Deliveroo Case Study: Innovation, Strategy, and Business Models

This case study examines Deliveroo's business strategies, focusing on the key drivers of its innovation and success in the online food ordering and delivery industry. It analyzes the company's entrepreneurial vision, business model, and competitive strategies at both the business unit and corporate l...Read More

Deliveroo Case
Study

INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Using models, identify and evaluate the key drivers of innovation contributing to the success
of Deliveroo (700 wrds)...............................................................................................................1
Different approaches undertaken by Deliveroo to help shape its entrepreneurial vision and
business model. Competitive strategies at both the business unit level and corporate level.......1
Appropriate Blue Ocean tools and frameworks...........................................................................4
Set of conclusions that succinctly highlights the key aspects covered in the literature...............6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategy is combination of all decision taken as well as action performed by an
organisation for accomplishing their business goals as well as objectives in effective manner (Jin
and et. al., 2018). It is backbone of company because business strategy is roadmap that leads to
the desired goals. This report is based on case study of Deliveroo which is part of online food
ordering and delivering industry. It was established in the year 2013 by Will Shu and
headquarters is at London, England, United Kingdom. Respective organisation has craeted a
personal goal for taking high-grade local restaurant assist to people doors and to convert the
eating habits of customers. Along with this, Deliveroo the prior aim is to supply best quality of
food products as soon as possible.
This report will going to discuss model as well as key drivers of innovation which are
contributing within success of Deliveroo. In addition to this, different approaches will elaborate
that assist is shaping entrepreneurial vision and business model. Moreover, competitive strategy
at both business units as well as corporate level will going to elaborate. Apart from this,
appropriate blue ocean tool will implement in relation to Deliveroo.
MAIN BODY
Using models, identify and evaluate the key drivers of innovation contributing to the success of
Deliveroo
Deliveroo's mission is to create a high level of general restaurant which is directed to
people's doors as well as to convert the eating habits of consumers. Continuous innovation and
creativity of respective company is offering best choice and convenience. In addition to this,
Deliveroo's aim is to provide high quality of food products to service users within minimum time
duration which is less than 30 minutes. Respective organisation, 'Frank' algorithm is based on
powerful predictive technology which help in evaluating effectual way of distribution order that
are based on location of restaurant, riders as well as customers. As Deliveroo had already reduce
their time by 20% which simply means that riders now able to deliver more per hours and can
increase their earning (Sagath and et. al., 2018). In relation to this there are several factors which
work as an innovative drivers for Deliveroo explanation of these are as follows :-
 Economic key driver – It is one of the major key drivers which play important role in
innovation that an organisation is bringing. Such as economic condition of any country is
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good become easy for Deliveroo Company to bring their innovative idea full stop
because economic condition also results in population wealth which simply shows that
people living in that particular Nation have good source of income. This has direct impact
on working of respective company if people have good source of income they will be
able to please order. In simple term it can be said that economical factors give positive as
well as negative both impact on working of an business firm while coming up with
something innovative in market area.
 Technology key driver – Technology is that factor which is getting update day by day as
well as have wide impact on working of organisations. In relation of Deliveroo Company
Technology worked as key driver of innovation as the implement search technology
which help them in reducing their order item delivered by 20%. That simply mean that
delivery man deliver parcel in less than 30 minutes so by this in one hour more delivery
can be attempt that reserve to increasing revenue of company as well as also of delivery
man. In simple term it can be said that Technology advancement have positive and
negative both impact because sometimes it is not easy for and business form to
implement advanced technology within their working as it is expensive.
 Social key driver - This factor include taste and preferences of customers which is
essential for an organisation to consider within their working. As it help them in making
customers satisfy and fulfilling their needs and wants in effective manner. In relation to
Deliveroo, Social factor work as an key driver of innovation for respective organisation
as people are suffering issue with late delivery of their order item which has been
identified by business firm. Thus, by taking advantage of this issue company come up
with an innovative idea of delivering food with less than 30 minutes help them in in
getting better advantage within business environment and grabbing attention of more and
more customers.
Thus, all these above mention key drivers of innovation help Deliveroo in bringing their
innovative idea within market in easy manner as well as also play important role in grabbing
attention of customers.
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Different approaches undertaken by Deliveroo to help shape its entrepreneurial vision and
business model. Competitive strategies at both the business unit level and corporate level.
Deliveroo's mission is to bring best local restaurant which is directed to people's doors as
well as to transform the way customers eat. By constantly innovating and expanding respective
company is offering best choice and convenience. In addition to this, Deliveroo's aim is to bring
great food direct to customers within minimum time duration which is less than 30 minutes.
