Munchery only delivers chilled food

Digital disruption in the consumer goods industry

Table of Contents

List of figures

List of tables

Attachment directory

List of abbreviations

1 Introduction

2 Theoretical Foundations
2.1 Disruptive innovations & business models
2.2 Methodology: Business Model Canvas & Business Model Navigator

3 Business model and value creation analysis
3.1 Value creation of food retail in the consumer goods industry
3.2 Business model analysis of the new entrants
3.2.1 Meal Kits
3.2.2 Online retailers
3.2.3 Influences from outside the industry
3.2.4 Business model patterns according to Gassmann
3.3 Business model analysis of the industry incumbets
3.3.1 Walmart
3.3.2 Lidl
3.3.3 Rewe

4 Future trends and developments in food retail
4.1 Industry trends
4.2 Country trends
4.3 Creation of a new value chain

5 conclusion

6 Bibliography

List of figures

Figure 1: Business Model Canvas

Figure 2: Simplified value chain of the consumer goods industry

Figure 3: Classic food retail value chain

Figure 4: Changed food retail value chain

List of tables

Table 1: Overview of the more closely examined startups

Attachment directory

Appendix 1 - Descriptive Statistics

Appendix 2 - HelloFresh

Appendix 3 - Blue Apron

Appendix 4 - Sun Basket

Appendix 5 - Chef´d

Appendix 6 - Gousto

Appendix 7 - Munchery

Appendix 8 - Freshly

Appendix 9 - Frichti

Appendix 10 - GoodEggs

Appendix 11 - GoPuff

Appendix 12 - GrubMarket

Appendix 13 - Drizly

Appendix 14 - Postmates

Appendix 15 - Instacart

Appendix 16 - AmazonGo

Appendix 17 - Amazon Pantry

Appendix 18 - AmazonFresh

Appendix 19 - Innit

Appendix 20 - Starship

Appendix 21 - Habit

Appendix 22 - Aldi (additional incumbent analysis)

Appendix 23 - Edeka (additional incumbent analysis)

List of abbreviations

Figure not included in this excerpt

1 Introduction

In the consumer goods industry, there is currently no other trend as present as shopping over the Internet. Books, media, electronics, toys and increasingly also fashion are already recording market shares of 20 to 30 percent (see HDE, 2017). New business models are changing the traditional structures of the retail sector significantly. Only the grocery trade seemed to resist this development in the past. The share of groceries bought online is, for example, in Germany, similar to other countries, dwindlingly low at 1.5% of total sales. (see PWC, 2018) With a market volume of € 183.5 million, the food retail trade (LEH) in particular is one of the largest markets still to be developed with considerable growth potential (see Graf, 2018; GfK, undated). The market has been growing by ten percent for years and is always attracting new market participants[1] on the plan. Tim Lasester, Managing Partner at PWC US, therefore suspects the food retailer to be at a tipping point. This describes a point in time up to which nothing happens for a long time, the change builds up and everything changes fundamentally in one fell swoop (see Laseter, 2017). Such relevant changes are also referred to as disruptive innovations, in which new market participants with new concepts and business models challenge incumbents and thus lead to massive changes in industries (cf. Christensen / Raynor / McDonald, 2015). Industry experts often cite the entry of the technology group Amazon into a market that is foreign to the company as a symbol of a possible imminent fundamental change in the market structures in the food retail sector. "We all underestimated how brutally Amazon will attack us" (Kolf, 2016)[2] was the verdict, for example, of Lionel Souque, CEO of Rewe, even though Amazon only launched its online and offline concepts on a test basis.

Building on these first industry observations, this thesis aims to analyze the food retail industry using selected startups and incumbents - established companies. Due to their relevance, Amazon's new online and offline concepts are also included in the analysis. The aim is to examine the business models, activities and reactions of market players and to identify trends and possible changes in the industry. In addition, the analysis should provide information on whether the value chain in the food retail trade can continue in its current form and, if not, what the future value chain could look like. Finally, the analysis should enable statements to be made as to whether the industry is being changed disruptively by new market participants.

