Eataly Case

2228 Words Mar 26th, 2016 9 Pages
Eataly 1. Would you invest in Eataly?
Eataly’s successful integration of eating, shopping and learning has achieved great rewards, as its 50,000-square-foot Madison Square Park location does approximately $85 million in annual revenue. Its even larger counterpart in Chicago, which opened in late 2013, was on pace to hit $50 million last year (Carr, 2015). Eataly opened its New York store in 2010 with an initial investment of $20 million and by 2012, investors had recouped their initial investment (Collins, 2012). In 2012, Eataly accounted for about a third of Batali & Bastianich Hospitality Group’s $250 million annual revenues (Collins, 2015).
Eataly opened its first store in 2007, in a highly competitive, low-margin industry, and
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How did it create this?
Eataly follows a differentiation strategy by distinguishing its products on dimensions such as product design and quality (Bello, 2015). Oscar Farinetti, the founder, helped Batali & Bastianich Hospitality Group use related diversification corporate level strategies to effectively drive alignment between Eataly’s business and operating models (Bello, 2015). Eataly is not the traditional restaurant, grocery store, nor place to learn about food. It is a combination of the three and provides amazing and alluring food experience to guests. The coordination of these departments creates a synergy that allows Eataly to gain greater value than what would be created if each department operated separately (Bello, 2015).
The retail industry is redefining business formulas to maximize opportunities of interaction with consumers by developing service solutions to support value creation processes (Montagnini, 2009). Eataly represents an innovative, brand-new retail formula in the Italian food market, bridging retail and consumer education concepts to enhance guests value experience (Montagnini, 2009). Eataly’s business model is an attractive value proposition that has proven to be innovative and successful. This model is greatly executed by utilizing enormous spaces in high-traffic areas, which helps fulfil Eataly’s three tenants: eat, shop, and learn (Edwards, 2015).
Eataly USA is amenable to virtually any product that adheres to its core…

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