The grocery store and supermarket shopping industries have combined annual revenues in the hundreds of billions of dollars. With little variation in available item selection and price as well as less money being spent on groceries in the downtrodden economy, competition for customer loyalty is stiff. By using information technologies (ITs) to help process buying habits of its customers, Stop & Shop, a Quincy, Massachusettsbased grocer, tried to get a better grasp on the hardtounderstand concept of customer loyalty in grocery shopping. Stop & Shop introduced Scan It!, a portable electronic device for customers shopping in its stores. The device allowed customers to "scan and bag" products, expediting checkout times at the end of their shopping trip. Additionally, the device offered deals based on the location of the scanner (and therefore the customer) in the store. Locationspecific discounts in real time became increasingly popular among customers as use of Scan It! grew by 10% in both the first and second quarters after its introduction. The most beneficial aspect of the Scan It!, however, came with the powerful software built into the device by Modiv Media in which Stop & Shop owns a minority interest. The software kept track of each customer's past and present purchasing habits in order to individualize coupons in real time for the customer.

The scanner resulted in three positive trends for Stop & Shop. Customer loyalty grew, allowing the company to secure an increased customer base than area demographics would predict. Additionally, each shopper's basket size increased as the individually tailored coupons enticed customers to buy more. Lastly, Stop & Shop's customer base grew as word of mouth marketing brought in more customers to try the stateoftheart device. However, after a couple of years, Stop & Shop saw customer adoption plateau. In October 2011, the grocer created the Scan It! App via the help of freelancers. The Scan It! App could be used for iPhone and Android. By eliminating the need to sign in and retrieve a scanner at the store, customer adoption of the device continued its upward climb. In addition, as customers became increasingly concerned about saving money while shopping, Stop & Shop built in budgeting software that allowed customers to track their spending more effectively. Ads for the new app proclaimed: "New Mobile App Allows Customers to Shop, Bag, and Tally Their Grocery Order with Their Personal iPhone and Android Devices." Scan It! was heralded as "a first of its kind grocery app that allows customers to use their personal mobile device to scan, tally, and bag their groceries while they shop."

Stop & Shop had bundled an app that not only rewarded customers who shopped at its stores by helping them save money but also tracked information on sales, which the company loaded into its data warehouse. The IT team of Stop & Shop perform analyses based on the data in the data warehouse and provide business insights regarding its customers to Stop & Shop management. The results from the analyses helped Stop & Shop put the right items on its shelves to maximize sales and create customer loyalty.

Question 1 (a) Evaluate the application of business, organisational and information system strategies by using Michael Porter's Five Competitive Forces framework to analyse the competition of the Stop & Shop market for the following: Extent of rivalry among competitors Threat of substitute products/services Indicate in your answer if the competitive force is low, medium or high. Support your answers with case facts.

(b) Propose how information resources can be employed by Stop & Shop as strategic tools by describing an example of the following: Information repository Technical skills IT management skills Relationship skills (externally focused) Note that the information resources framework can be categorised as IT capabilities and IT assets.

(c) The management of Stop & Shop is considering the use of robots as part of its work revamp. The management is also considering whether to allow telecommuting for some employees. Discuss how IT changes the nature of work in the context of Stop & Shop by providing: (i) One challenge faced by the management if telecommuting is permitted, and one way to mitigate or overcome the challenge you have listed. (ii) One example of how robots can be useful for the company.