vision, we are planning on growing rapidly. By 2020, we are
looking to achieve 1700 billion yen in annual revenue (or approximately US$15 billion at
today’s exchange rates). We also plan to achieve operating income (non-GAAP) of 300 billion
yen (US$2.7 billion) by 2020, and EBITDA of 360 billion yen (US$3.2 billion).”9
Exhibit II
‘Vision 2020’ Strategy of Rakuten
Source: “Rakuten – Annual Report”,
https://global.rakuten.com/corp/investors/assets/doc/documents/Rakuten_16AR_all.pdf, December
31st 2016
Besides that, as per the company’s annual report of 2016, Rakuten’s e-commerce business had
substantially grown in Japan and foreign markets during 2012-16. In this connection, the report
had highlighted that the domestic e-commerce ‘Gross Merchandise Sales’ (GMS) growth had
increased in 2016. Further, the company had conducted programs to increase customer
satisfaction, intensifying service facilities for smart devices and initiating the Rakuten
ecosystem mainly for increasing the company’s long term and loyal customer base. GMS in
Japan had increased 12% year on year to ¥3 trillion, particularly due to the long-lasting
popularity and impact of the Super Point Up (SPU) initiative, which had encouraged the users
to stay within the Rakuten system.10 (Exhibit III).
8 “Rakuten – Annual Report”, op.cit.
9 “Vision 2020: Rakuten”, https://rakuten.today/mickeysvoice/vision2020.html, March 2nd 2016
10 “Rakuten – Annual Report”, op.cit.
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Exhibit III
Rakuten’s Domestic E-commerce ‘Gross Merchandise Sales’ (Trillions of Yen)
Source: “Rakuten – Annual Report”,
https://global.rakuten.com/corp/investors/assets/doc/documents/Rakuten_16AR_all.pdf, December
31st 2016
Globally, Ebates had substantially contributed towards the growth of Rakuten’s business.
During 2016, Rakuten Marketing had won the ‘Blue Book Award’ as the ‘Best Affiliate Network’
for the fifth consecutive year in a stretch. In the same year, Ebates’ GMS had increased by
32.7% year on year (y-o-y) to $6.5 billion (Exhibit IV). In Europe, Rakuten had made notable
commercial gains in Germany, where Rakuten.de had raised its GMS by 103% y-o-y, and in
France, PriceMinister had quickly increased its ‘Price Club’ membership. In addition to that,
Rakuten had spread out its business activity in the Asian market as well. As a result, Rakuten
had partnered with South Korean e-commerce websites 11Street and Gmarket. Furthermore,
Rakuten had introduced the Rakuma mobile C2C service facilities in Taiwan and simultaneously
it had collaborated with premium Chinese e-commerce website Kaola.com.11
Exhibit IV
Rakuten’s Ebates’ Gross Merchandise Sales (Billions of U.S. dollars)
Source: “Rakuten – Annual Report”,
https://global.rakuten.com/corp/investors/assets/doc/documents/Rakuten_16AR_all.pdf, December
31st 2016
11 “Rakuten – Annual Report”, op.cit.
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Besides, as per the report published by Nikkei Asian Review, Rakuten’s business strategy was
different from its major commercial rival Amazon. In this context, the report had stated,
“Amazon’s strategy is to aggressively invest in logistics facilities and develop mobile devices to
build its own online shopping infrastructure, even if that hurts profits now. Rakuten, on the
other hand, is pursuing growth by curbing investment through use of existing infrastructure.” It
had further added, “Many overseas markets that the two companies will fight over in the
future do not yet have sufficient e-commerce infrastructure, and there are uncertainties over
whether Rakuten’s asset-light business model will be effective. Rakuten is pressing ahead with
integrating online shopping with services that do not require heavy investment, such as
Internet finance, video and advertisements.”12
Apart from that, Rakuten’s management had initiated to engage in its brand strengthening and
extending activities, such as taking up ownership and collaborating approaches with
professional sports clubs. In this context, industry experts highlighted that Rakuten had
become FC Barcelona’s ‘Main Global Partner’ and it’s first-ever ‘Global Innovation and
Entertainment Partner’ from 2017–18 to 2020–21 seasons (Exhibit V). By partnering with FC
Barcelona, Rakuten’s official logo would appear on match-day jerseys of the club. Such joint
venture initiative might bring together the collective power of Rakuten’s brands, including
Viber, Ebates, Kobo, PriceMinister and Wuaki to create an innovation-oriented strategic
framework, which could deliver unique service facilities to supporters, members and players.
Besides, Viber would focus on serving as FC Barcelona’s official communications channel.13
Exhibit V
Rakuten’s Partnership Initiative with FC Barcelona
President of FC Barcelona, Josep Maria Bartomeu and H. Mikitani, Chairman and
CEO, Rakuten, Inc.
Source: “Rakuten to Become FC Barcelona Main Global Partner”,
https://rakuten.today/mickeysvoice/rakuten-fc-barcelona-global-partner.html, November 16th 2016
12 “How Rakuten’s Strategy Differs from Amazon”, op.cit.
13 “Rakuten – Annual Report”, op.cit.
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While speaking about this important collaboration between Rakuten and FC Barcelona at a
press conference on November 16th 2016, Mikitani declared, “Today I am thrilled to announce
that we have entered into a partnership with one of the world’s most iconic and esteemed
football clubs: FC Barcelona. Commencing from the 2017-2018 season, Rakuten will become FC
Barcelona’s Main Global Partner and its first-ever Global Innovation and Entertainment
Partner. With the Rakuten logo appearing on FC Barcelona match-day jerseys, we will power
our global brand strategy. We will also bring together the collective power of our brands, like
Viber, Wuaki, Ebates, Kobo and PriceMinister, and draw on their technological expertise across
messaging, drones, e-commerce, AI and more to build an innovation framework that will
deliver unique services to fans, members and players. Viber will also become FC Barcelona’s
Official Communications Channel.” He further added, “We have decided to take this great
opportunity not only because FC Barcelona is the strongest club in the world but, more than
that, we feel its philosophy really resonates with what we, Rakuten, have been pursuing for
the last twenty years.”14
Rakuten’s ‘Cashless Stadium’ – A Successful Initiative in the Offing?
In order to make a suitable and stress-free sports viewing experience, Rakuten had initiated to
offer ‘cashless stadium’ concept. In 2019, Rakuten had officially declared that basketball team
‘Tohoku Rakuten Golden Eagles’ (Eagles) and football team ‘Vissel Kobe’ (Kobe) would
introduce fully cashless payment systems under the ‘smart stadium concept’. Both these
teams would focus on commencing the cashless payment systems at their respective home
ground stadiums of Rakuten Seimei Park Miyagi and Noevir Stadium Kobe from the opening
games of the 2019 season.
Under this unique initiative, the payment for match tickets, merchandise products and other
goods available at the stadiums, would be made by the Rakuten Edy e-money, Rakuten Pay
smartphone payment app, Rakuten Card, Rakuten Point Card and other Mastercard, Visa and
JCB-branded credit cards, American Express, Rakuten Bank Debit Card (JCB/Visa) and other
branded debit cards (Annexure I). Through taking up such scheme, the company had wanted to
provide cashless facilities to the visitors who would come for watching matches in the stadiums.
Further, by using all of these cashless methods the visitors might receive the ‘Rakuten Super
Points’. Also, it could make the purchase simpler for the spectators as no time would be
wasted in search for or managing with small changes. Hence, both the stadiums had taken a
decision to pursue completely cashless facilities for making it easier for supporters of the
Eagles and Kobe for experiencing the convenience and benefits of these cashless payment
systems.
In this context, industry experts revealed that Japan frequently stood out among other
developed nations for its low proportion of cashless payment facilities. By making
opportunities for supporters to experience cashless payment systems at the sporting venues,
Rakuten’s management had aspired for not only minimising the stress related issues to make
payments for supporters, but also to encourage the implementation of cashless payment
systems across Japan.15
14 “Rakuten to Become FC Barcelona Main Global Partner”, https://rakuten.today/mickeysvoice/rakuten-fc-
barcelona-global-partner.html, November 16th 2016
15 Dhyani Kunal, “Japan’s e-commerce brand Rakuten ready with first ever ‘cashless stadium’”,
https://www.insidesport.co/japans-e-commerce-brand-rakuten-ready-with-first-ever-cashless-stadium/, January
17th 2019
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By initiating such unique service, Rakuten’s management had aimed on to save the time mainly
through eradicating the requirement for both vendors and customers to look for change during
the time of making any transaction. Also, the company had provided cards to all the visitors,
which might be charged for making digital purchases.
Apart from that, the transformation into the online platform had benefited both the teams
immensely. According to experts, one of the most important advantages that the teams could
enjoy was to get access of the customer’s purchasing data. In this regard, Rakuten had officially
stated that the team Eagles had become the first professional baseball team in the globe to
make all of its on-site products purchase online.16
In this background, Eagles had revealed a plan to make its domestic match stadium entirely
cashless in functional during 2019 season. Hence, on its website, the team had formally
unveiled, “The cashless movement has been going forward around the world, and there are
countries where cashless payments are used more than cash.” While having the success with
its QR code service facility, ‘Rakuten Pay’, the Eagles had taken a decision to entirely go for
cashless provision at their stadium. The supporters would be able to buy match tickets, food
and products with ‘Rakuten Pay’ that permitted for payment through smartphones, credit
cards and ‘Rakuten Edy’, a prepaid smart card. Besides that, the club management had offered
some types of support facilities for children and to those without any cashless payment
choices. Moreover, the club had planned to introduce promotions and discounts to the
customers based on their cashless purchases. Experts claimed that if this initiative got
successful, it might put Eagles the front runner of the cashless movement that the Japanese
government was trying to promote among the people.17
Further, the industry experts highlighted that a large number of Japanese people had the habit
of using cash for transactions. In contrast, only approximately, one in five payments were
transacted through online medium in Japan, a ratio which lagged behind the US, Europe and
China. In an effort to encourage shop-keepers to discard their paper bills and coins, the
Japanese government had recommended to ‘go digital’.18
As per the Forex Bonuses study published in The Telegraph, a London-based newspaper,
during October 2017, Japan was positioned ninth among the global top 20 economies in terms
of adopting the cashless facilities in the country. In March 2017, the Ministry of Economy,
Trade and Industry had introduced its ‘Cashless Vision’ that initiated encouraging the merits of
going cashless system to the Japanese masses.
Further, as per the report of Journalist Kazuaki Nagata in The Telegraph during December
2018, Japan had wanted to raise cashless payments to 40% within 2027 that could double the
amount as compared to the value recorded in 2016.19
Speaking on this issue, Midori Ezoe, Head of the Project Management, Rakuten, stated,
“Rakuten as a company should play a role in promoting a cashless society in Japan. We hope by
16 “Rakuten pro baseball team goes cashless at stadium”,
https://www3.nhk.or.jp/nhkworld/en/news/20190403_34/, April 3rd 2019
17 Coskrey Jason, “Eagles announce plans to make Rakuten Seimei Park Miyagi world's first cashless stadium”,
https://www.japantimes.co.jp/sports/2019/01/12/baseball/japanese-baseball/eagles-announce-plans-make-
rakuten-seimei-park-miyagi-worlds-first-cashless-stadium/#.XLmL7zAzYdU, January 12th 2019
18 “Rakuten pro baseball team goes cashless at stadium”, op.cit.
19 “Eagles announce plans to make Rakuten Seimei Park Miyagi world's first cashless stadium”, op.cit.