In the first step of the work, a theoretical overview of the methodology used and the importance of (disruptive) business model innovations is given. In the second step, the value chain of the food retailer is derived and then the startups and incumbents with the Business Model Canvas (BMC)[3] analyzed. In the last step, the future development of the food retail sector is presented on the basis of the analysis results. Industry trends are derived, possible differences by country are considered, and an outlook on a possible new value chain is given.

2 Theoretical Foundations

In the following, the theoretical framework of this work is presented in order to create a conceptual understanding that is valid for this work. To this end, (disruptive) business model innovations are explained before the analysis methods used by the BMC and the Business Model Navigator are described.

2.1 Disruptive innovations & business models

In order for companies to be able to secure their competitive position in the long term, they must constantly adapt to the changing environmental conditions. This is made clear by the (sudden) disappearance of important companies in the past, such as the retailers Quelle and Schlecker, which have operated successfully on the market for years. According to Gassmann (2017), these companies have failed to adapt to changing circumstances. The ability of business model innovation, which describes the changes initiated by the company in strategy, marketing, supply chains, value creation, pricing policy or cost structure, is essential in today's world. (cf. Gassmann / Frankenberger / Csik, 2017, p. 3 ff.) While companies in the past mainly generated their growth and secured their market position through process and product innovations, this is no longer sufficient today. Increasing competitive pressure, increasing globalization and the introduction of new technologies lead to an increasing merging of industrial boundaries leading to changes and disruptions in industries. (see Christensen et al., 2015, p. 3)

Disruption describes the breaking up of an industry, triggered by new technologies and / or market participants. The basis for disruption is often that incumbents prioritize the improvement of their processes, products and services for their existing customers. Overlooked needs of other customer segments then take up new companies and address them with often cheaper and better functioning solutions. If a broad mass develops for the offer or the standard of the new market participants, one speaks of a disruption. (cf. Christensen et al., 2015, p. 4 ff.) There are new opportunities for startups to generate value and change the existing structures of an industry.

2.2 Methodology: Business Model Canvas & Business Model Navigator

In order to be able to make an assessment of the extent to which there are business model innovations or disruptive changes in the industry, a fundamental understanding of the respective business models is necessary. A suitable analysis method is the BMC developed by Alexander Osterwalder (2011). Using nine criteria - so-called building blocks - complex business models can be represented in a simplified manner and clearly related. It enables the identification of key factors of the business model.

Figure not included in this excerpt

Figure 1: Business Model Canvas[4]

Figure 1 shows the structure of the BMC. The nine modules are filled with appropriate information for the analysis. The Customer segment describes the target group of the company, their needs and problems with its benefits in the form of Value proposition encountered. channels comprise the channels used for communication, distribution and sales. Under Customer relationship it is recorded how these are maintained and designed. The incoming cash flows are under Sources of income summarized. Key partnerships, resources, and - activities describe the most important cooperation partners, goods and activities that are necessary for the production of a product or the provision of a service. The Cost structure indicates the resulting costs. The simplified visual filling of the nine segments makes it easier to understand, analyze and evaluate the business models. (see Osterwalder / Pigneur, 2011)

Another method for the simplified description of the business models is the St. Gallen Business Navigator. This is based on an empirical study by the University of St. Gallen, which shows that 90% of new business models are based on existing business models or a combination of these business models. 55 patterns - recurring patterns - which are the result of the investigation and help to describe the business models of companies, serve as the basis. (see Gassmann et al., 2017)

3 Business model and value creation analysis

The following chapter includes an analysis of the food retailing sector in the context of the consumer goods industry, with the aim of laying a sound basis for working out industry trends and possible disruptive changes. In the first step, a basic understanding of the food retail value chain is created. Then the selected 16 startups, Amazon's new activities in food retail and the incumbents Walmart, Lidl and Rewe are analyzed using the BMC and the startups are classified using the business model navigator.

3.1 Value creation of food retail in the consumer goods industry

For the following analysis, a basic understanding of the industry and value creation within it is essential.

