Careem: Mobilizing a Solution to a ProblemCareem, the Middle Easts first and leading taxi booking app$-$based service, was created as aresult of two entrepreneurs attempts to solve a region wide problem. Mudassir Sheikha, a$39-$year old Stanford educated Pakistani, and his Swedish colleague Magnus Olsson travelledextensively in their capacity as consultants for McKinsey & Company. During their travels tothe Middle East and North Africa $($MENA$)$ region, they struggled to find an easy, quick,efficient, and reliable means of transportation. It also quickly became apparent that althoughUber had provided a great solution to commuters needs in many markets around the world,it had not yet entered MENA region, and this presented an attractive opportunity. Inspiredby the global transformation of taxi$-$booking services and recognizing an under servedmarket, the two$-$tech savvy consultants launched Careen in the city of Dubai, the United ArabEmirates, in $2012.$ Although Careem was initially launched for business customers, thecompany soon found that its users were booking rides for personal use, like airport trips,schools drops, and pick$-$ups.Expanding RegionallyCareem is touted as one of the UAEs most successful start$-$ups, with growth of $30$ percentmonth on month. Within five years of its launch, it has expanded to $60$ cities across $11$countries, claims over $10$ million registered users, and has over $250,000$ contract drivers.Careem has ambitious plans to become leading transporter of people and things in theMiddle East. With car ownerships as low as $2$ to $5$ percent in some countries and a largepopulation of $700$ million people in the region, there is a potential of between $150$ millionand $200$ million trips a day a huge opportunity for Careem.Taking the Home AdvantageAs a homegrown player, Careem has unmatched insight into the regions consumers,topography, infrastructure, neighborhoods, roads, and local commuting needs, allowing itto quickly act on the opportunity to develop better maps than and have a competitiveadvantage over Uber. Many cities and their neighborhoods in the region were inadequatelycovered by Google Maps and Nokia Maps, so Careem sent its own team to build a locationdatabase. The brand name, which means generous in Arabic, also worked very well withthe local consumers.Playing the Local FavoriteClose familiarity with the cultural and traditional values helped Careem to serve theregional markets well. In Saudi Arabia, where women were banned from driving untilOctober $2017,$ Careem had a massive female following, making up nearly $80$ percent of itscustomers. It even introduced a pre$-$booking facility for women so they could convenientlyplan their trips. In Dubai, Careem launched its Ameera services, a ladies only ride with awoman chauffer. In September $2016,$ in Saudi Arabia, Careem offered a special serviceduring Eidul Adha, a popular Muslim festival during which an animal, usually sheep or agoat, has to be sacrificed and distributed to family, friends, and the poor. This requires tripsto farms, where they are sacrificed and then brought home. Careem offered to provide thisservice: its drives got the animal, sacrificed it for the customers, and brought it tocustomers homes according to the tradition. In situations where customers wanted the liveanimal to be transported to their homes, Careem arranged for pick$-$up vehicles for that too.Dealing with the RivalryUber entered the Middle East market in $2013$ as a global brand with international appeal,changing the competitive dynamics in a growing market that presented an attractiveopportunity. Both Uber and Careem adopted competitive strategies to capitalize on thatopportunity. Careem already had a strong hold on the market due to its first$-$moversadvantage and local orientation. Due to its global dominance, Uber was able to raise $$15$billion in venture capital compared to $$425$ million that Careem had raised. Faced with achanging competitive scenario and an aggressive opponent, Careem focus on providingmore localized solutions to the region, including better maps, pre$-$booking services,dedicated call centres, and a varied fleet. Careem claims that over services operate only as alimo service, but it offers a different ride experience for everyone. For example, in Dubai,Careem offered different types of rides: Economy, Business, Careem Kids, MAX, First Class,and Ameera. While uber seeks global dominance, Careem is concentrating on being aleading regional player with a strong focus on local needs and wants.Source: Adapted from Entrepreneurship: Successfully Launching New Ventures, PearsonEducation $2019.$Question $1$a$)$ Identify the market gaps that Sheikha and Olson filled by launching Careem in the MiddleEast. $(3$ Marks$)$b$)$ What role did their personal commuting experience in the region play in identifying theopportunity? $(2$ Marks$)$c$)$ How being a local player helped Careem to cater the needs of users in the region? Whatfactors have contributed to its regional popularity? $(5$ Marks$)$d$)$ As the taxi$-$booking segment matures in the Middle East, how relevant will factors likeinnovativeness and first$-$movers advantage to be sustainable and continuous success? $(5$Marks$)$e$)$ Considering the strong competition from the global leader, Uber, do you think Careem willbe able to maintain its market positioning in the region? $(5$ Marks$)$f$)$ In what ways do you think Careem can contribute to the local economies? $(5$ Marks$)$Once the task is completed, Make a Submission.