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1st Edition, Issue-1 Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
providing a new way to enjoy sports in a stress-free environment we can make people more
comfortable with non-cash payments”.20
Above all, Rakuten might lead the way with its cashless initiative based on commerce and
fintech service facilities to motivate other type of sporting teams for pursuing the same
strategy. In tune with the fact, experts highlighted that in 2019, Major League Baseball’s
Tampa Bay Rays (Rays) had officially declared to offer a cashless initiative at their home ground
stadium Tropicana Field.21 On February 9th 2019, Rays had formally become the first cashless
pro-sports stadium in North America mainly through tech-enhanced transaction system at a
free-admission supporter event. Speaking on this occasion, William Walsh, Vice President of
Strategy and Development of Rays, stated, “We have made significant investments each year
to improve the ballpark experience for fans, including an overhaul of our approach to food and
beverage since the beginning of our partnership with Levy. This change will increase speed of
service and reduce lines throughout the ballpark.”22
In addition to sporting teams, major companies like Apple and Starbucks had confirmed that a
large number of US customers were feeling comfortable at cashless payment facilities.23 In this
connection, eMarketer Data had revealed that Starbucks had remained the most popular
mobile payment app as it had a leading market share over Apple Pay, Google Pay and Samsung
Pay. During 2018, approximately 23.4 million people aged 14 and over had utilised the
Starbucks app in order to make a point-of-sale purchase. The eMarketer Data had further
highlighted that Starbucks was anticipated to maintain its lead in mobile payments through
2022.24
Apart from that, the Rakuten Group had emphasised on continuing the promotion of the
cashless payment systems, focusing on improving the service facilities and increasing the
number of locations where they could use, in order to provide a convenient payment
experience to a large number of people.25 On the other hand, according to the experts at
TheStadiumBusiness,26 “One of the key issues for cashless payment providers is to educate the
masses – and one concern that is often raised in the context of the technology is security.”27 In
this background, would Rakuten’s ‘cashless stadium’ strategy become a successful
phenomenon in the coming days?
20 “Rakuten pro baseball team goes cashless at stadium”, op.cit.
21 “Rakuten Redefines A Day At The Ball Park With Cashless Stadiums”, https://rakuten.today/blog/rakuten-
cashless-stadiums.html, March 6th 2019
22 Barrabi Thomas, “MLB's Tropicana Field becomes first cashless stadium in North America”,
https://www.foxbusiness.com/technology/mlbs-tropicana-field-becomes-first-cashless-stadium-in-north-
america, February 10th 2019
23 “Rakuten Redefines A Day At The Ball Park With Cashless Stadiums”, op.cit.
24 Dignan Larry, “Why Starbucks remains the mobile payment app leader ahead of Apple, Google, Samsung”,
https://www.zdnet.com/article/why-starbucks-remains-the-mobile-payment-app-leader-ahead-of-apple-google-
samsung/, May 22nd 2018
25 “Japan’s e-commerce brand Rakuten ready with first ever ‘cashless stadium’”, op.cit.
26 TheStadiumBusiness Summit is delivered and owned by Xperiology.com. It is the world’s leading meeting for
the owners, operators and developers of stadiums, arenas and sport venues.
27 “Cashless Stadiums Reaching ‘Tipping Point’”, https://www.thestadiumbusiness.com/2018/10/05/cashless-
stadiums-reaching-tipping-point/, October 5th 2018
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1st Edition, Issue-1 Rakuten’s ‘Cashless Stadium’ Initiative: Will It Pay Off?
Annexure I
Rakuten’s Cashless Payment Systems at Stadiums
Rakuten Pay Smartphone App Rakuten Edy Charging Terminal
Rakuten Edy
Source: “Rakuten Group Announces Fully Cashless Smart Stadium Concept”,
https://global.rakuten.com/corp/news/press/2019/0110_02.html, January 10th 2019
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1st Edition, Issue-1 eBay’s Second Shot in India: Stormy Days Ahead?
eBay’s Second Shot in India
Stormy Days Ahead?
Case Study
This case was written by Shilpa Bhadrapur and reviewed by K. Bhagyalakshmi, Amity Research
Centers Headquarter, Bangalore. It is intended to be used as the basis for class discussion
rather than to illustrate either effective or ineffective handling of a management situation. The
case was compiled from published sources.
© 2019, Amity Research Centers Headquarter, Bangalore.
Website: www.amity.edu/casestudies/
No part of this publication may be copied, stored, transmitted, reproduced or distributed in
any form or medium whatsoever without the permission of the copyright owner.
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1st Edition, Issue-1 eBay’s Second Shot in India: Stormy Days Ahead?
Author: Shilpa Bhadrapur
eBay’s Second Shot in India: Stormy Days Ahead?
Abstract: US-based ecommerce company eBay Inc. (eBay) had entered the Indian market in
2004 with the acquisition of a home-grown site Bazee.com. At the time, the online retail
market was at a nascent stage and there were merely 3.9 million internet users in India.
However, the market scenario changed after the entry of prominent players like Snapdeal,
Flipkart and finally the US tech behemoth Amazon. These deep pocketed players had invested
heavily in the Indian market and ‘discounts’ had become a driving force in the ecommerce
sector. Despite having the first mover advantage, eBay failed to sustain its customer base. By
2016, eBay had not only suffered due to dwindling revenues but its brand image was also badly
hurt. Unable to turn tables despite several efforts; eBay sold its India business to the market
leader Flipkart in 2017. However, after the Flipkart-Walmart big billion deal in 2018, eBay
ended its strategic partnership with Flipkart but only to take a U-turn back into the lucrative
Indian ecommerce market. On the eve of New Year (2019), eBay had silently relaunched in
India and planned to go solo this time. It was an uphill task ahead as the Indian market had
changed drastically since eBay’s first launch in 2004. Amidst this scenario, would eBay’s
comeback trail in India turn around to be a huge success?
Case Study
It had been a bumpy journey for eBay in India since its launch in 2004. eBay, the US based
ecommerce company had entered India with the acquisition of Bazee.com1. At that time, the
smartphone era was yet to begin and ecommerce was an emerging phenomenon with a very
few internet users in India struggling with poor connectivity. In the first few years, eBay had
managed to expand into 240 cities across India and registered more than 2 million users.
However, the market scenario changed after the entry of prominent players like Snapdeal,
Flipkart and finally the US tech behemoth Amazon in 2007, 2010 and 2013 respectively. With
the massive growth in the number of internet users in India, the big players used deep
discounting strategies to entice consumers and Indian the ecommerce sector was driven by the
buzzword ‘Discounts’. Unlike Amazon and Flipkart who were investing heavily in the Indian
market, eBay had a laid back approach and hence failed miserably in India.2
According to analysts at Forbes, By 2016, eBay had not only faced declining revenues but its
brand image was also hurt badly due to increasing number of fake listings and bad customer
service. Pointing out that the Indian ecommerce market had become irrational and overheated
1 Baazee was India's biggest marketplace where anyone could sell or buy almost anything.
2 Mitter Sohini, “Timeline: eBay India's 13-year journey has been dotted with highs and lows”,
https://www.bgr.in/news/timeline-ebay-indias-13-year-journey-has-been-dotted-with-highs-and-lows/, August
9th 2017
“© 2019, Amity Research Centers HQ, Bangalore. All rights reserved.”
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in an interview to Recode, Devin Wenig (Wenig), CEO, eBay stated, “I’ll start by saying I really
do believe the market will be a strong commerce market. There are just too many positive
dynamics: Too much growing wealth, too much tech adoption, too much demand for goods
and supply-demand imbalance.”3 In the bid to fight growing competition in 2017, Flipkart
bought eBay's business in India. However, the partnership had lasted for only a year. In 2018,
eBay and Flipkart decided to part ways by ending their strategic partnership. eBay was
relaunched in the Indian market on New Year’s Eve (2019). However, the Indian market had
witnessed a sea change in terms of competition and new FDI regulations. Amidst this scenario
it remained to be seen if eBay’s second attempt in India would be a game changer for the
company.
eBay’s Initial Journey in India
eBay had entered the Indian market in 2004, at a time when India hardly had a market for
online retail. Most Indians were unaware of online shopping and only a few sites like
Bazee.com and Indiatimesshopping.com had existed at that time.4 eBay entered into the
Indian market with the acquisition of leading homegrown online auction site Bazee for $50
million. In 2004, the online retail market was at a nascent stage and there were merely 3.9
million internet users in India. At first eBay had just adopted the business model followed by
Bazee. However, the company changed its business model as the online retail industry in India
evolved over the years. eBay became a platform to connect merchants and customers. eBay’s
competitors like Flipkart and Amazon India had targeted the sellers operating in India, while
eBay had widened its opportunities by targeting small businesses interested in selling their
products in international markets through its platform.
Initially, the company’s business was dull, but as the number of internet users increased, the
business had gained momentum. As of 2014, the number of internet users in India had
reached 240 million. To provide small and medium businesses access to global markets, eBay
had partnered with Federation of Indian Export Organisations (FIEO) in 2012. The sellers were
required to register at eBay India and at the same time create accounts at various global eBay
sites which enabled them to sell at the international markets. US was a major market for these
exporters followed by Australia, Russia and UK. The kind of sellers signing up at eBay websites
were primarily artists or craftsmen and the products sold mainly included jewellery, ayurvedic
medicines, apparel and tea.
According to Sanchit Vir Gogia, Chief Analyst and CEO, Greyhound Research, eBay had given an
international platform to locally made products, making them available in several countries. A
major revenue stream for eBay was the fees charged for sellers to register on the site and
commission on the sale. As the orders increased with the growing number of sellers and users
on the site, the company started working on eBay's logistics system. Powership platform was
an initiative launched by the company which integrated all courier companies in India. The
platform helped in connecting with the best courier service in the location after the order got
placed. Powership was mainly for the local users while for international delivery, Powership
Global platform was formed which was tied with prominent courier companies like FedEx and
DHL. Further, the payment methods were standardised to evade online payment frauds. eBay
3 Bhushan Kul, “eBay India shuts down; Flipkart to launch marketplace for refurbished goods”,
https://www.hindustantimes.com/tech/ebay-india-shuts-down-flipkart-to-launch-marketplace-for-refurbished-
goods/story-2MwAB5UjIYqYu9M8hWLCxI.html, August 14th 2018
4 Pani Priyanka, “How eBay failed to gauge India’s e-comm scene”, https://www.thehindubusinessline.com/info-
tech/how-ebay-failed-to-gauge-indias-ecomm-scene/article9640407.ece, January 15th 2018
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1st Edition, Issue-1 eBay’s Second Shot in India: Stormy Days Ahead?
had launched its own payments platform PayPal, which was linked to seller’s bank accounts
enabling them to receive direct payments (Exhibit I).
Exhibit I
eBay’s Business at a Glance
Source: Sen Sunny, “Window to the World”, https://www.businesstoday.in/magazine/features/ebay-india-
website-helps-small-business-expand-global-reach/story/212398.html, December 7th 2014
Besides these initiatives, eBay also gave guidance to its users on how to open and operate
PayPal accounts. Training sessions in English and six regional languages were provided by the
company. Further, for users who were not very tech savvy the company executives provided
constant support for three months in setting up accounts on different eBay sites to list their
offerings. Export via eBay was still small compared to India’s total annual export market which
was valued at $300 billion as of 2014. However, analysts had predicted that ecommerce
export market was expected to increase significantly to reach $5 billion in a few years.5
eBay’s Failure in India
Over the years, the number of users on eBay site had increased to reach 2 million. However,
the entry of prominent players like Flipkart in 2007, Snapdeal in 2010 and Amazon in 2013 had
impacted eBay’s business significantly (Annexure I). The new competitors in the ecommerce
sector had invested heavily in India towards aggressive marketing and customer acquisition,
while eBay had lagged behind in its investment. Despite having the first mover advantage,
eBay failed to sustain its customer base. As business slowed down, the company was forced to
reduce its workforce and investment in marketing initiatives.6 According to analysts at Mint,
eBay’s revenue growth was 23% in 2015 with total revenues at `1.32 billion, a significant
reduction in comparison to 33% growth registered in 2014. Meanwhile, its competitor Flipkart
had generated whopping revenues of `7.724 billion in 2015 when compared to `1.79 billion in
2014.7
According to the company sources, several changes made in the top leadership had resulted in
poor management. Rajan Mehra, the first country head of eBay had left the company in 2008.
The position was later held by Amabreesh Murty (Murty) for five years before quitting in 2012.