Consumer goods are defined as material goods that directly address the needs of the end consumer and can thus be distinguished from capital goods. The consumer goods industry is characterized by a high degree of product heterogeneity. With regard to the benefit category, quality, price and brand, the goods differ greatly and can therefore be easily segmented. A central division relevant for this work is made into food and non-food. (cf. Koch, 2006, p. 155) In addition, everyday consumer goods such as food, health and beauty products, fashion and household items are referred to as Fast Moving Consumer Goods (FMCG) (cf. Beck / Kruse, 2002).

Figure not included in this excerpt

Figure 2: Simplified value chain of the consumer goods industry[5]

The simplified value chain of the consumer goods industry in Figure 2 shows retail as the last link between producer and consumer. In general, trade takes on the task of balancing spatial, temporal, qualitative and quantitative tensions between production and consumption. It is divided into wholesale and retail. Whilst wholesale is upstream of retail and addresses resellers, retailers target the private end consumer. (cf. Zentes / Swoboda / Foscht, 2012, p. 2 ff.) Consequently, companies with the aim of selling goods to private end consumers and focusing on “food” can be assigned to the retail trade. It is becoming increasingly difficult to classify food retailers clearly because the product ranges of most retailers are increasingly mixed.

While the (food) retail trade has long been said to have a non-value-creating function, significant value creation is now attributed to it (cf. Passenheim, 2003, p. 32). The extent of the added value is based on the number and quality of many individual trade services (see Committee for Definitions on Trade and Distribution, 2006, p. 27).

Figure not included in this excerpt

Figure 3: Classic food retail value chain[6]

Figure: Classic food retail value chain Figure 3 illustrates the essential retail services in the conventional food retail value chain. At the beginning of the value chain there is Purchasing of goods from producers and wholesalers as well as in-house logistics. Another main ingredient is that business of stationary sales infrastructure, consisting of branches, warehouses and the head office. Other value-creating services include Inventory management for optimal provision of the products as well as the Content creation or that marketing. The last service in the conventional food retail value chain is sales or that Cashing in. The Picking, the compilation of a desired required partial quantity, as well as the delivery of the goods is taken over by the customer. The customer has to make the purchase physically in the shop, put together the desired products and quantities himself and transport them from the market to the household. Comprehensive post-transactional customer service is not part of the classic food retail value chain. (see Koch, 2006)

3.2 Business model analysis of the new entrants

As part of the analysis, the business models are first analyzed according to the BMC and then examined with regard to the underlying patterns according to the Business Model Navigator. The aim is to work out similarities and differences in order to find out whether certain patterns can be recognized in the patterns of the new market participants and whether and to what extent the patterns differ from those of the incumbents examined.

The Crunchbase database served as the basis of the startup analysis, centering the data within the international startup ecosystem (see Crunchbase Inc., undated). In order to identify the relevant startups for a cross-section of the food retail sector, the database was filtered and initially according to the industry categories defined by Fama & French (1997)[7]which represent foods in the narrower sense[8], filtered. In order to cover sufficient relevance, active companies with a founding year between 2010 and 2015 were filtered out. In addition, all companies whose short_description, category_list and category_group_list 'Restaurant' included. This serves to exclude the catering trade and the delivery services connected to it, so that the food retail trade can be viewed separately. The resulting list comprised a total of 2305 startups, 391 of which had an investment volume of over $ 1 million. The 50 largest startups were finally examined more closely. The final list includes 16 startups, with the country codes of North American or European countries, a digital business model and a reference to retail. The startups have an average investment volume of $ 47.35 million, ranging from $ 8.25 million to $ 674.8 million, with an average of 5.5 investment rounds.[9] In the following analysis, the individual startups could be grouped and described according to their business model in different categories, namely meal kits, online retailers and influences from outside the industry.[10]

3.2.1 Meal Kits

Meal kit providers deliver boxes filled with certain foods that have been ordered online directly to customers' homes. The investment volume of the eight largest meal kit startups averages around $ 122 million. Within the meal kit models, this work differentiates between two approaches. On the one hand, there are providers who send recipes with the associated foods for self-preparation and, on the other hand, there are startups who deliver chilled ready-made meals to be heated up.

