uber case

Question 1

what is coronership

Answer 1

App to order from supermarkets
Market leader (70-80% sales volume in chile)
Most present in south america
Cornershop: target demographic is targeted toward young professionals and university students
How does
Actual custustomers who dont want to go inside the stores they order online isntead
Revenue: supermarkets, participate so do the personal shoppers
Can reach more customers though developing onlien channel
what motivates supermarkets —> increase customer base
a lot of growth
people who don’t have time for a full trip to the grocery store
personal shoppers were trained, had profiles , wanted to work there bc of flexible schedules and weekly oayemts
had non exclusive agreements with som e retailers
launched in Chile

Question 2

who is cornershops competition

Answer 2

Competition: doordash, instacart, delivery apps, supermarket chains, supermarkets were creating their own apps
Active competition
market is competitive

Question 3

What was the strategic reason walmart wanted to by cornershop→

Answer 3

because of amazon, they knew they were not focused on ecommerce and this was their disadvantage, walmart had a large market share , specific to the region of south america e commerce f
Walmart was lacking this online development
Diversification that was represented from the acquisition of corner shop by walmart: vertical integration (buying a new additional distribution channel), forward vertical integration ( cornershop is a distribution channel they would be purchasing, clsoer to the end consumer)

Question 4

why did anti trust authorities say no to this acquisition

Answer 4

they feared walmart would become a monopoly and have too much power over the grocery market and potentially the delivery market
Walamrt would cause elimination of competitors if they acquired cornershop
How does this affect supermarket → if wlmart owns conershop which is a dominant app, it will own the data, transactions from other supermarkets → can understand what consumers like, sales patterns
Can see what competitors products were the most popular, canc control the visibility of products on the app (put competitors products at disadvantage and copy competitors products based on data they can collect)
hinders fair Competition

Question 5

what is Walmarts strategic goal

Answer 5

want to increase their presence in south america and e commerce,

Question 6

advantages of an acquisition

Answer 6

by going with this route they can have a system that already works without having to do anything, they have the money to buy it, cornershop already has a large market share, buying the existing tech that is proven to work, predictability ,may spend a lot of money for it not to work, have to compete against cornershop, acquire customers, do marketing, lot of uncertainty, will take time , speed to market is slower

Question 7

what is uber really good at

Answer 7

hey are accessible and easy to use, the biggest asset for uber is data they own, technology of the app, can predict demand, Technology of the app is very valuable, more efficient compared to classic taxis

Question 8

why does uber need a supply of drivers

Answer 8

customers can become unhappy if not enough drivers

Question 9

synergies between uber and uber eats

Answer 9

Uber eats and uber drivers can do the same job → dont need to hire as much, keep drivers occupied, creates loyal workforce of drivers , wont serve competitors
For non peak times people still want to eat so they can mix up the drivers

Question 10

how does uber eats generate revenue

Answer 10

Uber eats took a cut of 15-40 percent on every order

Question 11

why does uber want to acquire conershop

Answer 11

Expansion throughout latin america and south america, specifically through cornershop because they can create synergy through data sharing and insights sharing
Part of ubers strategy is to be able to delivery everything to everyone, they want to add another division(grocery division) all through the same tech and app

Question 12

What type of diversification when adding grocery division:

Answer 12

horizontal

Question 13

why did anti trust authorities allow uber to acquire coronership

Answer 13

looked if competitors would be eliminated, would uber have an unfair advantage. At that time many supermarkets developed their own apps, corner shops comp increased, we dont think with horizontal diversification much will change
Didnt feel that uber was a threat

Question 14

synergies uber can realize through acquisition

Answer 14

expanding customer base, bringing knowledge from cornershop about grocery so dont have to pay costs

Question 15

synergies coronership can realize

Answer 15

provides drivers with another service ( personal shoppers) making drivers more busy so they dont go to competitors.