To capitalise on the booming ecommerce industry in India, Murty went on to launch online
furniture business ‘Pepperfry’. (Exhibit II).
5 Sen Sunny, “Window to the World”, https://www.businesstoday.in/magazine/features/ebay-india-website-
helps-small-business-expand-global-reach/story/212398.html, December 7th 2014
6 Mahayan Dolly, “eBay’s India journey: 14 years of hits and misses”, https://www.exchange4media.com/digital-
news/ebays-india-journey14-years-of-hits-and-misses-91334.html, July 31st 2018
7 SH Salman, “eBay lays off employees in Bangalore claiming 'regular operational review'”,
https://www.medianama.com/2016/11/223-ebay-laysoff/, November 10th 2016
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Exhibit II
eBay’s Changing Leadership Team
Source: Talgeri Kunal, “After selling its Indian assets to Flipkart for a stake in it, what does eBay leave
behind?”,
https://economictimes.indiatimes.com/small-biz/startups/after-selling-its-indian-assets-to-flipkart-
for-a-stake-in-it-what-does-ebay-leave-behind/articleshow/58230855.cms?from=mdr, April 18th 2017
Several players like Myntra, Jabong, Flipkart and Snapdeal had entered the fast growing Indian
ecommerce market during the period (2008 –2012). While eBay was struggling to make a mark
in the competitive Indian market, ecommerce industry in India was undergoing major
developments. Most players in the Indian ecommerce sector were altering their business
models to suit the market dynamics and government regulations. “However eBay didn’t
change. It was trying to do things in India that it did globally; but the playbook was not working
at all,” expressed an Indian official of eBay.8
Yet, there were a few initiatives that the company had undertaken during the period (2008-12)
which included setting up a development center, including shopping cart and starting a
payment service known as PaisaPay. At that time, the company was growing rapidly at 100%
year on year while the market growth was registered at 20%. However, with the entry of new
competitors like Snapdeal and Flipkart in India’s ecommerce market (2012 -14), eBay’s
business had taken a beating. eBay’s failure in India was similar to its fate in China where it was
acquired by Alibaba in 2005. According to a former company official, “Auctions didn’t work in
India and will never work, Indian consumers care for upfront prices and discounts and the
auction mechanism online was cumbersome and took days to materialise. You can’t build
volumes in such cases when the payment mechanism online was also not evolved.” He further
mentioned that eBay had failed to demonstrate the aggression and innovation that was
required to succeed in the Indian market. He further added, “It couldn’t gauge the explosion
that was about to occur in the Indian online segment.”9
With the slowdown in business, eBay had started cutting down jobs and invested less in
marketing efforts to improve sales. After a huge gap of three years, the company had started
an integrated campaign in 2016 but failed to bring about any significant impact to the
business. Further, eBay in an effort to sustain in the competitive market had invested in Jasper
Infotech, the parent company of Snapdeal in 2014. However the deal had boomeranged and
eBay registered heavy losses10 to the tune of $61 million. Consequently, eBay sold a partial
stake in Snapdeal in 2016.
8 “How eBay failed to gauge India’s e-comm scene”, op.cit.
9 ibid.
10 “eBay’s India journey: 14 years of hits and misses”, op.cit.
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Further, in 2017, eBay had acquired 5.44% stake in the ecommerce unicorn Flipkart for
exchange of its eBay India (ebay.in) business and had made cash investment of $500 million.
eBay had gained a profit of $167 million through the sale of its Indian arm to Flipkart. Both the
companies had also agreed to explore the cross-border trade opportunities jointly.11 Further,
Flipkart stated, “Effective immediately, Flipkart will own and operate eBay.in, which will
remain an independent entity as part of Flipkart. As a result, Flipkart customers will get
expanded product choices with the wide array of global inventory available on eBay while eBay
customers will have access to a more unique Indian inventory from Flipkart sellers.” Kalyan
Krishnamurthy, CEO, Flipkart further added, “Our coming together directly benefits Indian
customers and sellers for whom we want to provide the best possible e- commerce
experience. This is a step in that direction.”12 (Exhibit III).
Exhibit III
eBay and Flipkart Partnership – A Snapshot
Source: Anand Shambhavi “Flipkart to close eBay.in, sell used goods at new
bay”,https://economictimes.indiatimes.com/industry/services/retail/flipkart-to-close-ebay-in-sell-
used-goods-at-new-bay/articleshow/65111873.cms?from=mdr
However, eBay and Flipkart’s strategic partnership just lasted for a year from August 2018 and
ended on 14th August 2018. eBay India platform had formally shut down operations and
stopped accepting any new orders from 14th August 2018. Flipkart planned to launch its own
platform to sell refurbished goods, while eBay planned to enter the Indian market
independently. According to Krishnamurthy, “Based on our learnings at eBay.in, we have built
a brand new value platform launching with refurbished goods - a large market which is
predominantly unorganised. With Flipkart's customer base and F1 Info Solutions & Services in
our group portfolio, I believe that we can solve the key barriers to refurbished - trust &
convenience - at scale… Our endeavour will be to ensure that all the eBay.in sellers and
customers migrate to the new platform overtime with a remarkably enhanced experience.”
Flipkart and eBay announced their decision to end the partnership in May 2018 (Exhibit IV). In
this regard, a company source stated, “Following the close of transaction, we also will be
ending our current strategic relationship with Flipkart, which includes unwinding our
commercial agreements with Flipkart and terminating Flipkart's licence to use the eBay.in
brand.” The target audience for the new platform launched by flipkart was different and had
different value proposition in comparison to the parent company.”13
11 Shrivastava Aakriti, “eBay's investment in Snapdeal led to $61 million loss”,
https://www.medianama.com/2018/02/223-ebays-investment-snapdeal-led-61-million-loss/, February 8th 2018
12 “Flipkart completes eBay India merger”, https://economictimes.indiatimes.com/small-biz/startups/flipkart-
completes-ebay-india-merger/articleshow/59858165.cms, August 1st 2017
13 “eBay shuts shop; parent Flipkart works on new brand”,
https://www.businesstoday.in/current/corporate/flipkart-part-ways-ebay-start-new-platform-refurbished-
goods/story/280615.html, July 24th 2018
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Exhibit IV
EBay’s Exit from India
Source: Variyar Mugdha, “eBay in talks with etailers, including ShopClues, for a fresh bid in
India”, https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/ebay-in-talks-with-
etailers-including-shopclues-for-a-fresh-bid-in-india/articleshow/65157378.cms, July 27th 2018
In 2018, a major development happened in the Indian ecommerce sector when the
international e-commerce giant Walmart Inc., acquired a huge 77% stake in Flipkart for $16
billion. It was Walmart's biggest acquisition and one of the world’s largest ecommerce deals.
Walmart had invested additional $2 billion to battle its arch rival Amazon in the international
market.14 On account of the Walmart - Flipkart deal, eBay had planned to sell its holdings in
Flipkart for about $1.1 billion. And the company had planned to launch in India independently,
“We plan to relaunch eBay India with a differentiated offer to focus initially on the cross-
border trade opportunity, which we believe is significant, we believe there is huge growth
potential for e-commerce in India and significant opportunity for multiple players to succeed in
India’s diverse, domestic market.”15
Will eBay Succeed in its Second Attempt in India?
eBay was embarking on a new journey in India a day after its old strategic partner Flipkart had
launched its own refurbished platform 2GUD. eBay had planned to re-launch with a
differentiated offering by starting an export business to enable Indian sellers to sell across
major international markets. After Flipkart was acquired by Walmart, eBay.in operations were
taken over by eBay. “We are immediately focused on the cross-border trade opportunity and
encourage India-based sellers to continue to take advantage of eBay’s global platform and sell
to customers around the world,” stated a company source. In 2017, eBay had acquired a 5.44%
stake in Flipkart for the exchange of eBay India business. After the deal, Flipkart was planning
to use eBay’s platform for global outsourcing. Further, after Walmart acquired Flipkart in 2018,
eBay had planned to relaunch its Indian operations and differentiate its offerings by mainly
focusing on cross border selling.
14 “Walmart acquires Flipkart for $16 billion in world’s largest ecommerce deal”,
https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/walmart-acquires-flipkart-for-16-bn-
worlds-largest-ecommerce-deal/articleshow/64095145.cms, May 10th 2018
15 Lunden Ingrid, “eBay plans to relaunch eBay India after it makes $1.1B selling its Flipkart stake to Walmart”,
https://techcrunch.com/2018/05/09/ebay-plans-to-relaunch-ebay-india-after-it-makes-1-1b-selling-its-flipkart-
stake-to-walmart/, May 2018
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In this regard, Wenig stated, “In India, we will start with exports, meaning Indian sellers selling
on other marketplace platforms around the world; that was something that we turned over to
Flipkart. We are going to get that back upon the closing of the transaction. So, we will light up
the Indian seller base to sell across all of our major markets.” Wenig further added that the
company would also resume operations with a differentiated import inventory system for the
Indian market. After ending partnership with Flipkart, eBay had tried exploring the Indian
market for viable partners like ShopClues to re-enter the Indian ecommerce market. As per the
report published by Statistic, online selling sites in the global market will cross $3.5 trillion by
2019, while the global cross-border ecommerce market size was estimated to increase by two
folds to reach $424 billion by 2021. According to analysts, the Indian ecommerce market had
become more competitive with the consolidation of prominent ecommerce players like
Walmart –Flipkart, Google, Amazon etc. eBay’s entry into the export market would give it a
competitive edge in the market.16 eBay’s strategy to focus on cross-border trade would give
the much needed global exposure to Indian sellers and global brands to Indian consumers.
Similarly JD.com and Alibaba, the Chinese ecommerce companies were pushing for cross-
border trades on their platforms.17
According to Wenig, eBay had relaunched in India on New Years Eve (2019) and was in its
phase 1. He further informed that the Indian ecommerce market was in its initial growth phase
and still had tremendous potential for development, and eBay was working on capturing a big
chunk of the growing ecommerce market. “Right now, Indian buyers are seeing eBay.india
again. And phase 2 will be the ability for domestic sellers to sell directly in the Indian market
and obviously, today domestic Indian sellers are exporting as they were before the Flipkart
transaction,” added Wenig (Exhibit V).
