Webvan Marketing Plan

881 Words4 Pages
Webvan’s Marketing Plan Executive Summary Webvan, incorporated in 1996 had a vision to provide grocery-shopping solutions directly and rapidly to consumers that would save them both time and effort, without sacrificing the quality, selection, and low prices of traditional brick-and-mortar stores. Operations from December 1996 through June 1999 were focused on the activities of raising capital, developing and implementing their business strategy, constructing and equipping their first distribution center in Oakland, CA and developing relationships with vendors. Webvan’s business strategy positions the company within the grocery-shopping/retailing industry. The home-shopping industry for groceries has been around since 1990. The online grocery business is in the beginning phases of its growth stage. The number of individuals that are acquiring access to the Internet is increasing and the consumers that are already familiar with the Internet are becoming more comfortable with transacting orders via computers. Webvan’s direct competitors when it debuted in 1999 were Peapod, Streamline, NetGrocer, HomeRuns, HomeGrocer, and Albertson’s. Competitors had market presence before Webvan and the business model was not novel. Webvan had to differentiate. To differentiate, Webvan built highly automated distribution center designed to provide high degrees of scalability and efficiency, enabling them to operate with much lower overhead and reduced headcount compared to traditional supermarkets. Webvan took a bold step when it announced $1 billion deal with Bechtel to build giant distribution centers in 26 cities in U.S. by 2001. Webvan believed that the significant capital investment in their business provides them with a competitive advantage compared to traditional supermarkets and other online grocers. Webvan’s hub model has only been proven at low capacities,
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