Question 16

synergies

Answer 16

Enrich ubers data coming from grocery division, info on local customers
Once stop shopping for user
Uber is already investing continuously to improve
Reduce costs by creating economies of scale, economies of scope because they are sharing their resources
Cornershop and uber understand each other
Both tech companies so can integrate their technologies
Cross promotion among different divisions → cornershop is stronger in south america, internationally uber is stronger
20-30% also like to order from restaurants of cornershops customers, so ubereats can gain more revenue from this too

Question 17

Are customers more loyal to cornershop or uber

Answer 17

Customers said that uber is fully replaceable but cornershop is more differentiated and not replaceable
Uber can capatalize on this→ cross promotions, offer bundles

Question 18

what does cornershop bring to uber

Answer 18

Brings customers
Fast delivery
Personalized shopping
Brings technology and network of supermarkets
Uber Inherits the suppliers
Integrate tech
By acquiring cornershop uber can strengthen its competition against multi point competition like other brands that offer a variety of things

Question 19

in cornershop view, would you want uber or Walmart

Answer 19

Geographical expansion: uber is better bc its international
Strengthening presence in south america: walmart is better
Technology and logistics: uber is better, they have an app. Wlamart wanted to acquire cornershop for its tech
Stability of revenue, loyal customers: Uber is a startup walmart is more established, int terms of customers and grocery sales that happened online is 4%, people still buy traditionally in the stores, e commerce for buying groceries is growing but small % buying groceries online
The future of cornershop brand→ uber would allow for cornershop to keep their brand name, uber doesnt have a strong brand name in south america whereas walamrt does so they dont need to capitalize on it as much as uebr does

Question 20

what type of integration strategy

Answer 20

At the start was preservation (promised autonomy) → no one would be replaced and cornershop brand name is kept

Question 21

avantage of using preservation

Answer 21

Cornershop has a strong brand name and is loved and irreplaceable unlike uber, so why not preserve that instead of change it to uber’s less popular brand name

Question 22

disadvantage of using preservation

Answer 22

might be hard to form synergies

Question 23

postulates

Answer 23

Another acquisition was postmates and also used preservation strategy

Question 24

über and coronership are what type of platforms

Answer 24

multisided

Question 25

business model of cornershop

Answer 25

consumers can purchase from grocery stores apps listed had an agreement w cornershop charged a delivery fee personal shopper does your order--> they have their own trasnprotion customers pay cornershop and cornershop pays the grocery store

Question 26

founders and early history of cornershop

Answer 26

first they tested the idea and was launched in Chile wanted to seek scalability at the tine, had the highest market share in the supermarket industry

Question 27

failed cornershop and Walmart merger

Answer 27

Walmart wanted to boost its e commerce ambitions in Latin America would create significant barriers to entry for other supermarkets would create a vertical integration --> exclude cornershops competition and Walmarts comepttotors

Question 28

uber

Answer 28

has good tech, brand recognition, massive network, operational and scale efficiency but was insuring losses über eats and über could share drivers, have to keep the drivers loyal über was in Chile

Question 29

the transaction

Answer 29

was allowed bc other supernkarts were investing in their development of e commerce über was expanding to clothing, toy uber wants to expand throughout t Latin America good for cornershop bc they can offer grocery services in many markets they were kept as distinct rands and cornershop would continue under its previous leadership, had autonomy

Question 30

competition in the market of delivery applications

Answer 30

über eats comètes with door dash, grub hub, postulates at the end of 2020, door dash was leading and was try to expand uber bought postmates --> postmates would still operate under its own name in Chile, category of delivery apps was growing cornershop led online supermarket sales in Chile people have more than one delivery platform though and people think uber eats is replacable dont want to pay for subscription

Question 31

conclusion

Answer 31

multisided platforms allow access to third party goods were becoming super attractive, growing bc of e commerce and consumer habits stikl have challeges w structure, value creation, networks should they operate indepdenlty cornershop was going to be a separate company but until what point?

Question 32

why does uber want to expand to South America

Answer 32

stiff competition in the market

Question 33

acquisition between Walmart and cornersjop

Answer 33

would imply a vertical integration Cornershop is a last-mile delivery service that bridges the gap between grocery retailers and consumers. By acquiring Cornershop, Walmart would have gained direct control over the logistics and delivery aspect of its grocery business, reducing reliance on third-party delivery services. This would have allowed Walmart to streamline operations, improve delivery efficiency, and potentially reduce costs related to contracting external delivery services would provide significant barriers to entry

Question 34

in Chile, was delivery application growing

Answer 34

yes by a lot, people wanted to jlom