Exhibit V
eBay’s U Turn in India
Source: “Who’s afraid of Amazon and Flipkart? Certainly not eBay”,
https://economictimes.indiatimes.com/industry/services/retail/whos-afraid-of-amazon-and-flipkart-certainly-
not-ebay/articleshow/67783338.cms, February 1st 2019
Since 2004 eBay had struggled to find a strong footing in the Indian ecommerce industry. But,
large companies such as Flipkart and Amazon in the bid to penetrate the Indian market had
16 Khatri Bhumika, “eBay To Embark On A New Journey In India By Facilitating Exports For Sellers”,
https://inc42.com/buzz/ebay-to-embark-on-a-new-journey-in-india-with-exports-for-sellers/, August 23rd 2018
17 Gunter Rachel, “Why eBay Favors Cross-Border Trade in Its Relaunch in India”,
https://articles.marketrealist.com/2018/06/why-ebay-favors-cross-border-trade-in-its-relaunch-in-india/, June
4th 2018
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offered heavy discounts and promotional tactics. Nevertheless, as of 31st January 2019, eBay’s
re-entry into the Indian market was at the most apt time with government’s new FDI policy on
ecommerce. The new FDI policies had made it tough for bigger players like Flipkart and
Amazon in the Indian ecommerce market to introduce unreasonably huge discounts.18
The FDI had tightened the norms for ecommerce firms like Flipkart and Amazon and stated
that these companies were not permitted to own or control inventory. They were allowed to
only cater to services like logistics, advertising and warehouse facilities to sellers. It also
prohibited the ecommerce firms to have deals with the sellers to push the sales of particular
products or have equity stakes in seller companies, giving rise to unfair competition. Analysts
felt that eBay’s relaunch would encourage other ecommerce players who were forced to shut
down because of huge discounts offered by ecommerce companies backed by foreign
investments. “If the government allows a level playing-field and new guidelines are
implemented strictly, there will be a plethora of startups who had buckled due to cash burn
that will get into online retailing,” informed Kumar Rajagopalan, CEO, Retailers Association of
India (RAI). He further added, “There will be a resurgence of two types of players - pure play
marketplaces such as eBay and sellers who have been competing with online companies
instead of other vendors in the same marketplace.”19
However, some analysts felt that the new FDI policy guidelines implemented on 1st Feburary
2019 had slowed down the Indian ecommerce market. Consequently, the predictions for the
growth of the Indian ecommerce industry were altered by analysts at Morgan Stanley. As of
2019, online retail market in India was estimated to reach $200 billion only in 2027 compared
to its previous estimate to reach the figure in 2026. In 2018, the retail ecommerce market was
expected to reach $32.7 billion and by 2022 the sector was expected to reach a phenomenal
growth at $71.9 billion.20
Analysts had pointed out that the uncertainty prevailing in the Indian ecommerce market had
adversely affected the revenue growth for ecommerce giants. Sales numbers which were
previously estimated to grow at 25% to 30% were expected to decrease by half to 15% in the
future. The industry experts felt that these policies had constrained the growth of the
ecommerce companies in the Indian market. So far the ecommerce players were able to make
significant inroads into the overall retail industry due to the convenience of the process,
availability of attractive pricing options, huge variety of goods to choose from and the overall
growing demand. According to analysts at Morgan Stanley, these new FDI policy guidelines
were not only hindering the growth of the sector but also increasing the cost of operation for
the players in the ecommerce sector.21
Moreover Walmart’s Flipkart acquisition was expected to create intense competition in the
Indian ecommerce industry. Further, Amazon had also announced the infusion of `26 billion of
additional capital to battle the growth competition. Adrian Lee (Lee), Research Director,
Gartner further informed, “Expect the status quo to remain within the year after the Flipkart-
Walmart deal is completed. This is an extension of Walmart’s global expansion strategy. This
should not be observed without mention to Alibaba Group’s intent to become the third player
18 “eBay Is Back To The Indian Bay, Co Sees Multiple Opportunities”, op.cit.
19 Malviya Sagar, “eBay to re-enter India amidst uncertainty over e-commerce FDI norms”,
https://tech.economictimes.indiatimes.com/news/internet/ebay-to-re-enter-india-amidst-uncertainty-over-e-
commerce-fdi-norms/67782908, February 1st 2019
20 Choudhary Ambika, “India Ecommerce Market: $200 Billion By 2027, Slower Growth Than Expected Earlier”,
https://dazeinfo.com/2019/02/21/india-ecommerce-market-growth-2027/, February 21st 2019
21 “India Ecommerce Market: $200 Billion By 2027, Slower Growth Than Expected Earlier”, op.cit.
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1st Edition, Issue-1 eBay’s Second Shot in India: Stormy Days Ahead?
in India.” Lee further noted, “Smaller players constantly face a problem of scaling up their
operations. However, this does not mean that they will be forced to exit. The smaller players in
many cases are more agile and open to new business models. They should concentrate on
specialization within their domains to build up a valuable cache of users seeking differentiated
retail experiences.”22
eBay was taking a second shot in India with an aim to focus on cross-border retail, which made
up a small portion of the overall online transactions that took place in India. However, there
were other bigger players like Amazon and Alibaba who were also planning to enter the cross-
border ecommerce market. Wenig further explained, “The anticipation is that we will come
back into the Indian market both through an import and an export strategy. We will start with
export meaning Indian sellers selling on other marketplace platforms around the world that
was something that we turned over to Flipkart. We are going to get that back upon the closing
of the transaction.” Amidst such scenario, analysts at Moneycontrol News had questioned,
“Will eBay’s bid to win over India the second time around be a success? One would think there
is a need to return to the drawing board. Time is running out as big names from foreign shores
eye the challenge and wealth that Indian ecommerce promises.23
Annexure I
A Breakup of India’s Ecommerce Market Share
Source: “Can A Diversified Product Portfolio Help eBay's Growth In India?”,
https://www.forbes.com/sites/greatspeculations/2016/08/02/can-a-diversified-product-portfolio-
help-ebays-growth-in-india/, August 2nd 2016
22 Kulkarni Mahesh, “Walmart deal: Ecommerce industry to see intense competition”,
https://www.deccanherald.com/business/walmarts-acquisition-flipkart-ecommerce-industry-see-intense-
competition-669107.html, May 9th 2018
23 “Podcast | The end of the day for eBAY India”,
https://www.moneycontrol.com/news/business/startup/podcast-the-end-of-the-day-for-ebay-india-
2839861.html, August 17th 2018
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1st Edition, Issue-1 Campbell's Turnaround Plans Under CEO Mark Clouse
Campbell's Turnaround Plans Under
CEO Mark Clouse
Case Study
This case was written by Nilosha Sharma and reviewed by Doris Rajakumari John, Amity
Research Centers Headquarter, Bangalore. It is intended to be used as the basis for class
discussion rather than to illustrate either effective or ineffective handling of a management
situation. The case was compiled from published sources.
© 2019, Amity Research Centers Headquarter, Bangalore.
Website: www.amity.edu/casestudies/
No part of this publication may be copied, stored, transmitted, reproduced or distributed in
any form or medium whatsoever without the permission of the copyright owner.
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1st Edition, Issue-1 Campbell's Turnaround Plans Under CEO Mark Clouse
Author: Nilosha Sharma
Campbell's Turnaround Plans Under CEO Mark Clouse
Abstract: Campbell Soup Company (Campbell) headquartered at Camden, N.J., was a global food
company with annual sales of around $8 billion. In 1869, two partners, Joseph Campbell and
Abram Anderson, started to can tomatoes, vegetables, preserves, and other products. Over the
years, Campbell was led by various CEO’s who tried to put the company on the growth track. In
2015, the food industry witnessed various trends like shifting demographics, changing consumer
preferences for food, the adoption of new shopping behaviors and the dynamic retailer
landscape. With changing times, Campbell failed to address the millennials who did not
appreciate the food brands which were liked by their parents. There was a continuous sales
decline of Campbell soup. Also, CEO Denise Morrison exited the company without giving any
reason and the company struggled to turnaround. Then in 2018, Mark Clouse (Clouse) was
appointed as the new President and CEO of the company and was expected to help drive the
struggling company’s turnaround. The management and shareholders had high expectations
from the new CEO. Clouse came up with various new strategies and tried to optimise the
company’s portfolio, focused on reducing the debts and become more focused on the company’s
core. Clouse was optimistic about the revival and viewed that with great brands on hand and a
‘high-powered’ team, the company could be back on track. Amidst this backdrop, it remained to
be seen whether the turnaround plans undertaken by CEO Mark Clouse would help Campbell in
reviving its past glory in the coming years.
Case Study
“I certainly don’t want to portray this as simple or an overnight fix.”1
– Mark A. Clouse, President and Chief Executive Officer
Campbell Soup Company (Campbell) founded in 1869 was a global food company which was
driven and inspired by its Purpose, ‘Real food that matters for life’s moments’.2 The
company comprised of brands like Arnott’s, Pepperidge Farm cookies and Goldfish crackers,
Kjeldsens and Royal Dansk biscuits, V8 beverages, Bolthouse Farms super-premium beverages,
carrots and dressings, Garden Fresh Gourmet salsas, hummus, dips and tortilla chips, Plum
premium organic baby food, Swanson broths, Prego pasta sauces, Pace Mexican sauce, Pacific
Foods organic broths, soups and plant-based beverages and Snyder’s-Lance snacks.3
1 Brubaker Harold, “No ‘overnight fix’: Campbell Soup’s new CEO says after beating Wall Street estimates”,
https://www.philly.com/business/campbell-soup-earnings-ceo-mark-clouse-20190227.html, February 27th 2019
2 “CAMPBELL SOUP FOUNDATION ANNOUNCES 2019 GRANT RECIPIENTS”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-soup-foundation-announces-
2019-grant-recipients/, May 1st 2019
3 “About Us”, https://www.campbellsoupcompany.com/about-campbell/
“© 2019, Amity Research Centers HQ, Bangalore. All rights reserved.”
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In 2015, Campbell reorganised into three segments thereby creating Campbell Fresh unit
which was formed by combining its ‘Packaged Fresh division with soups sold to supermarket
delis.’ But Campbell Fresh faced a continuous two year decline in organic sales. Campbell Soup
announced a loss of $393 million chiefly because of a ‘$619 million charge related to Campbell
Fresh’. Other than losses, the company blamed changing consumer demand towards healthier
options in the market. The shifting consumer tastes led to a continuous four years sales decline
at the Campbell Soup business. Denise Morrison, former President and Chief Executive Officer
of Campbell abruptly resigned the company in 2018 without providing any reason for the exit.
Keith McLoughlin was made the interim CEO of the company4 but soon Mark Clouse (Clouse)
was appointed as the new President and CEO of Campbell.5 The shareholders had much
expectation from the initiatives to be undertaken by Clouse to revive the company on the
growth track.6 In 2019, Campbell witnessed ‘better-than-anticipated earnings’ which was
appreciated as a positive sign of the appointment of Clouse. Campbell recorded increased net
sales of $2.71 billion.7 Despite various efforts, analysts viewed that Campbell was not able to
make its mark among young consumers.8 In this backdrop, it remained to be seen whether the
turnaround plans undertaken by CEO Mark Clouse would help Campbell in reviving its past
glory in the coming years.
Campbell Soup Company: Journey from Bloom to Gloom
Headquartered at Camden, N.J., Campbell Soup Company (Campbell) was a global food
company with annual sales of around $8 billion.9 (Exhibit I). Two partners named Joseph
Campbell and Abram Anderson started to can tomatoes, vegetables, preserves, and other
products in 1869.10 The company comprised of a range of products which included simple
meals, high-quality soups, snacks, beverages and packaged fresh foods. Other than this, the
company’s product portfolio included Kjeldsens and Royal Dansk biscuits, Snyder’s-Lance
snacks, Arnott’s, Pepperidge Farm cookies and Goldfish crackers, V8 beverages, Bolthouse
Farms super-premium beverages, carrots and dressings, hummus, dips and tortilla chips, Plum
premium organic baby food, Swanson broths, Prego pasta sauces, Pace Mexican sauce, Pacific
Foods organic broths, soups and plant-based beverages, and Garden Fresh Gourmet salsas.11
Besides this, Campbell acquired Bolthouse Farms12 in 2012 to expand its product portfolio.
Denise Morrison (Morrison), Campbell’s President and Chief Executive Officer, stated, “We
4 Balu Nivedita and Cavale Siddharth, “Campbell Soup CEO quits; company cuts forecast, to review portfolio”,
https://www.reuters.com/article/us-campbell-soup-ceo/campbell-soup-ceo-quits-company-cuts-forecast-to-
review-portfolio-idUSKCN1IJ1FA, May 18th 2018
5 “CAMPBELL NAMES MARK A. CLOUSE PRESIDENT, CHIEF EXECUTIVE OFFICER AND A DIRECTOR OF THE BOARD”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-names-mark-a-clouse-president-
chief-executive-officer-and-a-director-of-the-board/, December 20th 2018
6 “A tough task awaits Campbell Soup’s new CEO Mark Clouse”, https://news.alphastreet.com/a-tough-task-
awaits-campbell-soups-new-ceo-mark-clouse/, December 24th 2018
7 Shanker Deena, “Campbell Shares Rise After Earnings Beat Estimates Under New CEO”,
https://www.bloomberg.com/news/articles/2019-02-27/campbell-shares-rise-after-earnings-beat-estimates-
under-new-ceo, February 27th 2019
8 “Can New Strategies Keep Campbell Soup from Going Cold?”,
https://knowledge.wharton.upenn.edu/article/campbells-can-rebound/, May 30th 2018
9 “ABOUT US”, op.cit.
10 “Campbell Soup Company”, https://www.britannica.com/topic/Campbell-Soup-Company
11 “ABOUT US”, op.cit.
