Ocado.pdf - What is the case about The marketing marketing...

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- What is the case about - The marketing marketing issues probs - What would you do as a marketing manager - Ocado was the world’s largest pure online player in the online supermarket grocery delivery business Business strategy: not to expand too quickly in order to not spend too much before seeing sales like “Webvan” There was a shift in customer group/target audience= from those who can afford the luxury of online delivery charge for their groceries, to customers to have found the value of ocado as they gain more groceries for less than traditional supermarket competitors, even after their delivery charge. → customer demand is strong One of the founders, Steiner, doesn't believe that after the company began to make profit in 2015, that they are in clear sailing, bc of the competitive UK market. Steiner began to formulate a global strategy. 1 . Can replicate the ocado brand and operating model in other countries 2 . But he believed the better approach was leasing the company’s know-how, under this concept so retailers who wanted to be available on line can use the “Ocado Smart Platform” with Steiner's belief of Ocado being the SAP of grocery retailing. (SAP= Systems Applications and Products in Data Processing) Industry observers we not supportive as ocado’s stock price varied with day-to-day developments- they were not in a steady or stable position to implement this Grocery retail under threat UK Market= mature and highly concentrated, the top 4 chains holding around 60% market share, sales we were declining due to cut prices to maintain market share ALDI and Lidl Shopping behaviour was changing. People were buying fewer and taking less trips Online grocery market Consumer enthusiasm helped grow online grocery by more than 10% in 2014. And almost 60% since 2009. This was impressive but they are significantly behind the growth in broader internet retailing. Tesco had a greater presence of 40% of market space. Their online orders were filled from online brick and mortar stores (fee for delivery, click and collect, and home delivery, drive thru collection points). In 2014, Ocado was the world’s largest online-only grocery retailer with revenue of £948.9 million, EBITDA of £71.6 million, and 8,500 employees. They were recognised a world leader in the automation of online order fulfillment, making more than 8.5 million deliveries per year to its 453,000 active customers, and achieving 99.3% item accuracy and 95.3% on-time delivery The Ocado Model
Customer Experience Customer were drawn to Ocard due to many reasons; WOM, their colourful trucks delivering to neighbours, but many cams bc of dissatisfaction with competitors. Tailored customer experience- so if a customer types cereal, their previous purchases would be at the top.- learn a customer's product and brand preferences The customer could keep this order open until the submission deadline was reached and add to it over the course of the day, or week The customer was then offered a selection of one-hour delivery windows

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