apply the concepts of E-Business (E-commerce/M-commerce) and Social Media to solve a case study.

1. How business models are different between Tesco Homeplus and Epicureans Experience? Hint: See the business model canvas.

2. If you were Ives, how should you apply an E-business model for Upscale Markets in the Dallas, Texas, market? Hint: you should blend the model canvas of the above two companies.

3. Can you propose any value creation that was not mentioned in the case to implement the E-business for Upscale Markets?

4. How sustainable is any competitive advantage for Upscale Markets? If some giants such as Amazon or Walmart enter the grocery e-market.

Upscale Markets: E-Business Value Creation this move could indeed provide the first mover Tesco Homeplus advantage that Ives was looking for, boosting sales As he walked into the office, Blake Ives was already and market share. Such a bold move had to be thinking about his next move. As the CEO of thought out thoroughly, however. He had to perform Upscale Markets, a seven-store local grocery chain a clear analysis of added value to be sure that the in Dallas, Texas, he had been inspired by the recent initiative would be a success. Luckily, he had a move by the Korean subsidiary of UK-based friend in Houston, Texas - Larry Cantera - that had grocery giant Tesco PLC. Called Home Plus in enjoyed online grocery shopping for a few years Korea, the grocery chain set out to leapfrog the already through a local grocery chain called Rice dominant local player, E-mart, to become the largest Epicurean. Ives immediately called him and, after a grocery provider in Korea. However, with a smaller few minutes catching up, he asked Cantera to number of stores than its rival, Home Plus had to describe his experience. Cantera responded: think creatively. The result was a series of stores located in subways ... with the peculiarity that the Since my daughter Julie was born, our lives have store windows, which looked remarkably similar to become more hectic. With both of us working, grocery the Home Plus store aisles, were in fact virtual (see shopping became even more of a burden. On most weeks Appendix). Each virtual item on display had a QR my wife or I were going to the grocery store twice a week. code (see Appendix) that, when scanned with a I did one big run on Saturday, when everyone else in the smartphone, would add the item to the individual's world was in the store. From the time I stepped out the shopping basket for delivery at his or her home later door until I had the groceries home and in the fridge took about two hours. Later in the week we'd be shopping for that same day. Home Plus claimed that the bread, cold cuts, milk, and whatever we had forgotten. innovation had been very successful and had Last week I spent fifteen minutes completing the on- allowed the company to become the No. 1 online line order. My wife maybe spends another five minutes grocery chain in Korea and to close the gap with E- going over with me anything special she thinks we need. mart for No. 1 overall. Reported results were very After six weeks I have pretty much everything we ever encouraging with over 10 thousand consumers order on our master list at Rice Epicurean. visiting the virtual stores using their mobile phones. As he heard the story, Ives immediately thought, This was promising and inspired Ives to continue The great intuition of Home Plus has been his research. Understanding the value proposition converting idle time (waiting in the subway) to offered by Rice Epicurean held the key to his own productive time (shopping). Most consumers decision making. considered grocery shopping a necessary chore ... they certainly do not enjoy it. I am sure that Home Rice Epicurean Plus has created significant value." Could he pull off a similar feat? Could his grocery chain use Rice Epicurean Markets was the self-reported oldest online shopping as a vehicle to expand without the family-owned chain of supermarkets in Houston, Texas. It traced its roots to Rice Boulevard Market, cost-prohibitive effort of building new stores? As his mind raced, Ives realized that he needed to walk opened in 1937 by William H. Levy, grandfather of the current owners. In 1937, Rice Boulevard was a before he could run. Dallas did not even have a subway system! But it did not have any web-based dirt road in a largely undeveloped future suburb of Houston. Seven decades store, online grocery store either, "and that's where the later, that considerably increased in size, sat in the middle of opportunity is!" Ives mumbled to himself. Upscale Markets could be the first to offer online grocery one of the most desirable living areas in Houston. In shopping and home delivery in its local market, and 1957 a second store was opened. Its first customers on included rice farmers living west of Houston; by the marketing and customer services, explained. People time the new millennium rolled around, those rice don't know this, but we've been delivering fields had become Houston's prestigious Galleria groceries for a very long time ... We have area. Rice Epicurean's other four stores were customers who've been faxing in their orders for located in similarly well-to-do neighborhoods, years. We have our own delivery vans, and we including one almost across the street from a deliver out of each store. Customers could also join recently opened giant HEB Central Market. The six the chain's loyalty card program. The Experience stores ranged in size from 20,000 to 42,000 square Card provided lower prices on promotional items, feet. Founder William Levy sought to provide discounts products and services from quality products and personal service to his Epicurean's Experience partners around Houston, customers. With its founding in 1988, the Rice and in some instances, rebate coupons for a certain Epicurean chain continued that tradition. level of purchases. For Rice to now compete with the larger chains, we re-created ourselves in a successful effort to be the best grocery store in town . . . each store operated Discussion Questions by Rice Epicurean Markets is still merchandised to 1. How business models are different between be in tune with its particular neighborhood. The Tesco Homeplus and Epicurean's Experience? charge card system with monthly billing, introduced Hint: See the business model canvas. in 1964, remains in effect. Rice Epicurean Markets 2. If you were Ives, how should you apply an E- prides itself on the growing number of employees business model for Upscale Markets in the who have been with the chain for 20 years or more Dallas, Texas, market? Hint: you should blend and can tell you by name, the customers and their the model canvas of the above two companies. families who have shopped with them for many, 3. Can you propose any value creation that was not many, years. The stores, while smaller than other mentioned in the case to implement the E- Houston chains, sought to maintain a rich inventory business for Upscale Markets? of typical grocery store items as well as gourmet 4. How sustainable is any competitive advantage for products, chef-prepared foods, high-quality bakery Upscale Markets? If some giants such as Amazon products, and, in most stores, full-service meat or Walmart enter the grocery e-market. departments. Home delivery was not new to Rice Epicurean, as Phil Cohen, director of loyalty Appendix: Business Model Canvas Customer Segn for whom the company is creating value? Value Proposition: the specific set, or bundle, of products & services that create value for customers Distribution Channels: physical or digital mediums, or touch points utilized to deliver value to its customers Customer Relationships: are tangible and intangible connections the company establishes with the customer Revenue Streams: how the company "monetizes its value proposition Key Resources: the competency and resources the company needs to build its competitive advantage Key Partnerships: upstream/downstream relationships the company must be able to leverage Cost Structure: focuses on outflows of cash to upstream/downstream partners & providers of resources