Reference no: EM133199832 , Length: 35 pages.
Assignment: Instacart and the new wave of Grocery Startups- Case Analysis
To help with your critical thinking:
• Understand the situation, from the viewpoints of the environment, competition, and the company's internal resources
• Position alternative courses of action.
Synopsis
Based on a variety of metrics, Instacart especially during the early months of the pandemic has thrived. At the core Instacart's business model integrates e-commerce, on-demand, sharing, and subscriptions.
The Case was written in 2018-obviously prior to the pandemic. Your role as part of the lead Marketing Consulting Team is to assist the company move their business forward for the next two-three years-especially post-pandemic. Can the company sustain their current success? Home grocery delivery business entrepreneurs have been trying to solve and provide Internet-based solutions since the earliest days of what was called the consumer Internet. One of the most well-known businesses is/was Webvan, founded in 1996, and unfortunately bankrupt by 2001, and considered in the industry as one of the biggest "flops" of the first wave of dot.com businesses.
As you will read in the Case, when the Instacart business was founded there were clearly challenges and most importantly opportunities of what has been termed the "last mile" distribution of groceries in the digital age, and the potential for platform-based/flexible worker solutions.
The central question posed by the Case is whether Instacart's personal shopper-powered, app-based model can succeed where businesses like Webvan, as well as host of more recent on-demand delivery businesses, have failed?
A second question is how Instacart's prospects have changed since Amazon entered into the offline grocery business with its acquisition/diversification growth strategy of Whole Foods and its almost 500+ stores. When the Case was written Whole Foods was one of Instacart's partners; however the end of 2018 Whole Foods announced it would no longer be working together with Instacart. The move/change came a little over a year after Amazon acquired Whole Foods for $13.7 billion. Amazon has its own delivery service called Amazon Fresh. (FYI--Whole Foods and Instacart began working together in 2014. Two years later, they signed a deal for Instacart to become the chain's exclusive delivery carrier).
As part of your analysis/critical thinking is to identify the changes since early 2000's (many that caused Webvan to fail) that have altered the landscape of the industry. Are these changes enough to lead to a sustainable business model for Instacart? As you will read in the Case $10.9 billion was spent in the 2018 timeframe annually on grocery buying online in the U.S. reaching just 4% of the population on a regular basis. Obviously, this number is much higher today. Could continuing investor and entrepreneur interest simply be triumph of hope over experience, or is there reason to think that Instacart has finally figured it out?
Bring into your analysis - any Corporate Components and Seven Domains Framework to support your Analysis.
Task
Questions to be answered when you submit your written analysis.
I. Why did Webvan fail? Does Instacart have better prospects for survival?
II. Is Peapod a better point of comparison to Instacart's business model? Or should Instacart be more concerned with what has been "coined" the "Amazon effect" - the disruption that happens when the Seattle e-commerce behemoth/Amazon enters a new corner of retail. Does Instacart have better prospects than Peapod and Amazon Fresh?
III. Surge pricing is an important element of Uber's demand management. Should Instacart consider a similar dynamic pricing model? Or do you support their current pricing model? (Why or Why not-the Management Team needs your thinking).
IV. As the Marketing Consultant making recommendation to the Instacart Senior Managers-you will be diplomatic with this response-not to imply the current Customer Experience Manager is not doing a good job; but if you were Instacart's Customer Experience Manager, what should be done to assess opportunities improve Instacart's user experience?
V. You know as an experience marketer if you achieve success in the industry this is a good thing for overall industry growth. Could Instacart play a part in transforming the structure of its industry as AirBnB and Uber are doing to theirs? Does Amazon's acquisition of Whole Foods factor into your thinking?
Make sure your Case Write-up includes the below: (please focus on no more than (4) double-spaced typewritten pages)
1. Executive Summary
a. Clear-Concise-Road-map leading to analysis/argument
2. Case Analysis/Argument/Recommendations
a. Market attractiveness (macro-trends)/industry attractiveness/trends
b. Who is their target market/What is their sustainable competitive advantage?
c. What is their value/differentiation/benefits?
3. Tools/Matrices
a. SWOT Analysis/Michael Porter's (5) Forces--please include as an Appendix--NOT PART OF THE (4) typewritten papers.
4. Contingency Plans--Do you need to plan for a backup plan if your competitive strategy is not working.
Attachment:- Case-Instacart-and-the-new-wave-of-Grocery-Startups.rar