12 Headquartered in Bakersfield, Calif., Bolthouse is a vertically integrated food and beverage company focused
on developing, manufacturing and marketing proprietary, high value-added natural, healthy products. The
company has leading market positions in fresh carrots and super-premium beverages in the U.S., along with a
growing presence in refrigerated salad dressings. Bolthouse employs about 2,100 people.
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have acquired a terrific business that is a good strategic fit with Campbell’s existing portfolio
and growth strategies. Bolthouse Farms has exceptional employees and fantastic products.
This gives Campbell one of the leading positions in both the fast-growing packaged fresh food
market and in healthy beverages and provides us with an opportunity to expand into adjacent
segments that leverage exciting consumer trends.”13
Exhibit I
Campbell Soup
Source: Ladd Brittain, “Campbell Soup At A Crossroads: What The Company Must Do Now”,
https://www.forbes.com/sites/brittainladd/2018/08/06/campbell-soup-at-a-crossroads-what-the-
company-must-do-now/#20a2b9f8551d, August 6th 2018
Then in 2013, Campbell acquired another group, Kelsen Group A/S.14,15 Morrison stated, “We
are delighted to welcome the Kelsen team to Campbell and to add Kelsen’s distinctive brands
to Campbell’s outstanding portfolio of baked snacks, including our Pepperidge Farm cookies
and crackers in North America and Arnott’s biscuits in Australia. Kelsen will give Campbell a
solid platform for growth in baked snacks in China and for the expansion of our international
footprint. The acquisition of this successful business is another important step in Campbell’s
quest to delight new consumers through expansion into higher-growth spaces, including fast-
growing emerging markets.”
Luca Mignini (Mignini), President – Campbell International, stated, “Kelsen’s combination with
Campbell will represent a wonderful marriage of complementary skills and capabilities. Its
strong position in China and Hong Kong will enhance our presence in the region. At the same
time, Kelsen’s talented management team will have the opportunity to leverage Campbell’s
marketing, consumer insights, R&D and supply chain expertise to grow the business in both
13 “CAMPBELL COMPLETES ACQUISITION OF BOLTHOUSE FARMS”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-completes-acquisition-of-
bolthouse-farms/, August 6th 2012
14 A producer of quality baked snacks, including the Kjeldsens and Royal Dansk brands, sold in 85 countries
around the world. Based in Nørre Snede, Denmark, Kelsen is a market leader in the assortment segment of the
sweet biscuits category in China and Hong Kong, where growth in sweet biscuits is outpacing the growth of the
$60 billion global sweet biscuits market.
15 “CAMPBELL COMPLETES ACQUISITION OF KELSEN GROUP”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-completes-acquisition-of-kelsen-
group/, August 8th 2013
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new and existing markets.” Brian Rønsholdt, CEO, Kelsen Group, stated, “Kelsen has been
providing quality products to consumers for over 75 years. We look forward to joining
Campbell and its family of trusted brands. Campbell’s consumer-focused capabilities and wide-
ranging experience in biscuit production will provide new resources for enhancing Kelsen’s
product lines and strengthening our engagement with consumers around the world.”16
Upon completion of the acquisition, Mignini stated, “We are excited to bring Kelsen’s talented
team and distinctive brands to Campbell. The acquisition of Kelsen, with its strong brand
awareness in China and Hong Kong, is an ideal complement to Campbell’s global baked snack
businesses and a platform for additional growth for Campbell in key emerging markets.”17
Thereafter in 2015, the company acquired assets and business of Garden Fresh Gourmet18 for
$231 million. Jeff Dunn (Dunn), President–Campbell Fresh, stated, “The acquisition of Garden
Fresh Gourmet provides Campbell with another platform for growth in a key strategic area –
the fast-growing perimeter of the grocery store. Garden Fresh Gourmet’s on-trend products
are the ideal complement to the Bolthouse Farms portfolio in the produce section and will help
extend our presence in the deli section. We’re excited to take Garden Fresh Gourmet to the
next level.”19
The company made various acquisitions over the years keeping in view the growing interest of
consumers towards health and well-being and growing demand for fresh foods. Morrison
stated, “The acquisition of Garden Fresh Gourmet is another milestone in reshaping our
portfolio toward faster-growing categories, including packaged fresh and organic foods.
Garden Fresh Gourmet’s on-trend products will provide Campbell with another growth engine
to help us continue to shift our center of gravity.” Dunn said, “Garden Fresh Gourmet will allow
the Campbell Fresh division to expand in the deli section of the grocery store perimeter and
will complement our strong presence in the produce section. It is a logical extension of our
fresh food and beverage platform that resonates with today’s consumers. This is a critical next
step in our journey to becoming the leader in the fast-growing packaged fresh category.
Garden Fresh Gourmet is an American success story, whose leadership has built a vibrant
brand with a loyal following in faster-growing categories like refrigerated salsas and hummus.
We will leverage our packaged fresh production and distribution, sales and brand-building
capabilities to help Garden Fresh Gourmet become a national brand.”20
Besides this, under the leadership of Morrison, Campbell charted out a detailed plan to
strengthen the business with the help of four strategic essentials (Exhibit II).
16 “CAMPBELL TO ACQUIRE KELSEN GROUP TO EXPAND ITS INTERNATIONAL PRESENCE AND DRIVE BAKED SNACKS
GROWTH IN CHINA”, https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-to-acquire-
kelsen-group-to-expand-its-international-presence-and-drive-baked-snacks-growth-in-china/, June 17th 2013
17 “CAMPBELL COMPLETES ACQUISITION OF KELSEN GROUP”, op.cit.
18 Garden Fresh Gourmet is the No. 1 branded refrigerated salsa in the U.S. and also makes hummus, dips and
tortilla chips.
19 “CAMPBELL COMPLETES ACQUISITION OF GARDEN FRESH GOURMET”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-completes-acquisition-of-garden-
fresh-gourmet/, June 29th 2015
20 “CAMPBELL TO ACQUIRE GARDEN FRESH GOURMET TO EXTEND PRESENCE IN FASTER-GROWING PACKAGED
FRESH CATEGORY”, https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-to-acquire-
garden-fresh-gourmet-to-extend-presence-in-faster-growing-packaged-fresh-category/, June 9th 2015
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Exhibit II
Campbell Soup Company Planned Key Strategies for Growth in 2016
# Initiatives Taken by Campbell Soup Company
1 Elevate trust through real food, transparency and sustainability.
2 Build digital and e-commerce capabilities.
3 Continue to diversify Campbell’s portfolio in health and well-being with fresh, organic and
healthful foods and
4 Expand Campbell’s presence in developing markets.
Source: Compiled by the Author from – “CAMPBELL OUTLINES KEY STRATEGIES FOR GROWTH”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-outlines-key-
strategies-for-growth/, July 20th 2016
Morrison stated, “Over the last five years, we’ve taken a number of bold steps to reposition
the company for not just profitable, but sustainable growth. Our progress has been
methodical. We’ve improved our company and shifted our center of gravity. But we have
higher aspirations for the food we make, the role we play in people’s lives and improving our
growth trajectory. That’s why it’s necessary to continue to relentlessly improve ourselves, our
food, our business and our culture to further differentiate Campbell and to forge a meaningful
and lasting place in the lives of new generations of consumers.”21 The company also
redesigned its three major segments in its product categories namely, The Americas Simple
Meals and Beverages segment, The Global Biscuits and Snacks segment and The Campbell
Fresh segment.22 (Exhibit III).
Exhibit III
Three Segments of Campbell Soup Company
# Segment Product Categories
The Americas The largest division and the company’s economic engine will be
1 Simple Meals managed for moderate growth and margin expansion and is focused on
and Beverages responding to consumer shifts with changes in its core portfolio and a
segment more focused approach to innovation.
The Global Unifies the Pepperidge Farm, Arnott’s and Kelsen businesses into a fully
2 Biscuits and integrated biscuits and snacks portfolio, is focused on strengthening its
Snacks segment core markets and expanding in developing markets.
Now combines recently-acquired Garden Fresh Gourmet with the
The Campbell Bolthouse Farms portfolio and Campbell’s retail refrigerated soups, is
Fresh segment
3 focused on building scale and accelerating growth in rapidly expanding
packaged fresh categories as the company strengthens its health and
well-being platform.
Source: “CAMPBELL TO PROVIDE UPDATE ON BUSINESS STRATEGIES AND OUTLINE KEY INITIATIVES
FOR FISCAL 2016”, https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-to-
provide-update-on-business-strategies-and-outline-key-initiatives-for-fiscal-2016/, July 22nd 2015
21 “Campbell Outlines Key Strategies for Growth”,
http://investor.campbellsoupcompany.com/phoenix.zhtml?c=88650&p=irol-newsArticle_Print&ID=2186840, July
20th 2016
22 “CAMPBELL TO PROVIDE UPDATE ON BUSINESS STRATEGIES AND OUTLINE KEY INITIATIVES FOR FISCAL 2016”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-to-provide-update-on-business-
strategies-and-outline-key-initiatives-for-fiscal-2016/, July 22nd 2015
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The company showcased as to how its real food philosophy was changing and what were the
steps undertaken by Campbell to improve its quality of food to attract customer’s attention by
removing artificial colours and flavours from its North American products by the end of 2018.
Morrison stated, “We believe real food should be made with recognizable, desirable
ingredients from plants or animals. It should be responsibly crafted using ethical sourcing and
sustainable practices that safeguard natural resources. Lastly, it should always be delicious,
safe and available at a fair price…all three without compromise.”
Mark Alexander (Alexander), President – Americas Simple Meals and Beverages discussed how
the company had made a fundamental shift in the way food was made. The company had also
developed a scorecard called as ‘Campbell’s Real Food Index’ to keep a track on the quality of
ingredients. Along with this the company also kept a track on removal of artificial colours and
flavours from its North American products by the end of 2018. The Index was available on
‘www.whatsinmyfood.com.’ Besides this, the company decided to use only antibiotic-free
chicken in the products. Alexander stated, “We have defined our real food philosophy and laid
out a plan to evolve our portfolio over time. This will not be a straightforward journey, or an
easy one, but we are resolutely committed to it.”
Campbell also planned to come up with fresh products and as part of that came up with its first
product, Bolthouse Farms Plant Protein Milk, which was non-dairy milk.23 In addition to this,
Campbell made efforts to change its recipes and also tried to increase its organic offerings.
Alexander said, “We know that many parents are seeking products made with simpler
ingredients for their children. As a result, we are extending our line of kids soups with organic
varieties and simplifying recipes to make them an easy choice for parents ˗˗ and fun for kids.”24
Although the company planned various strategies for growth, the company’s shares fell by
more than 6% and also the revenues declined, mainly due to the changing consumer behaviour
patterns. Morrison stated, “The operating environment for the packaged foods industry
remains challenging due to shifting demographics, changing consumer preferences for food,
the adoption of new shopping behaviors and the dynamic retailer landscape. In these times,
sales growth remains a challenge.”
