Case Study:

When everybody's busy, something's got to give. The online grocery industry (that is, grocery shopping online and home delivery of purchased items) has developed slowly over the past 20 years to address today's consumer demands of convenience and time savings. Perhaps the best known provider in the industry is Peapod.com , an operation that began outside Chicago. Since its founding in 1989, it has expanded to 18 U.S. markets, making over 10 million deliveries to over 270,000 customers. Other national competitors have entered the market, but only a few have had any staying power. One of these is netgrocer.com which delivers groceries and an assortment of other merchandise as well across the country using FedEx. In addition to larger multi-market online grocers, there have been many local providers.

Online grocery services typically provide virtual stores through which the electronic visitor navigates, as if pushing a shopping cart in a traditional grocer. The user clicks on items to purchase, which are placed in the user's cart. When complete, the user is ''checked out,'' specifying a delivery date and time. Users pay delivery costs proportionate to each shopping bill.

The software allows the user to store his or her preferences in a personal shopping list that can be altered, adding or deleting items as necessary with each e-visit. Across the various providers, the software also usually allows easy consumer comparison. For example, the SKUs in a particular category may be sorted by brand name, by price, by value (price per ounce, for example), by what is on ''feature'' (sale and point-of-purchase promotions), by various dietetic goals (such as ''healthy,'' ''low fat''), and so on. The user may write in ''notes,'' to specify in more detail, for example, ''Please pick up green (unripe) bananas, not yellow ones,'' or ''If Fancy Feast is out of beef, please get turkey instead,'' which instruct the professional shopper as to the user's particular preferences. Categories of items that can be purchased are continually expanding, from foods to drugstore items and other merchandise.

Online grocery providers tend to conduct the online business very well, if customer satisfaction, repeat visits, and word-of-mouth advertising are any indicators. That is, the software provided, the merchandise selected, the delivery reliability, and so on, are valued by the customer, with few complaints. Most users are women, employed full-time, and married, with well-above-average household incomes.

Samantha Gerard is an M.B.A. student, taking her last term of classes, and thinking about starting up a local online grocer. She's certain that by learning from the templates of the current providers in other markets, she, too, can run the logistics of the business. However, she hopes that, given her contacts with computer experts, she can create a competitive advantage in the software setup, if she understands the consumers' mindset as they travel through the e-grocery stores. She wants to know just what a user is thinking from the first click onto the Web site to the last ''Done Shopping'' click off the site.

This knowledge would allow her to offer better advice to her software developers in terms of what features would facilitate the visitors' navigation through the grocery store. Data like these would help improve the system, and it would also lend great insight to the consumers' decision processes.

Questions

1.What is the decision problem?

2.What is (are) the research problem(s)?

3.What types of errors might be committed here in defining the marketing research problem?

4.Explain how the impact of such errors can be reduced in this context.