Showrooms and Information Provision in
Omni-channel Retail
David Bell
Wharton School at University of Pennsylvania,Philadelphia,PA,USA
Santiago Gallino
Tuck School of Business at Dartmouth College,Hanover,NH,USA
Antonio Moreno
Kellogg School of Management at Northwestern University,Evanston,IL,USA
1.Introduction
Online and offline retail channels are increasingly intertwined.Traditional players are ramping up their Internet prence and online-first retailers are open-ing stores and showrooms,1and developing offline partnerships.This intermingling reflects the fact that while online retailing is by far the fastest growing re
tail ctor in the United States(according to Forrest-er Rearch the market will grow from$231b in2013 to$370b in2017on CAGR of10%),2offline retailing still anchors the ctor.Retailers of all types and in all locations,therefore,increasingly interact with con-sumers through multiple touch points(Brynjolfsson et al.2013,P.23).In the global consumer economy omni-channel retailers and buying experiences are now the norm.
Hence,for retailers,understanding how omni-channel“works”is imperative and our rearch makes a contribution in this regard.
First,we recognize that typical offline and online channels differ markedly in their ability to deliver information and product fulfillment,the two most criti-cal channel functions(,Coughlan et al.2006, Pp.9–10).An omni-channel retailer must respond to, and cater to,consumer heterogeneity in preferences for whether information is delivered in-store or online,or whether product is available in-store,or shipped.With regard to information in particular, some customers prefer the ea of shopping that comes from an online experience,whereas others pre-fer to physically sample products before buying them. Second,traditional online and offline channels also have very different cost structures depending on how orders are fulfilled.Online channels benefit from inventory pooling and lower inventory costs.On the other hand,decentralized offline channels,for exam-ple,traditional b
rick and mortar stores,have to fore-cast demand for each product and store.This is much harder to do on a per store basis than it is under the pooling that happens with an online channel.As a result,offline fulfillment usually experiences higher demand-supply mismatches and additional inventory costs.
Third,and converly,,Lal and Sar-vary1999)have long realized that when it comes to delivering visceral product information,that is,infor-mation about so-called“non-digital attributes,”off-line channels have a definite edge.Practitioners and analysts have made the same obrvation.Leading industry ,for example, had this to say about Warby Parker,the fashion eye-wear retailer and rearch partner for our study:“That(home try-on)has helped Warby Parker over-come one of the biggest hurdles(italics added)for online fashion brands,getting people to feel comfort-able about their online purcha.”3Numerous other online-first retailers rec-ognize that uncertainty about non-digital product attributes is a barrier to purcha for large gments of customers,and therefore employ free two-way shipping,pop-up stores,and related methods to com-bat it.
表格转置怎么操作The specific domain of our rearch is a new and increasingly common retail innovation favored by leading online-first retailers,the showroom.4As noted above,the are offline locations where cus-to
mers can physically examine products before placing an order,but orders are placed on a tablet or Internet-connected device in the store,fulfillment is done via shipping,that is,showrooms do not have products available for immediate in-store pur-cha.Thus,showrooms simply allow customers to obtain information prior to purcha by physically sampling products.This hybrid experience delivers information offline in a showroom yet maintains the inventory fulfillment efficiency of the online channel.
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Note that in markets where they are opened,the introduction of a showroom channel reprents a shock in the amount and quality of product informa-tion that is available to the customers,holding fulfill-ment options constant.We study the market impact of this shock on veral factors,including on overall demand,Web sales,and various elements of opera-tional efficiency,for example,product returns.
2.Methodology
错的英文To conduct this rearch on the impact of information provision on market behaviors,we partnered with Warby Parker,a leading US online-first retailer of fashion eyewear.Since opening for business in Febru-ary2010,Warby Parker progressively introduced showrooms in different locations throughout the Uni-ted States.Management provided us with detailed data on customer behavior and we augmented the data with a rich t of data on ZIP-level geographic factors obtained from the US Census and www.esri. org.
The institutional tting has important features that allow us to properly isolate the effect of informational differences on customer channel migration.First,eye-wear is a category with significant non-digital or“fit and feel”attributes such that direct online purchasing is difficult for some customers.5Second,Warby Par-ker began as an online-only retailer that also offered consumers a unique product sampling program nationwide called Home Try On(HTO)in which con-sumers could havefive pairs of glass(frames only and without lens)delivered to them free of charge for5days.Thus,we are able to identify changes in customer behavior when offline showrooms arefirst introduced into locations where there was already online and sampling coverage.Third,and crucially for our study,the offline locations opened(and clod)by Warby Parker throughout the United States are inventory only showrooms.The showrooms are existing offline stores operated by other indepe
ndent brands lling apparel and accessories.Customers entering the showrooms can physically inspect the entire Warby Parker product line and make a pur-cha in-store via the website,but cannot take their purchas with them.Fulfillment,conditional on a purcha,that is,shipment to the location of the cus-tomers choosing,is identical irrespective of how prod-uct information is obtained.That is,whether the purcha is made directly at the website,at the web-site subquent to an HTO experience,or at the web-site subquent to product inspection in a showroom, fulfillment is always via delivery.
