Case Study 1
Submitted by: Group 2
1. Pritom Das ID: 2010458
2. Aditi Chakraborty ID: 2020116
3. Tandra Chakrabarty ID: 2021965
4. Nafisa Islam ID: 2022061
5. Samira Saba ID: 2020498
Course Name: Principles of Marketing
Course Code: MKT 201
Section: 08
Summer 2021
Submitted to:
Mr. Syed Imamuzzaman
Lecturer
Independent University, Bangladesh
Submission Date: 27th June, 2021
Summery:
Pathao is a digital on-demand platform and automobile rental firm based in Dhaka,
Bangladesh. The corporation has offices in Dhaka, Chittagong, and Sylhet, Bangladesh,
as well as Kathmandu, Nepal. With its fleet of motorcycles and bicycles, it began its
adventure as a delivery service in 2015. They provided delivery services for a number of
Bangladeshi e-commerce companies of Bangladesh. It offers ride-sharing, meal
delivery, e-commerce and courier services. Pathao is the first major ride sharing
company in Bangladesh to receive an enlisting certificate from the government.
Since the middle of the year 2019, Pathao has being laid of many of their employees.
From the article we get to know that Pathao began with a dream and a few motor bikes,
with the goal of delivering packages throughout the city. Battery Road Digital, a US-
based venture capital business that invests in ride-sharing services all around the world,
provided seed money. The company was founded in August 2016 and obtained USD
825,000 in funding from Battery Road Digital and another investor known as Sky-
catcher. It's having trouble making money. Ex-employees were laid off as a result of the
company's inability to produce money due to a lack of investment. Last month, the
company's chief operational officer sent a request for $50 million in funding. At least
76.1 percent of Pathao's drivers lack valid driver's licenses, national identification cards,
or vehicle registration documents. Between 93 and 97 percent of the company's
total fleet of registered drivers don't have any of these documents. The company is
operating blindsided because of government regulations. Pathao laid off just three
months after its closest local competitor Shohoz received Series B funding from six
venture capital firms. Pathao's marketing department spent Tk 13.8 million between
May and June on media buying, with no immediate return in the form of customers
using the company more. Pathao, a social media company in Bangladesh, is laying off
353 workers. The company has more than 1,500 employees (both permanent and
contractual) Ex-employees say Pathao hired too many people to raise money for the
next round of funding. Pathao’s wrong decision was that they didn’t spent money
wisely .After being a tech company they invested money on TV ad. Pathao's media and
TVC purchase, which accounted for 57.7% of the Tk 13.8 million spent from May to
June 15, 2019, included a television commercial featuring national cricket team captain
Mashrafe Bin Mortaza. It wasn’t a good decision for them. And lastly they hired more
employees than they need.
Impacts on Pathao:
Let's say Pathao is suffering from the effects of a recession. What happens to this
company will likely happen to other big businesses as the recession runs its course.
As deals incomes and benefits decrease, the maker will scale back recruiting
new workers.
With an end goal to reduce expenses and improve the main concern, the
maker may quit purchasing new gear.
Also curtail research and development, and stop new product rollouts (a
factor in the growth of revenue and market share).
Consumptions for showcasing and promoting may likewise be decreased.
The employees will leave their job because they will not get their salaries on
time or enough facilities and other people whoever depending on Pathao will
stop depending on them.
These are the main reasons why Pathao is losing its popularity among ride sharing
apps.
Impact on consumers:
Consumer’s safety issue as the riders are not qualified to ride.
Pathao spending more money on PR and Marketing and losing money thus they
raise the base fare for each ride where consumers have to pay more.
The customer demand will stop growing, they will start to create a bad reputation
in the business industry.
Also, people will stop using Pathao because of They are appointing non-
professional drivers. That’s why many accidents are occurring, and consumers
are facing troubles.
Problems:
Lack of experience rider
Not having driver licenses and other documents
Riders are not following proper road rules and traffic laws
Not having access to Government database
Bad marketing strategy
Spending more than they should
Investment in wrong place
Solution:
Pathao riders should have driving licenses and have to maintain traffic laws. Traffic laws
are very important because they keep people safe. While Pathao was hiring riders, they
did not cross checked all the documents. Reason behind is that, Pathao doesn’t have
any access to government database. As for solution, Pathao should go for collaboration
with government and have the proper data of their employees. If Pathao can ensure this
document verification then surely a huge part of the problems will reduce.
