Seeing Grocery in a New Light: Investigating Oda Norway's firm specific advantages in the Finnish grocerymarket.

Abstract

With Oda having experienced a rapid growth ever since its debut in 2013, the increased online interest following the pandemic further accelerated the company’s upwards trajectory. With its 70 percent market share of the online grocery segment in Norway and a unicorn title in 2021, the company attracted powerful investors. This led to the possibility of expanding, where the choice fell on the international scene rather than solely focusing on domestic growth. We investigate Oda’s firm specific advantages (FSAs) and the extent to which these are transferable to the Finnish grocery market. To answer this question, we have mainly utilized secondary sources of information, including financial statements, reports, press releases, news articles, and podcasts. The information has been analyzed through literature frameworks such as, the business model canvas, Porter’s competitive advantage, competition analysis, international business, and behavioral economics. We applied the VRIO framework from the resource-based view, Porter’s ten cost drivers from the activity-based theory, and the complementarity framework by Porter and Siggelkow to identify Oda’s FSAs. The company’s FSAs in its home country are found to be the business model in its entirety. This is substantiated by the many complementary activities and valuable resources found when analyzing the company’s business model. The most important are the interplay between, the logistics competency and self-made logistics system specialized for grocery, the pickers in production and the logistics system, and the integrated delivery service coupled with the order processing system. In addition, the valuable resource found in the company’s centralized warehouse is crucial for Oda’s success. The Lien et al. framework was used to explain the FSAs in the context of the Norwegian grocery market and the associated competition. A comparison between the Norwegian and Finnish grocery market was made to identify differences in the two markets. These were included with the literature of liability of foreignness (LOF) to explain the potential challenges one might face as a foreign company. Oda’s most evident sources of LOF are challenges related to securing supplier deals, the Finnish consumers slightly differing preference, and potential market responses from the established competition. These findings require awareness from Oda, however, the business model in itself is found to be replicable in the Finnish market while still contributing to a FSA. This is especially true as no business model in the Finnish market was of similar nature to Oda’s model.