Other than this, the earnings declined due to emergence of new store formats, new players
and evolving business models. Morrison stated, “Several variables are at play including value
players expanding their presence in the U.S., the growth of store brands and the explosion of
e-commerce and meal delivery services disrupting the market. We expect conditions to remain
hyper competitive for the foreseeable future.”25 The company was not in sync with the
demands of young consumers due to which it faced sales decline in its businesses like V8
juices, soup, and SpaghettiOs. In the meantime, Morrison abruptly resigned from her position
due to continuous declining performance of the company under her leadership.26
23 “CAMPBELL OUTLINES KEY STRATEGIES FOR GROWTH”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-outlines-key-strategies-for-
growth/, July 20th 2016
24 “CAMPBELL CONTINUES TO SHIFT PORTFOLIO TOWARD FASTER-GROWING CATEGORIES AND REGIONS”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-continues-to-shift-portfolio-
toward-faster-growing-categories-and-regions/, July 22nd 2015
25 Linnane Ciara, “Campbell Soup has a soup problem”, https://www.marketwatch.com/story/campbell-soup-
has-a-soup-problem-2017-08-31, September 3rd 2017
26 Hirsch Lauren, “Campbell Soup CEO resigned suddenly, industry insiders have their eyes on a potential
replacement”, https://www.cnbc.com/2018/05/18/campbell-ceo-resigned-suddenly-possible-successor-
identified.html, May 18th 2018
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Industry analysts viewed that the obvious reasons behind her failure were she used ‘large
acquisitions to diversify a brand and product portfolio that mostly consisted of processed
soups, V8 juices, Prego pasta sauce, and Pepperidge Farm snacks.’ Although she acquired many
new brands, Morrison was neither able to reckon with nor could she overcome the execution
challenges as a CEO. In addition to this, the company was not able to integrate all these
acquisition made by Morrison ‘into a seamless company’. Analysts further viewed that there
was a ‘problem of cultural fit between Campbell and the startups’.27
Replacing Morrison, Keith R. McLoughlin (McLoughlin), who was a board member since 2016,
was appointed as the interim CEO.28 Luca Mignini was appointed as the COO of the company29
and would look after integrating the newly acquired companies Snyder’s-Lance and Pacific
Foods and the stabilization of the U.S. soup business.30 Meanwhile McLoughlin assured the
shareholders in the annual meeting about the efforts taken to turn around the company.
McLoughlin assured them and stated, “There are significant changes happening at your
company. We are pleased with the pace of our progress, but by no means are we declaring
victory. This is the beginning. We recognize that much more work lies ahead of us. The
turnaround of the Campbell's Soup Company is underway.”
The major challenge for Campbell was that consumers were turning away from processed
items like canned soup and the company had failed to expand into fresh foods despite
acquiring Bolthouse Farms and Garden Fresh Gourmet. Besides, the declining share prices of
the company led investors like Daniel Loeb (Loeb) to protest for change. Loeb’s demands
included ‘sale of the company’, ‘removal of the entire 12-person Campbell Soup board’ (three
descendants of the founder). Later following a deal with the company, Loeb scaled down his
demand to remove two board members. In the meantime, the company also looked for a new
CEO.31 And the search for the new CEO ended with the appointment of Mark Clouse (Clouse)
who was the former CEO of Pinnacle Foods Inc. Third Point helped in the search process for the
new CEO and also gave constructive inputs and further supported Campbell’s decision to name
Mark Clouse.32 (Annexure I).
Can CEO Mark Clouse’s Turnaround Plans Revive the Brand?
Clouse was a veteran military person who served in the U.S. Army. He graduated from the
United States Military Academy at West Point. Clouse started with joining the food industry
and became the Chief Growth Officer at Mondelez International. He had also worked in
marketing for Kraft Heinz.33 (Exhibit IV). Les Vinney (Vinney), Chairman, Campbell’s board,
stated, “Mark Clouse is an outstanding leader with a proven track record of operational
27 Buss Dale, “Campbell Soup CEO Leaves: A Warning for Acquisitive Leaders”,
https://chiefexecutive.net/campbell-soup-ceo-resigns-warning-acquisitive-leaders/, May 24th 2018
28 Marchat Alissa, “Campbell Soup Co.’s CEO Steps Down Suddenly, Interim CEO Named”,
https://www.theshelbyreport.com/2018/05/18/campbell-ceo-steps-down-suddenly/, May 18th 2018
29 “Campbell Soup CEO resigned suddenly, industry insiders have their eyes on a potential replacement”, op.cit.
30 Redman Russell, “Campbell Soup CEO steps down”, https://www.supermarketnews.com/executive-
changes/campbell-soup-ceo-steps-down, May 19th 2018
31 Doering Christopher, “Campbell Soup interim CEO focused on turnaround, but 'much more work lies ahead'”,
https://www.fooddive.com/news/campbell-soup-interim-ceo-focused-on-turnaround-but-much-more-work-lies-
a/542628/, November 29th 2018
32 “Mark Clouse to take the reins at Campbell”, https://www.potatopro.com/news/2018/mark-clouse-take-reins-
campbell, December 21st 2018
33 “Campbell Soup names industry veteran Mark Clouse CEO”, https://www.cnbc.com/2018/12/20/campbell-
soup-nears-deal-to-name-mark-clouse-ceo-sources-say.html, December 20th 2018
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excellence, and we are excited to name him as Campbell’s next president and CEO. Mark’s
leadership as CEO of Pinnacle Foods shows a clear track record of delivering solid revenue and
earnings growth and generating significant value for shareholders. Mark is the right person to
continue our turnaround plan and lead Campbell to future growth. He brings a wealth of
experience in the food industry, as well as a fresh perspective on the opportunities and
challenges before us. Mark was the board’s top choice due to his success leading organizations
through significant transformations and his history of delivering strong results. We are eager to
begin working with him as we continue to build a stronger and more focused Campbell.”34
Exhibit IV
Mark Clouse – CEO, Campbell Soup Company
Source: Hilario Kenneth, “Campbell Soup Co. names Mark Clouse as its new CEO”,
https://www.bizjournals.com/philadelphia/news/2018/12/20/campbell-soup-cpb-mark-clouse-ceo-
morrison-mclaugh.html, December 20th 2018
Clouse stated, “I am honored to lead Campbell and its portfolio of iconic brands into the next
chapter of the company’s storied history. I am committed to delivering Campbell’s strategic
objectives and look forward to partnering with the Board and working alongside the
company’s many talented employees to deliver sustainable, long-term growth. I am confident
that together we can build a prosperous future for Campbell and all of its stakeholders.”
Vinney added, “I want to thank Keith McLoughlin for his service asCampbell’s interim CEO
during this important time. Under Keith’s steady leadership, we have made significant progress
in focusing the company, increasing operational discipline and executing our plans to improve
performance. The Campbell turnaround has begun, and the company stands well positioned
for success as Mark steps into the CEO role. I look forward to continuing to work with Keith as
an active member of Campbell’s Board.”35
The company considered many other candidates like Luca Mignini (Campbell’s COO) and Jorge
Mesquita who was the Executive Vice President at Johnson & Johnson for the post of
Campbell’s CEO position but chose Clouse over them. Industry analysts viewed that ‘Campbell
needed a CEO with qualities that mimic Apple.’ Thomas Fung, Assistant Professor of Marketing
and Supply Chain Management at Temple University’s Fox School of Business stated, “The next
CEO at Campbell would need to hone a different set of core competency that could effectively
identify consumers' current needs — and anticipate their future desires, before they realize
that they could never live without products yet to be manufactured.”36
34 Springer Jon, “Campbell Soup Taps Mark Clouse as CEO”,
https://www.winsightgrocerybusiness.com/cpg/campbell-soup-taps-mark-clouse-ceo, December 21st 2018
35 “CAMPBELL NAMES MARK A. CLOUSE PRESIDENT, CHIEF EXECUTIVE OFFICER AND A DIRECTOR OF THE BOARD”,
https://www.campbellsoupcompany.com/newsroom/press-releases/campbell-names-mark-a-clouse-president-
chief-executive-officer-and-a-director-of-the-board/, December 20th 2018
36 “Campbell Soup Co. names Mark Clouse as its new CEO”, op.cit.
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Management CV37 stated, “We don’t think CEO-elect Clouse (who starts on Jan. 22) will be a
panacea for the many problems that Campbell’s faces, but he is a seasoned hand who should
be able to clarify the strategy and make some quick capital allocation changes that will benefit
all shareholders. We think the new CEO’s heavily performance oriented pay package will focus
on him shedding people and inefficiencies to refocus the firm on its core soup business. Clouse
is the right person for the tasks of optimizing the company’s portfolio, paying down debt, and
becoming a more “focused” company, goals laid out by Keith McLoughlin, Campbell’s interim
CEO.”38 According to analysts at Stifel39, “… Mr. Clouse brings an outsider’s perspective to
Campbell Soup and while the lifting will be heavy, we believe he is best positioned to
undertake this turnaround.” Stifel further added, among the challenges faced by Clouse, were
the divestiture of various brands like Garden Fresh and Bolthouse Farms, and the integration
of Snyder’s Lance.40
Clouse also had to lead the company in transition in a time when the board pursued to divest the
Campbell Fresh business units and the Campbell International.41 Besides this, the food industry
was pushed hard to innovate continuously and adapt to the changing customers tastes. Campbell
was facing several uncertainties over a period of time, wherein at one point of time it was on the
verge of selling out the company. Analysts viewed that Clouse’s extensive experience and in-
depth knowledge about the industry would come to the rescue of Campbell. Secondly, resolving
the problems at Campbell depended upon the ability of Clouse to deal with the activist investors
who had been closely following the crisis at Campbell and were worried about ‘the soup maker’s
unimpressive financial performance in recent quarters and mounting debt’.42
In 2019, Campbell witnessed ‘better-than-anticipated earnings’ which was appreciated as a
positive move on the appointment of Clouse. Campbell noticed increase in net sales with $2.71
billion. In addition to this, the profits excluding some items reached to 77 cents per share in the
second quarter ended in January 2019, which was more than predicted estimates. Under the
leadership of Clouse, Campbell undertook various plans to revive the brand.43 (Annexure II).
Other than this, Campbell planned to sell the Bolthouse Farms business to equity firm Butterfly
Equity for $510 million to lessen the debt of the company. Clouse stated, “The sale of Bolthouse
Farms supports our strategy to focus on our two core North American businesses, Campbell
Snacks and Campbell Meals and Beverages.” Upon completion of the deal the company would
divest the entire fresh division. The company also made an agreement to sell its Garden Fresh
Gourmet44 to an affiliate of Fountain of Health USA45 for an undisclosed amount.46
37 Management CV is a pioneer in applying statistical science to evaluating the skill and quality of management.
38 Garcia Tonya, “Home Industries Campbell Soup’s new CEO led flagging Pinnacle Foods, but analysts are
upbeat”, https://www.marketwatch.com/story/campbell-soups-new-ceo-led-flagging-pinnacle-foods-but-
analysts-are-upbeat-2018-12-28/, January 2nd 2019
39 Stifel Financial Corp. is an American multinational independent investment bank and financial services
company created under its present name in July 1983 and listed on the New York Stock Exchange on November
24, 1986.
40 “Home Industries Campbell Soup’s new CEO led flagging Pinnacle Foods, but analysts are upbeat”, op.cit.
41 Nunes Keith, “Mark Clouse to lead the Campbell Soup Co.”, https://www.foodbusinessnews.net/articles/13065-
mark-clouse-to-lead-the-campbell-soup-co, December 21st 2018
42 “A tough task awaits Campbell Soup’s new CEO Mark Clouse”, op.cit.
43 “Campbell Shares Rise After Earnings Beat Estimates Under New CEO”, op.cit.
44 Founded in 1998 and acquired by Campbell in 2015, Garden Fresh Gourmet is the No. 1 branded refrigerated
salsa in the U.S. Garden Fresh Gourmet also makes, sells and distributes hummus, dips and tortilla chips both
under the Garden Fresh Gourmet brand and private label products. Garden Fresh Gourmet is located in Ferndale,
Michigan, and also has operations in Grand Rapids, Michigan.
45 A maker of hummus, dips, variety packs, prepared salads, pâtés, and frozen desserts.
46 “Campbell to sell Bolthouse Farms for $510 million”, https://ca.finance.yahoo.com/news/campbell-sell-
bolthouse-farms-510-173713681.html, April 13th 2019
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Although Campbell made various efforts, the company faced a number of challenges related to
millennials. The major problem with the millennials was that they did not appreciate the food
brands which were liked by their parents. The millennials liked environment friendly packaging
and ‘non-GMO foods without preservatives’, which consisted of natural ingredients or ethnic
variants, preferably fresh and organic. According to Erik Gordon (Gordon), Professor, The
University of Michigan’s Ross School of Business, “Campbell Soup’s challenges begin with its
classic red-and-white soup cans that are a fixture of the middle aisles of supermarkets.” He
further added, “That [product] is full of high fructose corn syrup and stuff that young people
hate. They need to get that executed correctly because that business is getting eaten alive by
cheaper brands, store brands and non-labeled brands.” “So Campbell’s has to get it right with
the younger people — its future — and with the people [in the older generation] that still are
its bread and butter and the bulk of its sales. So far, it’s getting it wrong with everybody”,
stated Gordon.