The largest meal kit providers identified in the analysis are HelloFresh, Sun Basket, Blue Apron, Chef’d and Gousto, with a range of recipe boxes. On the side of the ready-made meal boxes you will find Munchery, Freshly and Frichti. When looking at the business models, a strong similarity can be seen with differences in the target markets and niches.

The value proposition of all meal kit providers is a time saving for the customer through decimated supermarket visits and less effort in the selection of recipes. The customer only has to select the number of meals and the desired recipes online, whereby he can also be inspired by the constantly changing suggestions of the provider. Ready-meal box providers expand the customer promise by taking over the cooking process, which saves the customer even more time. The core activities of the providers are in purchasing, portioning and picking of the corresponding food, or in the preparation of ready meals.Key partners are producers and logistics partners, but also the customers themselves, who advertise the respective brand as influencers and advertising partners via social media. The most important resources of the startups include, due to the elimination of stationary sales areas, efficient infrastructures and digital resources. This includes in particular the online shops, algorithms and customer data acquired with the help of complex analysis processes.

Most of these startups offer automatic regular delivery of the order. This promotes customer loyalty and generates calculable, regular income. The most important cost items for companies include logistics, personnel and marketing costs, as well as costs for the analog and digital infrastructure. While some startups such as HelloFresh and Blue Apron compete for the global mass market, other providers target niche segments (see Levy, 2017; Molla, 2017; Watson, 2016).

It is noticeable that different consumer goods producers such as Unilever, Nestlé and Campbell Soup have invested in the Meal-Kit Startups, so there is a forward integration of producers in this area (see Kell, 2016; Ha, 2017; Barclays, undated). In addition, many of the founders have a background in the technology industry and do not come from the retail sector (cf. Sciacca, 2015).

3.2.2 Online retailers

Online supermarkets, platforms and Amazon with its new business models in the food retail sector are listed below under online retailers. The grouping was chosen because all business models relate to the sale of individual, selectable products, regardless of whether they own them themselves or simply provide the technology required for them. Due to the different business model approaches, Amazon cannot be clearly assigned to any sub-grouping and, as a hybrid, is no longer in its own category.

3.2.2.1 Online supermarkets

The online supermarkets Goodeggs and GoPuff considered in the analysis describe online pure players[11] and were funded with approximately $ 47 million and approximately $ 8 million, respectively.

The startups' customer promise is to make the largest possible range of specific products available around the clock and as quickly as possible. The ranges vary depending on the provider and target group. With fresh and long-lasting food, GoodEggs offers the weekly shopping of families or people with little time (see Goodeggs, undated). GoPuff's range addresses impulse purchases. Snacks, drinks and ice cream are the focus of the range. Young, digitally affine people in particular are the target group. (see GoPuff, no year)

The business model is expanded by delivering the goods to the customer's doorstep, thus taking on the step of stationary shopping and offering a convenience factor - the fulfillment of the desire for convenience. While GoPuff makes spontaneous purchases available around the clock and promises to deliver within 60 minutes, GoodEggs offers same-day delivery. (see Goodeggs, no year; GoPuff, no year) The shops do without stationary stores, which means that the customer can order independently of opening times. In addition to ordering via the websites and apps, social media channels are used for customer contact.

The online shops have central partnerships with producers and farmers, from whom they buy their goods. GoPuff has partnerships with major brands, cooperating for example with Hersheys (see Convenience Store, 2018). Goodeggs works primarily with farmers and local food producers to offer fresh, sustainable food. This is an attempt in the supply chain to bypass all middlemen. This saves further costs and makes the food available to the consumer faster and fresher. (see Goodeggs, no yr.)

The orders placed in the online shops are picked, packed and, in the last step, delivered to the customer by our own delivery fleet. In addition to purchasing, partner acquisition and management as well as further development of the digital channels, the work steps mentioned are among the core tasks of the company. The operation of the core resources also corresponds to the company's greatest costs. These include warehouses, the technology (online shop, data analysis, etc.), the delivery fleet and the personnel required for this.

The costs of the business model are offset by income from the sale and delivery of the goods. If desired, payments can be automatically offset via the app. Similar to the meal kits, GoodEggs offers a subscription model.

