Wholefoods - Business Model Project


Published on

Digitizing your business / Class assignment.
Our team developed a new digital business model for Whole Foods market, to support revenue streams and future-proof the business.

This PPT describes briefly the current business model, set out a framework of the category and consumer motivation and presents a new model recommending the benefits of The Personal Shopper - virtual figure.

[jun 2011]
Digitizing your business model - Professor: Neil Perkin
Master of Digital Marketing - HULT London

Illustration: Carlos Rivas
[Originally the characters were created as a representation of colleagues in Advertising]

Published in: Education, Business, Technology

Wholefoods - Business Model Project

  1. 1. BUSINESS MODEL PROJECT20th April 2011 A - Team - Hult
  2. 2. 2 4 1 6 5 31. Manuel del Aguila - SEO 4.. Martha Tolosa - Email Marketing2. Daniel Aufricht - Strategy and Planning Integration 5. Megan Lowe - Social Media3. Nataliya Mogilevskaya - Mobile 6. Pratanchai Permpanich - Display
  3. 3. Brief Overview20th April 2011 A - Team - Hult
  4. 4. 20th April 2011 A - Team - Hult
  5. 5. Whole Foods “We seek out the finest natural and organic foods available, maintain the strictest quality standards in the industry, and have an unshakeable commitment to sustainable agriculture.” Founded in 1980 in Austin, Texas. Growth throughout the 1990’s. Acquired more natural and organic food companies.20th April 2011 A - Team - Hult
  6. 6. Values: • High quality natural and organic products • Delighting customers • Supporting employee happiness and excellence • Creating wealth through profits and growth • Taking care of community and environment • Create mutually beneficial partnerships with suppliers • Promoting health of stakeholders through healthy eating educationConsistently ranked among the most socially responsiblebusinesses.20th April 2011 A - Team - Hult
  7. 7. Current Business Model20th April 2011 A - Team - Hult
  8. 8. Offline Online SHOPS WEB SITE Full-version Mobile20th April 2011 A - Team - Hult
  9. 9. 20th April 2011 A - Team - Hult
  10. 10. Content Gift Cards Cooking Classes Coupons Stores Deals Location Recipes Comments Information products Registration List of products20th April 2011 A - Team - Hult
  11. 11. Shopping list Products Recipes20th April 2011 A - Team - Hult
  12. 12. Framework20th April 2011 A - Team - Hult
  13. 13. What products or services do you usually purchase online? Econsultancy Survey (2010)74% of the respondents usually buy these products online: 20th April 2011 A - Team - Hult
  14. 14. • These statistics show an increase in this trend, which supports the potential of the business model • People trust this kind of service and embrace the online shopping system • People would sometimes rather pay more for a service in order to save time20th April 2011 A - Team - Hult
  15. 15. Why do people shop online?Nielsen Online survey of 1000 people shows that peopleshop online because of the following reasons:20th April 2011 A - Team - Hult
  16. 16. • Tight schedule • Stressed out The Big City • Time is essential • Traveling is expensive20th April 2011 A - Team - Hult
  17. 17. London Market Organic & Online Online Likelihood Market Natural? grocery personal of online Share (incl. shopping? shopping? shopping? offline) Not yet, but Not yet, but Likely to take 1-2% soon with our soon with our share from model model below stores Branded range " 4% 4.4% as well as other organic / natural brands Small branded " 14% 16.5% range Small branded To an extent, 66% 30.3% range, adding not with advice non-food range and guidance soon20th April 2011 A - Team - Hult
  18. 18. Organic food is no longer just a niche“The niche is gone. Organic has gone mainstream.”New opportunity in “special diets”, including thoserelated to food allergies.“Food allergies in children have risen 18% since 1997,affecting 3 million children today. Nearly 4% of adults, or12 million people, have food allergies. Another 3 millionpeople cant consume gluten (ceilac disease). In this nicheyou could include aging baby-boomers who focus onlow-sodium, low-fat, dairy-free diets or people whoadopt alternative diets like veganism.”Sources: http://mattpaxson.blogspot.com/2008/11/heath-foods.html20th April 2011 A - Team - Hult
  19. 19. What customers want - Speed - Convenience - Healthy Alternative - Quality over quantity - Something trustworthy - Value for price20th April 2011 A - Team - Hult
  20. 20. Consumers’ behaviour Fraser McKevitt, retail analyst: “With economic uncertainty increasingly in the news it is no surprise that shoppers are being cautious with their spending” Sources: http://foodanddrinkbusiness.com/?p=380320th April 2011 A - Team - Hult
  21. 21. The Digital Model Needs Desires Quick Quality > Quantity Convenience Trustworthy Healthy Best value Affordable Customer20th April 2011 A - Team - Hult