Respective organisation, 'Frank' algorithm is based on powerful predictive technology which
help in evaluating effectual way of distribution order that are based on location of restaurant,
riders as well as customers (Herstad, 2018). As Deliveroo had already reduce their time by 20%
which simply means that riders now able to deliver more per hours and can increase their
earning. In relation to this several strategies has been implement by respective company which
help in shaping its entrepreneurial vision and business model. Explanation of these strategies are
as follows :-
Porter's generic strategy – This strategy help in determining direction of an business
firm. Porter's generic strategy has been introduced by Michael Porters which include 4 strategies
which an organisation can use for attracting customers and gaining competitive advantages.
According to respective author company should have to choose clear course for beating
competition. Basis of this model has been developed by three basic methods i.e., cost leadership,
differentiation and focus. Later on he divided into differentiation focus and cost focus .
Explanation of these four stages in relation of Dileveroo's are as follows :-
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(Source: Porter's generic strategy, 2019)
 Cost leadership – The main objective of the organisation according to this strategy is
become lowest cost producer within organisation. Moreover, traditional method to
accomplish cost leadership objective is to produce on large scale that enables an
organisation to exploit economies of scale. Strategy of cost leadership need close
cooperation within all the functional areas of business. For becoming low cost producer
there is requirement to implement these strategies such as high levels of productivity,
high capacity utilisation, lean production methods, effective utilisation of technology
within production procedure and many more. Cost leadership strategy is not suitable for
Deliveroo's are they are coming up with innovative idea in which company deliver food
in less time.
 Differentiation - This strategy make organisation their offerings different as well as
more attractive in comparison of others for accomplishing competitive advantages (Kahn,
2018). Through differentiation strategy business firm target large market and focus on
differentiation at wider scale. Deliveroo is focusing on differentiation strategy as they are
reduce their delivery time by 20% and consume less than 30 minutes. There is high level
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Illustration 1: Porter's generic strategy, 2019

of competition within food ordering and delivery so it is important for respective
company to use some different strategy. Because this will help them in attracting large
number of customers and also in serving them within effective manner. As they are
focusing on large market area within numerous customers because they are providing
services to different locations such as United Kingdom, Netherlands, France, Belgium,
Hong Kong, Ireland, Spain, Italy, Australia, Singapore, Kuwait and United Arab
Emirates.
 Cost focus – In this strategy company focus on targeting niche market and offer the
lowest possible price. Within, Cost focus strategy products are generally basic, vaguely
similar to the average market leading products as well as it will be acceptable to
sufficient number of customers for generating revenue. Respective strategy is not
Suitable for Deliveroo as they are not focusing on cost as well as small market segment.
 Differentiation Focus – In this strategy business firm look for developing product
differentiation but in smaller number of market segment (Caloffi and Mariani, 2018). As
by this organisation focus on small number of group and specifically appeal requirement
of this group. In this process organisation requires to identify requirement of their
customers in order to providing them quality of services easily. Through this they can
build direct connection with them. Differentiation focus approach basically deals in the
niche market where seller of particular products is limited and have partial potential to
sell their services effectively to its services users. These kind of approaches invite
innovation and creativity for an organisation in order to render different services to users.
Deliveroo is implementing differentiation strategy as they are coming up with something
different i.e., deduction in delivering time by 20% which means in less than 30 minutes. Along
with this, they are covering large market segment so for them respective strategy will be more
suitable.
Ansoff matrix – This matrix is also known as Product/Market expansion Grid which is tool
utilise by an organisation to analyse as well as plan their growth strategies in effective manner
(Chen And et. al., 2018). Ansoff matrix shows four strategies which assist firm growth and also
help in analysing risk related with every strategy. Explanation of these four stages in relation of
Deliveroo are as follows :-
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 Market penetration – This strategy is less expensive as it leverages several existing
resources as well as capabilities of company. Within growing market, maintaining market
share will result in growth as there are some existing opportunities which help in
increasing market share . Market penetration is not suitable for Delievroo as they are not
coming up with existing product within existing market area.
 Product development – In this strategy company develops new products by targeting
their existing market share (Ge and et. al., 2018). Deliveroo is implementing product
development strategy within their working as they are coming up with something
innovative i.e., reduction in delivery time by 20% which simply means ordered item will
deliver in less than 30 minutes. With this innovative idea respective organisation is
coming up in their existing market area so they can attract more customers and serve
them in effective manner.
 Market Development – It this strategy firm seeks growth by targeting new market with
their existing products. Market development strategy is not suitable for Deliveroo as they
are delivering innovative services within existing market area.
 Diversification – Firm grow by diversifying within new business through developing
new goods by targeting new market area (Aarstad, Kvitastein and Jakobsen, 2019). Thus,
for Deliveroo product development is more suitable strategy as they are coming up with
something innovative idea in existing market area.