The fact that Warby Parker opened and clod showrooms in different markets throughout the Uni-ted States during the period of analysis allows us to u quasi-experimental methods to asss the effect of the showrooms in the obrved market outcomes. We u a combination of a difference-in-differences strategy with a propensity score method adjustment. In principle,since only customers near a showroom, that is,tho within its trading area,can be influenced by the prence of the showroom,we can compare the difference in sales,returns,and other factors between ZIP codes within/beyond the area of influ-ence of the showroom,before and after the opening of the showroom.Now,becau management does not open showrooms“randomly”we also need to control for the endogenous nature of the treatment,that is, the opening of a showroom.We do this using a pr
o-pensity score adjustment(bad onfifty different ZIP code level factors)so that we compare treatment and control locations are made esntially identical in their obrvable characteristics,except for the pres-ence of a showroom.
3.Results
以安全为主题的画
We make two new substantive contributions to the omni-channel literature.First,we show that locations contained within the trading area of a showroom:(1) e an increa in overall demand,and(2)show evi-dence of spillovers from one channel to another. The estimated effects are statistically and economi-cally significant,and the overall positive demand impact alone is approximately10%.Interestingly,the positive demand impact is not solely attributable to sales through the(new)offline channel,that is,the showroom itlf.In the locations direct sales through website increa by up to7.0%as well.A physical offline prence ems to confer awareness,branding,and credibility benefits that deliver incremental sales through the existing online channel.Note that the benefits accrue from the provision of information alone,as fulfillment is identical in all three channels(Web,sampling,showroom). Next,wefind that sales through the sampling chan-nel decline and our cond contribution is to demon-strate that the underlying mechanism is channel migration by customers.We conceptualize a shop-ping process in which there
is a match between the information delivered by each channel(Web,sam-pling,showroom)and the information required by customers who vary in their tolerance for uncertainty. We predict that customers who have the least uncer-tainty tolerance are more likely to migrate to the offline channel when it is available.As a conquence,the pool of customers remaining in the sampling and online channels are,on average,better matched to tho channels.This leads to higher conversion from sampling,lower rates of repeated sampling,and fewer returns from sales made in the online channel.
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Production and Operations Management24(3),pp.359–368,©2014Production and Operations Management Society361
巨蟹座和双子座Our empirical results are consistent with the con-ceptualization and predictions.Thus,our study,to the best of our knowledge,is thefirst to identify and measure the critical impact of informational differ-ences across on customer migration and operational costs in an omni-channel tting.We also demonstrate that the positive economic impact of showrooms can be substantial.
In summary,when an online-first retailer opens showrooms,the channels are much more than a mechanism for just expanding awareness and total demand.They allow customers to“sort”into their p
referred channel on the basis of their information needs and,as a conquencefirms can greatly reduce the operational cost-to-rve customers through the other channels.
Notes
1By“showroom”we mean a retail location where the full product line is available for consumers to try,touch,and feel,however any product that is purchad cannot be taken away,that is,there is no in-store fulfillment and ful-fillment is done online.
/2012/09/10/warby-parker-rais-36-8m-to-expand-fashion-eyewear-brand.
4See,for example,M.Halkais,“E-Commerce Retailers Open Physical Locations in Dallas to Augment Online Stores,”Dallas Morning News,June4,2014,www. /business/commercial-real-estate/headlines/
5In entered the US eyewear market,only1–2%of all sales in the category occurred online.
References
Brynjolfsson,E.,Y.J.Hu,M.Rahman.2013.Competing in the age of omnichannel retailing.Sloan Manag.Rev.54(4):21–29. Coughlan,A.,E.Anderson,L.Stern,A.I.Ansary.2006.Marketing Channels.7th edn.Pearson/Prentice Hall,Upper Saddle River, NJ.
Lal,R.,M.Sarvary.1999.When and how is the Internet likely to decrea price competition?Mark.Sci.18(4):485–503.
How Company-Specific Production Systems Affect Plant Performance:The S-Curve Theory
Torbjørn Netland
好朋友歌词
Norwegian University of Science and Technology,N-7491,Trondheim,Norway
Kasra Ferdows
McDonough School of Business at Georgetown University,Washington,DC,USA
Ebly Sanchez
Volvo Trucks North America,Greensboro,NC,USA
冻疮怎么形成的
1.Introduction
Inspired by the Toyota Production System,many mul-tinational manufacturers have recently developed their own company-specific production systems.While there is a general connsus that the systems can boost plant performance,the literature does not offer an explanation for the pattern of this improvement. We propo that this pattern follows an S-curve:as a plant implements a company-specific production system,its performance improves slowly atfirst,then grows rapidly,then less rapidly,and,finally,the improvement rate tapers off.We developed this empirically grounded theory by using a ca rearch methodology.The ca is the implementation of the Volvo Production System(VPS)in Volvo Group’s67 factories worldwide.The data were collected from dif-ferent sources:a survey,Volvo’s formal audit process, and40plant visits,which included obrvations on the factoryfloor and200interviews with managers. We ud locally weighted regression to discern the pattern of improvement directly from the data.
The S-curve theory has significant managerial and theoretical implications.It suggests that managers should tailor their targets and action plans bad on the level of maturity the plant has reached in imple-Caro and Tang:POMS Applied Rearch Challenge2014Awards
362Production and Operations Management24(3),pp.359–368,©2014Production and Operations Management Society
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