  22. 22. Potential Digital Models20th April 2011 A - Team - Hult
  23. 23. Twelpforce: Customer Service on Twitter20th April 2011 A - Team - Hult
  24. 24. Trip Advisor: Rating of Hotels20th April 2011 A - Team - Hult
  25. 25. New Digital Business Model20th April 2011 A - Team - Hult
  26. 26. Shopping online is not a novelty. There is a need in the market that has not been met. When people buy goods online, there are often doubts about the quality of products like fresh goods.20th April 2011 A - Team - Hult
  27. 27. Insight: “It is difficult to buy fruits or vegetables online, I do not know if the goods to be delivered are going to be exactly as I expect them”.20th April 2011 A - Team - Hult
  28. 28. Wholefoods is going to enter the market online with an innovative advantage20th April 2011 A - Team - Hult
  29. 29. The Personal Shopper It is a virtual figure that is going to help customers to pick special goods that need to be chosen by an expert. There are several options of experts. Customers are able to see their profiles and choose one of them, based on their needs.20th April 2011 A - Team - Hult
  30. 30. Lucy. Expert in fruits. If you fancy the most exotic fruit salads in the world, you need Lucy. If you don’t know how to pick a pineapple, or a juicy melon, don’t worry, that is her job.20th April 2011 A - Team - Hult
  31. 31. 20th April 2011 A - Team - Hult
  32. 32. Laura. Expert in vegetables. She picks fresh products for you. Tell her if you need your avocado ripe, to be eaten on 3 days or however you need it. Hear suggestions for this season and try new salads.20th April 2011 A - Team - Hult
  33. 33. 20th April 2011 A - Team - Hult
  34. 34. Sam. Expert on BBQ’s. Sam used to have BBQ all the time back at home in Australia. Tell him what kind of party you are imagining and for how many people and he will sort it out.20th April 2011 A - Team - Hult
  35. 35. 20th April 2011 A - Team - Hult
  36. 36. David. Expert on packed lunches. Did you run out of the choices to surprise your kids at school? Talk to David and let your children the chance to try new healthy flavours and fun choices from an expert.20th April 2011 A - Team - Hult
  37. 37. 20th April 2011 A - Team - Hult
  38. 38. Implementation 1. Collect offline data (loyalty cards) 1. Collect offline data (loyalty cards) 2. Create programm for 2. Create programm for recommendations recommendations 3. Build infrastructure andand hire 3. Build infrastructure hire employees 4. Testing employees 5. Advertising 4. Testing 6. Bring customers online and launch the 5. Advertising service customers online and 6. Bring launch the service20th April 2011 A - Team - Hult
  39. 39. -Customers can see shopper’s profiles -Pick their favouritewww. -Rate them -Recipes for every season -Low calories, get fit -Special occasions -Send messages, preferences -Shopping lists can be rated and edited, can be improved -diet- -Track purchases of the customers -Suggestions, posible combinations, Cross selling. ”Like” the page Interaction on FacebookLoyalty card to trackoffline performance -Personalised info Follow your personal shopper according to preferences for recipes - Friend to friend sharing -Offers to promote loyalty 20th April 2011 A - Team - Hult
  40. 40. Model’s Dynamic Deliver Goods and Other awaiting feedback: customers’ if negative, an incentive suggestions will be offered. Selection of products for the customer Product Customer Feedback Information gathered, based onthe customer’s previous shopping activities, behavior, and Gather information feedback. Database Optimize recommendations,20th April 2011 A - Team - Hult channels, according to database
  41. 41. After the first phase, more products can be offered:Candies, Liquors, Deli, Dry Goods…20th April 2011 A - Team - Hult
  42. 42. Goals • Establish a closer relationship with the customer • To become a full service online supermarket • Turning online shopping into a personal experience: customers and experts can be friends • Added value by experts: recipes, recommendations, health advice, cross selling • Earning customers through personalized channels20th April 2011 A - Team - Hult
  43. 43. ULTIMATELY Competitive advantage20th April 2011 A - Team - Hult
  44. 44. Recommendations20th April 2011 A - Team - Hult
  45. 45. • Establish basic online shopping capabilities to start with• Implement personal shopping as a value-added option• Introduce a loyalty program to track customers’ purchases, lists, behavior, feedback• Testing before launching online• Adapting characters after feedback and depending on seasons• Hiring analytics experts to interpret the data• Monitoring the social networks• Starting in London with a possible roll-out to NY and LA20th April 2011 A - Team - Hult
  46. 46. Thanks! Any questions?20th April 2011 A - Team - Hult