Webvan is an online company that provides grocery purchase and delivery. It began business in 1997 using funds from venture capital investors. It primarily serves customers in the San Francisco Bay Area. It?s very first day on the Nasdaq it reached $34 a share, this price per share was the highest that it ever traded. Now it has not traded above $1 for quite some time. In fact, it?s on the verge of being taken off the Nasdaq.
This company offers a wide range of grocery items, which would cover the average households needs. However, their sales have declined so much that it is predicted that they will be out of money in two more quarters, unless they change their strategy.
Why is Webvan?s lack of sales happening? Some symptoms I have identified are: ÃÂ§ People don?t know about Webvan ÃÂ§ The people that do know about Webvan and use it, only do so sporadically ÃÂ§ The website could be too confusing for some people ÃÂ§ The pricing of the products are inflated for this market ÃÂ§ The delivery system in place takes too long, and does not meet the customer?s wants and needs ÃÂ§ People may not feel that the website is secure for them to give their credit card number over the internet ÃÂ§ The service they are selling is shopping convenience and the customer?s lack of purchasing tells us that they don?t find it that convenient to use all the time ÃÂ§ Most importantly, persuading people to change their mind set for grocery shopping to an online service is the greatest challenge.
To be successful, people must be confident that they will have the needed items at the right time, and at the right price The above items are both internal and externally driven. For...