Appropriate Blue Ocean tools and frameworks
Blue Ocean strategy is simultaneous pursuit of differentiation as well as low cost to open
up new market space and also creating demand. In simple term, it can be said that blue ocean
strategy is all about creating and capturing uncontested market space as making competition
irrelevant. This entire strategy is based on market boundary and industry structure which is not
given because it can be reconstructed by the actions as well as beliefs of industry players.
Implementation of Blue Ocean strategy result in success of Deliveroo as there is large number of
competition within food ordering and delivering industry (Zhai and et. al., 2018). So, to
overcome with competition respective organisation is doing something innovative as they reduce
their delivery time by 20% and try to serve customers within 30 minutes after ordering food.
When an business firm have limited room to grow company try to look up for coming up with
new things as Deliveroo's reducing their delivery time. Thus, respective corporation can enjoy
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uncontested market share or Blue Ocean. Blue ocean strategy come up with complete set of
analytical tools as well as framework through which an organisation can execute blue ocean
strategic move. These are value innovation, strategy canvas, four action framework, six Paths
Framework, Pioneer Migrator settler map, three tiers of Noncustomers, sequence of creating a
blue ocean and buyer utility map (Metechko and Sorokin, 2018). Deliveroo company is
implementing Value innovation tool within their work as they are coming up with something
innovative in market area explanation of that are as follows :-
Value innovation - It is the synchronous quest for separation and minimal effort, making
a jump in an incentive for the two purchasers and the organization. The idea of Value Innovation
is created by W. Chan Kim and Renée Mauborgne and is the foundation of market-making
procedure. Since incentive to purchasers originates from the offering's utility less its cost and in
light of the fact that incentive to the organization is created from the offering's value less its cost,
esteem development is accomplished just when the entire arrangement of utility, cost, and cost is
adjusted. Apart from this, value of innovation is based on main two factors i.e., cost saving as
well as buyer value. In the cost saving company made by eliminating as well as reducing factors
which industry competes on. On the other hand, buyer value is lifted by raising and creating
elements which industry never offered before (Dodgson, 2018). Thus, Deliveroo is creating
buyers value as they are creating such services which is not available in food ordering and
delivering industry before. Innovative thing they are implementing is reduction in delivery time
by 20% which means that ordered item will deliver in less than 30 minutes after ordering.
Implementation of such creative idea have several advantages of Deliveroo such as they can
attract large number of customers, business growth, grabbing future opportunities available in
market and most important is that their delivery boy can able to deliver more order item per hour.
Deliveroo analyse entire market as well as its condition, current customers demand and
many more. All this is important because before coming with something new it is essential to
analyse business environment as well as current industry in which company is work so that
innovative idea take successful place. Thus, it has been identified by Deliveroo that customer are
facing issue with late delivery services of organisation working within this industry (Uvarova
and et. al., 2018). So by taking advantages of this issue respective organisation implement
innovative idea by reducing their delivery time by 20% and deliver ordered item in less than 30
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minutes. Through such practices Deliveroo Company will able to grab large number of
customers as well as better place within market area.
Set of conclusions that succinctly highlights the key aspects covered in the literature.
After going through literature it has been concluded that there are several driver of
innovation within an organisation can implement within their working for getting better place in
business environment. Along with this it is essential for an organisation to apply model of
innovation also in their working while coming up with something new as it will help them in
conducting their innovative operations in effective manner (da Silva Lopes, Casson and Jones,
2019). Apart from this there are several strategies which Deliveroo Company has been
implemented within their working while inventing new idea of reduction in delivery time by
20%. Such as porter's generic model in this organisation is using differentiation strategy call they
are coming with something different by covering large number of market. On the other hand
another strategy is Ansoff of matrix which utilise for growth of business the same organisation is
using product development as they are implementing innovative idea with their existing market
for their current customers. These mention strategies we provide assistance to company in
conducting or implementing new idea within their working in effective manner. Furthermore,
Deliveroo use Blue Ocean tool in their daily operations as it will help them in gaining success
within business environment and there are several tool of Blue Ocean Strategy out of which
companies using value innovation as they are bringing innovative idea in market which has been
discussed already.
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CONCLUSION
After going through above discussion it has been summarised that, it is important for an
organisation to implement business strategies in appropriate manner as these will be the only
which help in gaining competitive advantages. In addition to this there are several innovation
drivers which help a business firm to come up with something innovative within market area and
make customers satisfied by fulfilling their need and wants. Apart from this, there are two model
whose implementation is essential for an organisation as it help them to apply effective strategy
for gaining competitive advantages such as porter's generic model as well as Ansoff. In addition
to this, Blue Ocean is the strategy that provide assistance to company within their success.
Through implementation of Blue Ocean strategy corporation can enjoy uncontested market share
or Blue Ocean.
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