El Sheikh Ali, Ali.
I. What is/are the problem(s) / challenges(s) ?
Peapod is a challenging and innovative company, that is considering entering the internet market. 2)
Therefore the company must put in place its website, and develop a strong network. 3)
Strategy, brand positioning and partners are also important challenges facing the company.
II. Company Analysis:
What is / are the business / mission / philosophy ?
The company is founded in 1989.
It provides online groceries for specific regions:
Chicago is the largest market.
It serves around 75,000 customers.
With 75% of customers being women. (56,250).
It is the first and biggest company of its genre.
It has a strong brand recognition.
It has a well established partnership with both its customers up to its suppliers. 9)
Its service is considered to be convenient and time saving.
B. SWOT Analysis:
Peapod has implemented itself and its market as the pioneers of the online grocery stores. 2)
Being the first to do so, it became naturally the leader in its market. 3)
Peapod falling stock prices served as a barrier against competition entrance into the market. 4)
Brand recognition is strong and media coverage helps maintaining “the heat”. 5)
Software programming has lead Peapod to forward a new version for online transactions: a.
It aims at reducing costs.
Having more efficient operations.
Increase the number of potential customers and markets niches. d.
It managed to financials both from the customers and from the suppliers (due to membership). 6)
Customers are satisfied because thry do not have to suffer the market stressfull experience. 7)
Prices are cheaper.
Partners support alliance with Peapod, and look forward to it. 9)
Cooking advice is available online.
Free assistance may be asked for.
Permits Peapod to have a huge data base of its customers and their buying habits. 1)
This database may be sold to other companies.
It may serve Peapod for a better marketing and advertising planning. 3)
It developped different forms of advertising such as Stimulus Response Testing or Electronic couponing. 4)
Kraft Foods and PepsiCo are able of direct advertising. 10)
A large number of women buy online.
Since an IPO (initial purchase offer) Peapod stock price has declined. 2)
The company never made a huge profit.
It suffered from negative cash flow.
The company can not propose to replace items that have stocked out. 5)
Delivery process suffers a 2% error.
Internet access it to long and unefficient.
Their is quasi no customer loyality, along high membership turnover. 8)
The number of men buying online could be extended.
Personnal computers, and laptops are being used more and more. 2)
Disposal income also increased.
From $600 million to $57 billion.
The market is expected to explode
Because most baby boomers are empty nesters they tend to buy more pre prepared food and meals. 5)
Moreover they tend to work longer, and this is also an incentive for pre prepared food. 6)
According to CommerceNet and Nielsen Media research, food and drinks along grocery items are the top selling items on the net. 7)
Due to the important capital that has to be put in place in order to open an internet website, competition is hesitant whereas to enter or not this market. a.
This gives Peapod a considerable advantage over its competition. b.
And it gives the company the opportunity to be the first entering this market. 8)
The E-commerce is exploding.
150 million people are expected to surf the web in the United States (Morgan Stanley). a.
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