Why might disruptive technologies present a potent threat to industry incumbents? (4 pts) A. Incumbents may dismiss them because they offer inferior performance. B. The incumbent’s customers value what they offer. C. They offer lower margins. D. The threat they pose may be difficult to detect.
Read DetailsSuppose you work for an online travel agency such as Expedia or Booking.com and are tasked with the role of growing the platform in a profitable manner. a). What types of network effects and multi-homing tendency characterize this platform market? Describe the strength of these effects. (6 points) b). What types of digital strategies would you deploy to compete effectively in this platform market? Justify your reasoning. (6 points)
Read DetailsAmazon expands Same-day Delivery with Fees, while battling slow growth (WSJ Feb. 2023) Amazon.com Inc. is expanding ultrafast delivery options, a sign that it remains committed to pushing its logistics system for speed as it scales back plans in other areas. The tech giant is continuing to devote resources to facilities and services structured to deliver packages to customers in less than a day. The expansions are happening at a crucial point for Amazon, which faces competition for fast-delivery options while Chief Executive Officer Andy Jassy puts a renewed focus on profits. A central part of Amazon’s ultrafast delivery strategy is its network of warehouses that the company calls same-day sites. The facilities are a fraction of the size of Amazon’s large fulfillment warehouses and are designed to prepare products for immediate delivery. In contrast, the larger Amazon warehouses typically rely on delivery stations closer to customers for the final stage of shipping. Amazon has opened about 45 of the smaller sites since 2019 and could expand to at least 150 centers in the next several years, according to MWPVL International Inc., which tracks Amazon warehouse operations. The sites have primarily opened near large cities and deliver the most popular 100,000 items in Amazon’s catalog, MWPVL said. New locations recently opened in LA, San Francisco and Phoenix, according to Amazon, which declined to provide information on how many of the same-day sites it has. “We’re always exploring ways to bring our customers new levels of convenience and delivery options that work best for them. Same-Day Delivery is one of the latest innovations,” an Amazon spokeswoman said, adding that more than 1.5 million customers a month are trying same-day delivery for the first time. The costly nature of fast shipping is a challenge. Amazon uses contractors to make deliveries from the same-day sites. “Last mile” costs to deliver items from the locations can be around $3.30 a package, compared with $1.75 for packages at its traditional fulfillment sites, according to MWPVL. Using same-day sites can eliminate other costs that apply to the company’s standard fulfillment system, MWPVL said. Amazon executives recently reiterated their commitment to quick shipping. Chief Financial Officer Brian Olsavsky this month said that the company aims to expand its fast-shipping services and that Amazon Prime subscribers respond well to them. a). How can Amazon use same-day shipping to compete effectively against other brick-and-mortal retailers (e.g., Wal-Mart, Target) as well as other online retailers? Describe two strategies that Amazon can deploy to grow its traditional e-commerce business (10 pts) b). How can Amazon monetize its same-day, ultrafast delivery business model? Identify and briefly describe two platform strategies that they can deploy to compete effectively. (10 pts)
Read Details