3.2.2.2 Platforms

Online platforms are increasing in number and awareness. Amazon and Ebay are among the most prominent examples in which supply and demand are brought together in a simplified manner. The principle of the platforms is based on bringing together a large number of providers with their products with different customers on the platforms. (see Diemer, 2015; Gassmann et al., 2017)

The platform startups that are relevant for the food retail sector include GrubMarket, Drizly, Postmates, Instacart with an average endowment of $ 271.75 billion.

These startups are based on the business model of enabling interaction between providers and consumers centrally. The business models therefore always address at least two different actors. According to Gassmann, this is described as a two-sided market (cf. Gassmann et al., 2017, p. 372). On the consumer side, Grubmarket promises to make healthy, local and organic food available for customers who normally cannot afford them or who do not live close enough to a corresponding organic market. On the other hand, the startup addresses local farmers and food producers who may not have the technological and logistical means to market themselves, and offers them the use of the technological means. Grubmarket addresses the producers directly and thus excludes further middlemen. As a result, the startup promises to never store the food temporarily and to offer it much cheaper than other (organic) supermarkets. (see Grubmarket, undated)

Postmates's, Instacart and Drizly's business model is based on the same basic principle, but differs on the provider side. Instead of the producers, local dealers who also do not have the technological and logistical possibilities are addressed. While Drizly offers local alcoholic beverage retailers a platform, Postmates and Instacart are integrating the offer of cooperating supermarkets.

Another central component of the business model is the delivery of the goods. All four providers have their own delivery fleet for this purpose. The fleets are mobile, collect the orders from the providers and are controlled by algorithms as efficiently and cost-effectively as possible. While Drizly, Postmate and Instacart deliver within an hour, Grubmarket first collects, picks and packs the goods before they are then delivered via same-day delivery. Grubmarket is the only one to have its own warehouse for this. (see Grubmarket, undated)

The startups neither buy nor sell the products directly. Because of this, the companies see themselves as pure technology companies. The management, further development and provision of the technology (including e-commerce platform and algorithms for delivery coordination), in addition to operating its own delivery fleet, are among the company's key activities and resources.

In addition, content maintenance and partner and customer acquisition are among the core tasks. The latter is particularly relevant since the business model is based on a self-reinforcing network effect. The more providers and customers are active on the platform, the more attractive it becomes for the other side (cf. Gassmann et al., 2017, p. 372).

Since there are no fixed costs for warehousing and the corresponding personnel, the logistics, management and further development of the e-commerce platform, as well as the specialist personnel required for this, represent the main costs. The income differs in the business models. Postmates, Instacart and Grubmarket take a percentage (approx. 10%) of the sales value in addition to the delivery charges. (see Smith, 2018) In addition, Grubmarket offers a subscription model. Drizly, on the other hand, charges retailers a monthly usage fee in addition to delivery costs (see Crook, 2016).

3.2.2.3 Amazon

Amazon is not a startup in the strict sense and is not listed in the Crunchbase. However, due to its relevance for the food industry, it is included in the analysis. In recent years, the financially strong technology company has penetrated the food retail sector more and more - most recently also massively into the stationary retail trade. The organic supermarket chain Wholefoods was taken over for $ 13.7 billion. (cf. Clausen, 2017) Due to the disruptive influence that Amazon had on other industries in the past, it is essential to consider the new business areas. Since the areas of Amazon Go, Amazon Fresh and Amazon Pantry are new concepts or business models that are partly in the test phase, these are also analyzed among the startups.

