Case study - Casas Bahia

1. THE
FORTUNE
AT THE BOTTOM
OF THE PYRAMID

2. Casas Bahia –Case Study
Brazilian retail chain which specializes in furniture and home appliances.
• Scope & Size of opportunity : In 2002 population in Brazil was 176 million
84% of whom are considered to be at BOP .
• Brazil’s population is divided into affluent class and lower income group.

3. • Who are the customers of Casas Bahia ?
─ Primarily maids,, cleaners, cooks, independent street vendors and
construction workers.
• Is Casas Bahia have any competition in the retail market of Brazil ?
– Yes , His main Competitors are Ponto Frio , Magazine Luiza
,Marabras etc .
• What Made him so successful ?
– His Unique Business model .
Casas Bahia –Case Study

4. Business Model
• Finance
SPC
Score
• It is a client information .
• It is either Positive or Negative .
Passbook
• It allows customer to make small installment payment for the merchandise .
• Payment scale varies from 1-15 month .
Financed
sales
• Financed sales is 90% of total sales volume .
• 6% are cash & 4% by credit card .

5. Business Model
• Reason for less default rate ?
─ No third party intervention

6. • What is the Casas Bahia marketing Strategy ?
– Company invests around 3% of its revenue on advertisement.
– Strategy is to attract customer by announcing on low price on
the branded product s.
• Media for advertising
– Television
– Radio
– Use of famous singers ,actors and television personalities for
promotion .
Casas Bahia –Case Study

7. • Future Challenges
– Use credit card by end customers.
– Catering to the new market segment .
– Competition from increasing large Hyper
marts.
Casas Bahia –Case Study