Jason Riis (Riis), Marketing Lecturer, Wharton and Gordon expressed their sympathy with
Campbell soup of not being able to connect well with millennials and stated that it was very
difficult for companies to make strategies for them. Riis drew the example of millennials, many
of whom preferred non-GMO foods. Riis stated, “However, GMO foods are not shown to be
any less healthful than the non-GMO ones and yet consumers still crave then. So to what
extent do you go after a consumer who’s both potentially a moving target and a target that’s
not even tracking the right things for what they supposedly care about, which is downstream
health?”
Gordon also emphasised on Campbell to get its partnership strong with Walmart and Kroger.
Gordon stated, “It is Mass Marketing 101 that you have to keep those relationships right. You
have to have the right shelf space, and the right promotional coordination, or else you’re really
dead.” Although there were many difficulties, Riis and Gordon suggested some ways for
Campbell to get back on track. Riis said that Campbell could promote soups as a weight loss
product. “One of the biggest consumer concerns with respect to health and eating is weight
loss, and there, soup is great, because calories by volume tend to be relatively low. They could
be more proactive in that health storytelling than they currently are, rather than just giving in
to consumer whims,” he said. The duos further suggested promoting soup as a breakfast
alternative but at the same time were apprehensive about the success in changing the
breakfast habits of customers.
Besides this, Gordon suggested to introduce single pack soups. Gordon stated, “Single-pack
soups that you can toss into a microwave are a great afternoon snack.” Gordon also suggested
that even though the millennials disliked the cans and treated them as old fashioned
packaging, ‘you can preserve things via the canning process without preservatives’. Gordon
further added that while cans might be looked upon as environmentally unfriendly, Campbell
had come up with innovative aseptic packaging. He further suggested that the company could
use cardboard and other recyclable materials.47
However, Clouse was optimistic about the revival of the company, which owned great brands
that could be managed with discipline on the cost aspect and expected the ‘high-powered’
management team to bring the company back on the growth track. Clouse stated, “When you
come into an organization that has had a relatively difficult past couple of years, sometimes
you might expect to see a team that might be hanging their heads or feeling a little bit ‘woe is
47 “Can New Strategies Keep Campbell Soup from Going Cold?”, op.cit.
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me.’ I’ve got to be honest. I’ve seen a very different attitude. It’s a passionate ownership for
the company and the brand, a true belief that we should be performing better.”
Clouse opined that, ‘the biggest surprise so far about Campbell was the strength of its snack
business, centered on the newly acquired Snyder’s-Lance Inc. According to him, the unit
‘should be able to grow more quickly than the low single-digit percentage gains’ it was
currently recording. He further added that, the company had been struggling for many years in
its core soup business and this required a “much more holistic and comprehensive approach”
based on the knowledge of its soup business in the industry. He also hinted at adding new
formats and occasions that envisaged a bigger role for soups.48 Amidst this backdrop, it
remained to be seen whether the turnaround plans undertaken by CEO Mark Clouse would
help Campbell in reviving its past glory in the coming years.
Annexure I
Brief Introduction of Mark A. Clouse – President and Chief Executive Officer
Mark A. Clouse was President and Chief Executive Officer of Campbell Soup Company.
He was named to the role effective January 22, 2019, making him the 14th leader in the
company’s 150-year history. Campbell is a leader in soup, snacks and simple meals, with
iconic brands such as Campbell’s, Pepperidge Farm, Goldfish, Milano, Snyder’s of
Hanover, Lance, Kettle Brand, KETTLE Chips, Cape Cod, Snack Factor Pretzel Crisps, Late
July, V8, Prego, Pace, Swanson and Pacific Foods, among others.
Mark has more than two decades of experience in the food industry, including senior
management positions at Fortune 200 companies with iconic center-store brands,
including Mondelēz International and Kraft Foods Inc. Most recently, during Mark’s two-
and-a-half-year tenure as CEO of Pinnacle Foods, the company consistently grew or
maintained market share in each of its top categories, delivered double-digit adjusted
EPS growth, and successfully integrated the Boulder Brands acquisition creating
significant shareholder value.
Mark joined Pinnacle Foods from Mondelēz, where he served as Chief Commercial
Officer and Chief Growth Officer, with responsibility for the company’s growth strategy
and key functions including corporate strategy, global marketing, global sales, and
research, development and quality.
Throughout his 20-year career at Kraft, including the subsequent transition of
Mondelēz, Mark served in a range of leadership positions managing food brands in
developed markets and entrepreneurial global businesses in emerging markets such as
Brazil and China.
Prior to joining Kraft, Mark served in the United States Army as a pilot and completed
his service as a captain. Mark is a graduate of the U.S. Military Academy at West Point
and holds a Bachelor of Science in Economics.
Source: Compiled by the Author from – “MARK A. CLOUSE”,
https://www.campbellsoupcompany.com/about-campbell/executives/mark-a-clouse/
48 “No ‘overnight fix’: Campbell Soup’s new CEO says after beating Wall Street estimates”, op.cit.
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Annexure II
Plans Undertaken by Mark Clouse for Campbell Soup
# Steps Taken by Mark Clouse to Revive Campbell Soup
The company under the leadership of Clouse planned to
1 continue to reduce costs and integrate the acquisition of
Snyder’s-Lance.
The company tried to energise Campbell’s main soup brand,
2 which had lost appeal with many consumers.
Campbell had been already refurbishing some of its business. In
addition to this, the company sold its international and fresh-
3 food divisions to focus on its core soups and snacks. The
company also decided to sell its Garden Fresh Gourmet brand
and also made a deal to sell a refrigerated soup plant.
Source: Compiled by the Author from – Shanker Deena, “Campbell Shares Rise After Earnings Beat
Estimates Under New CEO”, https://www.bloomberg.com/news/articles/2019-02-27/campbell-
shares-rise-after-earnings-beat-estimates-under-new-ceo, February 27th 2019
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1st Edition, Issue-1 The Makeover of Dharavi: Will it Change the Face of Mumbai?
The Makeover of Dharavi
Will it Change the Face of Mumbai?
Case Study
This case was written by Keka Lahiri and reviewed by Rajan Shah, Amity Research Centers
Headquarter, Bangalore. It is intended to be used as the basis for class discussion rather than
to illustrate either effective or ineffective handling of a management situation. The case was
compiled from published sources.
© 2019, Amity Research Centers Headquarter, Bangalore.
Website: www.amity.edu/casestudies/
No part of this publication may be copied, stored, transmitted, reproduced or distributed in
any form or medium whatsoever without the permission of the copyright owner.
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1st Edition, Issue-1 The Makeover of Dharavi: Will it Change the Face of Mumbai?
Author: Keka Lahiri
The Makeover of Dharavi: Will it Change the Face of Mumbai?
Abstract: Dharavi, one of the largest slums of Asia was located in Mumbai’s two main suburb
lines - the Western and Central Railways. A home to million people, the slum exemplifies the
‘real life’ of drudgery in Mumbai. Redevelopment initiatives of the slum were undertaken in
the past with little success as there were several socio-economic constraints affecting the
viability of the project. Experts opined that, location of Dharavi was in a contrasting landscape
which had made the redevelopment work difficult. Nevertheless, occupying a large stretch of
land and having a maximum living density within, Dharavi posed major threats to the state’s
economy. In 2018, SecLink, a Dubai-based infrastructure firm was entrusted with the work of
developing the infrastructure of Dharavi. An empowered committee was formed to handle the
administrative process of project implementation. The project for revamping Dharavi was
understood to be ‘one of the biggest brownfield development projects’ in the Indian economy.
Feasibility of the project was scheduled through bringing in an inclusive growth within the
defined area of the slum. Although the news related to Dharavi’s makeover had stirred fear
amongst the masses, the project was thought to make space for an affordable supply of
housing units in Mumbai. Whether the slum improvement project could give a facelift to the
business capital of India remained to be a point for discussion.
Case Study
“'Slumdog Millionaire' is a fairy tale, but it starts in a place you really believe, and that came
from spending two months wandering around the slums picking up stories and talking to
people.”1
– Simon Beaufoy, Famous British Screenwriter
Once again in mid-2018, the makeover of Dharavi, one of the largest slums in Mumbai was
declared. The responsibility of the bid for the makeover project was won by SecLink, a
Dubai-based infrastructure firm. The company had won the project of developing the 2.40 km2
of the land which was located in the heart of Mumbai, the business capital of India. SecLink
had been a known brand in the global market and was known to be backed by the 'royal family
office of the Middle East’. In order to implement the bid, a committee was formed and the
senior officials of the state stated that, a Memorandum of Understanding (MoU) was signed
between the State Government of Maharashtra (GoM) as well as Dharavi Redevelopment
Project Authority (DRPA). This was done in order to successfully execute the project.
Experts had admitted that, the makeover project was to be executed the estimated cost of
which was understood to be $37 billion approximately. This project was acknowledged to be
1 https://www.brainyquote.com/quotes/simon_beaufoy_892915?src=t_slums
“© 2019, Amity Research Centers HQ, Bangalore. All rights reserved.”
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1st Edition, Issue-1 The Makeover of Dharavi: Will it Change the Face of Mumbai?
one of ‘the biggest brownfield development projects’ in the country. At the same time, the
project was thought to make space for innumerable small business projects in order to define
the commercial viability. However, while addressing the need for Dharavi makeover, experts
had clearly acknowledged that, there were several advantages related to the outcome. The
makeover project was thought to give rise to 0.05 billion sq. ft. of space, which could be used
commercially. Keeping in mind the business outcomes, Sanjay Kumar (Sanjay), the additional
Chief Secretary of Housing Development, GoM, had acknowledged that, “Seclink’s bid has
been finalised. An official announcement in this regard will soon be made.”
Interesting to the above, the makeover attempts of Dharavi in the past were failed due to
several socio-political constraints. As a matter of fact, the GoM had decided to put in place a
Special Purpose Vehicle (SPV) in order to officialise the project. Simultaneously, the GoM had
declared several incentives in order to promote the makeover.2
Mumbai: The City of Contrasts
While flying to Mumbai International Airport, located in Mumbai, India’s financial hub, the first
thing that people noticed from the aircraft was the corrugated structures penetrating the city’s
landscape. Such irregular structures of construction do remind that ‘nearly half of the
population lives in slums’. As per the statistics, it had been endorsed by the experts that,
during the year 2016, from the total population of 12.44 million, almost 42% of the population
in the city of Mumbai, lived in slums. Such slums had been identified to be illegal structures
giving space to the inhabitants without ownership. These slums were understood to be
dangerous in terms of posing health hazards and causing pollution to the environment.
Unfortunately, with the increasing population, in the city of Mumbai, the slum dwellers’ had
also significantly increased.3 (Exhibit I).
Exhibit I
Slum Dwellers in Different States of India
Source: “Slum Population in India”,
http://www.indiaonlinepages.com/population/slum-population-in-india.html
Interestingly, as per the Government of India (GoI), the population residing in slums had
exceeded the population of Britain. Supporting this, as per the census of 2001, ‘the slum-
2 Tiwari Neeraj, “Dubai-based firm bags Dharavi makeover project”, https://indianexpress.com/article/india/dubai-
based-firm-bags-dharavi-makeover-project-5572822, February 7th 2019
3 Zhang Yue, “Building a Slum-Free Mumbai”, https://www.wilsoncenter.org/article/building-slum-free-mumbai,
May 03rd 2016
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dwelling population of India had risen from 27.9 million in 1981 to 61.8 million in 2001.’