Amazon Go

With Amazon Go, the internet company has launched a new stationary retail concept based on digital technologies. With the help of stationary supermarkets equipped with deep learning, sensors and computer vision, the company promises convenient shopping without queuing and paying at the checkout. This technology enables the customer to take the products they need from the shelf and leave the store immediately. The software automatically recognizes what the customer chooses and adds this to the virtual shopping cart. This is automatically billed to the Amazon account after leaving the shop. (see Amazon Inc., no year)

The value proposition for the customer consists primarily in the saving of time and effort. While the products are selected physically, the purchase is processed digitally and automatically. The technology developed for the business model, as well as the specialist personnel required for it, the physical stores and the warehouses, are among the core resources of the business model. The company generates the cash flows in the same way as in traditional food retailing through the sale of the goods. Costs result from the operation of the stationary shops, the technology installation, data analytics and personnel. Personnel costs of up to 30% are saved by eliminating the checkout area. (see Amazon Inc., no year)

Amazon pantry

Amazon Pantry is a concept to solve the big profitability problem of food delivery logistics. The business model is based on the fact that Amazon Pantry lowers logistics costs by bundling products in one box. The customers fill their pantry box via the web shop with products that they use frequently but do not need immediately and receive these - if desired - automatically and regularly delivered. The box is only sent after a certain filling level has been reached. Amazon Pantry generates income through delivery costs and sales of the goods. Fixed costs are reduced by the higher number of items sent per package. Costs for warehouse logistics, personnel and the operation of the online platform are still incurred (see Amazon, no year).

Amazon Fresh

While Amazon Pantry does not offer any fresh groceries, Amazon Fresh is launching a full range on the market. Both own brands and products from other providers are offered via an online shop connected to the Amazon platform. The value proposition lies in the offer of an assortment that corresponds to many times that of a traditional supermarket and delivery on the same day (see Heuzeroth, 2017). While the company has its own delivery fleet in the USA, it cooperates with DHL in Germany (see Scherkamp, ​​2017). Other important partners of the company are local farmers and producers, who are included in the range, thereby addressing increasing customer needs. On the cost side, Amazon does not have to pay any high fixed costs for sales areas or the staff required for it. The costs for the logistics and operation of the e-commerce platform are compared with income from membership fees for Amazon Prime and Amazon Fresh, delivery fees and income from the sale of goods.

3.2.3 Influences from outside the industry

The startup Innit was founded in 2013 in Silicon Valley and is endowed with around $ 43 million. Although this is a platform provider, Innit's main activities do not consist of the food retailing and is considered separately in this chapter due to its advanced level of technical innovation. The value proposition of the tech start-up aims to maximize the time and effort saved in cooking for the customer. It would like to be involved as support in all processes from planning to purchasing, preparation and cooking. The app serves as a channel to the customer, in which all information is bundled. Using sensors and cameras in the refrigerator and in the kitchen, the software can use self-learning recognition to automatically identify foods, offer information about them and suggest recipes. The customer can use the app to create meal plans, order groceries and follow cooking recipes digitally. The software offers the option of using the Internet of Things - the linking of as many smart devices as possible - in the kitchen efficiently, for example to operate it via voice control or to automatically control intelligent ovens. Partners currently include Google with YouTube and its Google Home assistance system, manufacturers of smart kitchen appliances, publishers of recipes and recipe videos and the meal kit provider Chef’d. (see Innit Inc., no date; Magner, 2016; Meek, 2016) While most of the content is created by partners, Innit's core activities are to meaningfully evaluate and link this content. The startup meets this technical challenge with self-learning algorithms, which are also one of the company's most important resources (see Konjtzer, 2017). Even if the business model has not yet been communicated transparently, it can be assumed that most of the income, similar to other platform providers, is generated through agency fees and advertising.

Another non-industry startup is Starship, a British technology startup, founded in 2014 and funded with around $ 17 million. The company produces and sells autonomous driving delivery robots and operates in the B2B segment. (see Starship Technologies, no year) The robots are currently being used on company premises to deliver food to employees during their break (see Burgess, 2018). Furthermore, the company is testing their use in public spaces and is working on problem solutions for possible accidents, Vandalism, theft, range and delivery capacity. Starship is already working on a trial basis with some food and logistics companies such as Postmates, Dominos, and Hermes (see Heise Medien, 2016). The value proposition to the customer company is autonomous delivery by the robots, regardless of high personnel costs and deployment times. Due to the currently high delivery costs, this value proposition is very attractive.