Among various states, Uttar Pradesh, Maharashtra, Andhra Pradesh and Madhya Pradesh had
largest share of slum-dwelling population. Sociologists had acknowledged the fact that,
Mumbai would host approximately 20 million slum-dwellers by the year 2019.4 The reason for
the growth in squatter settlements in Mumbai was attributed to poverty. It was acknowledged
that, effective change could not be brought by the GoI, especially concerning the living
standards of the masses.5
In continuation to the above, the growth of one of the largest slums in Mumbai, Dharavi, was
understood to be initiated through migration of working population. The land initially was
identified to be a wasteland which was dumped with waste. Simultaneously, the land was free
and unregulated. With the rise in migrated population in the business capital, the land was
gradually developed to form scattered informal settlements. With an interesting mix of the
population, and a rising pressure on the land, Dharavi was extended in the midst of the city.
(Exhibit II).
Exhibit II
Scattered Informal Settlements (Slums) in Mumbai: A Snapshot
Source: Zhang Yue, “Building a Slum-Free Mumbai”,
https://www.wilsoncenter.org/article/building-slum-free-mumbai, May 03rd 2016
It was interesting to note that, ‘the Maharashtra Slum Areas (Improvement, Clearance and
Redevelopment) Act, 1971’ was passed in order to initiate the process of formalisation of
Dharavi. Simultaneously, in the same year, the improvement work of Dharavi was initiated.
Consequently, the sewerage and water lines were laid. In addition to this, transit camps were
built in order to accommodate the rising number of slum-dwellers. In 1976, photo-passes were
issued to the families residing in Dharavi and at the same time, ‘people were provided with
taps, toilets and electrical connections as part of slum improvement measures.’6
By mid-2016, Dharavi had developed into a complex structure very often referred as 'a city
within a city’. Interestingly enough, slum-dwellers in Dharavi, also included middle-class
population with excellent education background who were not in a position to afford house in
city area. Housing industry professionals had acknowledged that, since the independence of
India (in 1947), absence of well-articulated policy framework had promoted a housing supply
4 “Slum Population in India”, http://www.indiaonlinepages.com/population/slum-population-in-india.html
5 “10 facts about Poverty in Mumbai Everyone should know”, https://borgenproject.org/tag/mumbai-slums, May
2018
6 “Growth History: History of Growth of Slum in Dharavi”, https://sra.gov.in/page/innerpage/growth-history.php
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shortage in the city of Mumbai. The authorities had failed to create a favourable environment
which supports construction of large scale houses in line with the growing population.7
Consequently, as on July 2018, approximately about 6.5 million people in Mumbai used to live
in slums. As a matter of fact, slums in Mumbai occupied almost 12% of the total area of the
city. The growth of the slums in Mumbai, had promoted dismal conditions, and had given rise
to a ‘thriving informal economy’. Dharavi was a perfect example of such informal economy and
was estimated to have a huge population. Identified to be one of the largest slums in Asia, the
slum was located in a contrasting landscape.8 (Exhibit III). This was referred to as one of the
most ‘coveted real estate zones in the world’.9
Exhibit III
Dharavi Slum in Mumbai – Location
Source: “Life in a Slum”,
http://news.bbc.co.uk/2/shared/spl/hi/world/06/dharavi_slum/html/dharavi_slum_intro.stm
Moreover, in an interesting development, Jorge Mañes Rubio, A Spanish artist visited Dharavi
in 2011. He was so fascinated after visiting Dharavi that he had expressed his interest to create
a ‘Design Museum Dharavi’. On such development, he had acknowledged that, “Despite the
tough conditions the people of Dharavi live in, they are capable of creating, designing,
manufacturing and commercialising all kinds of goods.” He further added that, “We believe
that the objects made in Dharavi could be as valuable as those collected by design museums.”
In continuation to the above, Anand Giridharadas (Anand) a reputed journalist in New York
Times had named Mumbai as ‘The City of Paradox’. In fact, Mumbai was understood to be a
juxtaposed landscape of skyscrapers coupled with slum-dwellings. But, there had been sincere
initiatives taken in the past, in order to revive the slums of Mumbai. Dedeepya Reddy, who
started ‘The Chal Rang De Movement’ (in English, ‘let’s colour for a change’) had identified
such slums to be ‘real life spaces’. According to her, such slums posed real time reflections on
the lives of the inhabitants.
7 “Building a Slum-Free Mumbai”, op.cit.
8 Srivastav Sapna, “Mumbai Slums! An intriguing tale of despair and hope”,
https://www.freepressjournal.in/mumbai/mumbai-slums-an-intriguing-tale-of-despair-and-hope/1323130, July
27th 2018
9 Joshi Siddhartha, “DHARAVI IN MUMBAI - ASIA'S SECOND LARGEST SLUM IS A WORLD OF ITS OWN!”,
https://www.sid-thewanderer.com/2017/05/dharavi-mumbai-travel-guide.html, May 26th 2017
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Meanwhile, the rising number of slums in the city of Mumbai had affected the brand image of
the city. (Annexure I). In view the above, various NGOs and volunteer organisations had
worked in collaboration to improve the quality of lives in slums.10 Despite such initiatives
undertaken for development, industry professionals had acknowledged that, the situation in
Mumbai was hopeless. This was more so, endorsed by the fact that a huge slum population
had no clear access towards basic amenities which included ‘water, sanitation, power’ and
other related facilities. Issues identified with the growth of the slums included rise in the
number of infectious diseases. It was estimated that, children in slums had low school
enrolment rate as majority of them were found to be illiterate.11 (Exhibit IV).
Exhibit IV
Population Demographics in Mumbai: A Snapshot
Source: Ratan Neel, “These are the challenges faced by India’s urban poor – and how we can solve
them”, https://www.weforum.org/agenda/2016/04/these-are-the-challenges-faced-by-india-s-urban-
poor-and-how-we-can-solve-them, April 8th 2016
Contradictorily, as per data available from various sources, it was understood that, Dharavi
accounted to be one of the most literate slums with a literacy rate of 69%. Having an
estimated population of 1 million people, Dharavi hosted approximately 5,000 businesses in
association with 15,000 single-room factories. Fast growing population in Mumbai had given
rise to massive ‘ghettoization’.12 It was interesting to note that, a fast growth was occurring in
some of poorest areas of Mumbai.13 Experts opined that, while the GoI had taken big strides
10 “Mumbai Slums! An intriguing tale of despair and hope”, op.cit.
11 Ratan Neel, “These are the challenges faced by India’s urban poor – and how we can solve them”,
https://www.weforum.org/agenda/2016/04/these-are-the-challenges-faced-by-india-s-urban-poor-and-how-we-
can-solve-them, April 8th 2016
12 A ghetto denotes an isolated and underprivileged urban area. The process of ghettoizing (a group): the
segregation/isolation of a group and placement of that group into a figurative or literal position of little power.
13 “Mumbai Population 2019”, http://worldpopulationreview.com/world-cities/mumbai-population, March 30th 2019
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towards improvement of slums, private partnerships were also necessary in bringing about the
change. But, at the same time, it was important to note that, environmental considerations
were also to be included. Therefore, it was clear that, GoI had to build up an enabling
environment.14
In the process of creating an enabling environment, Dharavi’s future was locked in a stalemate.
During 2014, Mumbai’s Urban Design Research Institute (UDRI)15 had put up a demand for
gaining equitable development on behalf of the slum. This required addressing complicated
issues related to ‘housing, work, health and sanitary systems’ etc.16
In due course, the GoM had plans to redevelop Dharavi. Plans were nurtured in order to
develop Dharavi into a modern township. Dubai-based organisation, SecLink was drawn for the
purpose17 and the cost of the project was estimated at $2.1 billion (£1.1 billion).18
Will Dharavi’s Makeover Transform Mumbai’s Landscape?
In 2012, Prithviraj Chavan (Chavan), the then Chief Minister of Maharashtra, announced the
redevelopment project of Dharavi. Considering the re-development project, Sector 5 area of
the slum was the first to be addressed. It was acknowledged that, a global tender was being
called to develop the project. At this point, different options were being considered in order to
make the redevelopment project viable. “We are studying all possible options like inviting
global tenders and offering free FSI to developers for constructing the houses for Dharavi
residents or, as some non-governmental organizations have suggested, allowing the residents
themselves to build houses for themselves, etc.” said Chavan.19 Interestingly however, the
redevelopment Dharavi had been planned under ‘Dharavi Redevelopment Project’ in 2004.
But, as a matter of fact, there had been several slum improvement projects undertaken during
1972, 1976, 1985 (Slum Upgradation Project) and 1995 (Slum Rehabilitation Scheme)
respectively. Although such projects aimed to bring in improvisations, Dharavi failed to get a
facelift.20
Unfortunately, the past projects related to revamping Dharavi had failed to attract bidders, as
it required huge investments. As a matter of fact, the revamp of Dharavi required about 55,000
families to be dislocated. The GoM had declared that, each of the beneficiaries would get an
apartment sized ‘350sq-ft flats’ after the revamp process was completed.21 (Exhibit V).
14 “These are the challenges faced by India’s urban poor – and how we can solve them”, op.cit.
15 It is an independent organisation advocating for more equitable development in its home city, put the problem to the
global community.
16 Carr Carlin, “The best idea to redevelop Dharavi slum? Scrap the plans and start again”,
https://www.theguardian.com/cities/2015/feb/18/best-ideas-redevelop-dharavi-slum-developers-india,
February 18th 2015
17 “Mumbai: Dharavi revamp project to be taken up by Dubai-based firm”,
https://www.freepressjournal.in/mumbai/mumbai-dharavi-revamp-project-to-be-taken-up-by-dubai-based-
firm/1293737, June 11th 2018
18 “Life in a Slum”, http://news.bbc.co.uk/2/shared/spl/hi/world/06/dharavi_slum/html/dharavi_slum_intro.stm
19 Gadgil Makarand & Nandy Madhurima, “Chavan announces first phase of Dharavi redevelopment project”,
https://www.livemint.com/Politics/plV4yoBquwdgmA914xhQOO/Chavan-announces-first-phase-of-Dharavi-
redevelopment-projec.html, January 4th 2012
20 Bose Mrityunjay, “New makeover plan for Dharavi: will this one succeed?”,
https://www.deccanherald.com/opinion/panorama/new-makeover-plan-dharavi-will-700596.html, October 30th 2018
21 Pillai Sagar, “Dharavi makeover: Fresh bid to revamp Asia’s biggest slum”,
https://www.freepressjournal.in/mumbai/dharavi-makeover%E2%80%88fresh-bid-to-revamp-asias-biggest-
slum/1154102, October 15th 2017
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Exhibit V
Makeover of Dharavi: A Snapshot
Source: Suryawanshi Sudhir, “Dharavi redevelopment project to change face of Mumbai's real estate”,
https://www.dnaindia.com/mumbai/report-dharavi-redevelopment-project-to-change-face-of-
mumbai-s-real-estate-2676113, October 17th 2018
In late 2018, industry experts had opined that, Mumbai’s real estate prices were likely to come
down in the future years and this was to increase the opportunities for housing units to be
made available. Experts had predicted that, between FY2018-22, nearly 0.7 million 2BHK
houses to be made available to Mumbai’s rising population. In this context, Prakash Mehta
(Prakash), Minister of Housing, Labor and Mining, the GoM had stated that, "Dharavi is a
dream project, and it will generate over 5 crore sq. ft. construction space, worth roughly 60-
80,000 housing units. The rehabilitation cost of this project run over Rs 22,000 crore. We are
committed to bringing the down the soaring housing prices by 25-30 per cent.”22 (Exhibit VI).
Exhibit VI
Distribution of Living Spaces in Mumbai: A Snapshot
Source: Bhatnagar Sandip, ‘The World's Most Paradoxical Real Estate Market Is In India?”,
https://www.proptiger.com/guide/post/the-worlds-most-paradoxical-real-estate-market-is-in-india-
infographic
22 Suryawanshi Sudhir, “Dharavi redevelopment project to change face of Mumbai's real
estate”,https://www.dnaindia.com/mumbai/report-dharavi-redevelopment-project-to-change-face-of-mumbai-
s-real-estate-2676113,October 17th 2018
Page – 99
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