3.2.4 Business model patterns according to Gassmann

According to Gassmann, some recurring business model patterns can be identified in the analysis. With the exception of Amazon Go, all business models use the e-commerce pattern. An already existing service - in this case the food retailer - is offered in a digital version and offers the advantage that the main cost block for the operation of stationary sales infrastructure is eliminated, which means that other value-adding services such as delivery can be cross-financed. The subscription pattern can also be found in the majority of startups. Meal kit providers as well as the Grubmarkt platform or the GoodEggs online supermarket offer such an offer, which is characterized by the contractually defined service relationship on the customer side and steady income on the supplier side. Furthermore, the patterns Leverage Customer Data and Two-sided-Market could be identified as relevant. The former describes the collection of customer data to optimize your own business. Meal kit providers analyze the data, for example, to identify customer preferences in order to create recipes based on this. It also offers all startups the opportunity to analyze shopping behavior and to increase the effectiveness of advertising through relevant content. The two-sided market pattern in particular integrate the platforms, but also, in a broader sense, the online supermarkets into their business model. It is characterized by the simultaneous interaction with supply and demand and the use of network effects. The larger the offer on the analyzed platforms, the more attractive for users - and vice versa.But online supermarkets are also more attractive, the more products from cooperating partners you have in your range and the more customers use the shop, the more attractive they are for producers. (see Gassmann et al., 2017, p. 359 ff.)

3.3 Business model analysis of the industry incumbets

In the following, the incumbents, namely Walmart, Lidl and Rewe, are examined. The companies examined are among the largest in the American and German markets. Due to existing interdependencies, due to their international orientation, they are representative of the industry.

3.3.1 Walmart

The US retail group Walmart Inc. is number one on Forbes' list. At around $ 500 billion, it is the world's top-selling retail company. With retail as its core business, Walmart operates 11,718 stores in 28 countries and promises customers all low prices for all products they need in their everyday lives. The food retailer represents Walmart's largest business area and comprises more than 50% of sales. (see Walmart, 2016; CB Information Services, 2018)

Walmart has started digitizing its business model in recent years. The change in the company's name is symbolic of the change. "Walmart Store Inc." was located in Walmart. Inc modified. (cf. Nanda, 2017) While the traditional business model is based on sales via a nationwide stationary branch network, in the future a shopping experience should be created via interlinked online and offline channels. The three-year growth plan states: “We'll be the first to deliver a seamless shopping experience at scale” (see Walmart, no year). It doesn't matter which channel the purchase is made through - in-store, online or mobile - a simple, fast and best possible shopping experience should be offered.

With "Walmart Groceries", Walmart has started its own online shop. When ordering, the customer can choose between delivery on the same day or pick-up "Click and Collect". With the help of goefencing, the arrival of the customer on the parking lot is detected and the order is then loaded into his trunk. With the cooperation with the smart home provider AngusHome, tests are even carried out one level further. 'Smart' locks and surveillance cameras in the house should enable the order to be delivered safely to the customer's refrigerator. (see Barris, n.d.)

[...]



[1] Although the generic masculine was chosen for reasons of legibility in the text, the information relates to members of all genders

[2] The quote comes from an interview with Lionel Souque, in which the Rewe CEO talks about the role of Amazon in the food retail sector

[3] A detailed description of the methodology can be found in Section 2.2

[4] See Osterwalder / Pigneur, 2011, p. 48.

[5] Own illustration based on Koch, 2006, p. 155.

[6] Own illustration based on Koch, 2006, p. 172; Hornung et al., No date.

[7] A division into categories with the aim of obtaining a "managable number of distinct industries" (cf. Fama / French, 1997, p. 156)

[8] Food Products, Candy & Soda, Beer & Liquor

[9] For the table of the 16 startups described, see Appendix 1; The information on investment amounts described in the following work is taken from this table

[10] For the elaborated BMC templates from which the analyzed information is derived, see the following appendices: Meal Kit Provider: Appendices 2 - 9; Online supermarkets: Appendices 10-11, Platforms: Appendices 12-15, Amazon: Appendices 16-19, External influences: Appendices 20-21

[11] Online pure player: providers who make their offerings exclusively available digitally (cf. Wirtz / Becker, 2002)

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