Universitat Oberta de Catalunya

Your talk at the workshop dealt with insights into retail from research and practice. However, there is often a sizeable gap between theory and practice. Is this also the case in your area of work?

In the world of retail - both on-line and in physical stores - this gap is indeed sizeable. Because on the one hand we have increasingly large and complex companies and on the other, customers who are more active in comparing products and have more places to buy. So these retailers are now moving large quantities of data on customer loyalty, on what they like and what they don't, on how and when they buy...

They know more and more about their customers.

Exactly. But despite the existence of such large amounts of data, those of us in academia often find it difficult to get access to them for our research.

Do companies not want to give you this information?

Some do, but others don't. They are reluctant to share this information with us, and if they don't it is much harder to bridge the gap between theory and practice. It is now even more difficult to get our hands on these data, because retailers have so many channels for selling their products (physical shops, on-line retail, mobile devices, social networks...) that they need to coordinate and manage the information these channels generate, which is integrated into a database that they can then use as the basis for their best business decisions.

What are the reasons for this refusal to cooperate with researchers?

There are a number of reasons, but the main problem is that they know the results of our academic research are published, and in many cases they do not want the competition to gain access to their data.

However, we don't need the data to know that e-commerce is growing.

That's right, and when I speak to retailers I always explain that behind e-commerce there are four E's that they need to focus on. The first is 'excitement', because they have to understand how to excite their audience.

And if they're not excited, they don't buy.

That's right. There are two reasons for customers to get excited. The first is because you are offering them a quality product that no one else can offer - and many retailers have been astute in offering quality, branded products that aren't available from other stockists. The second is the offer of good prices; if you have a product at an affordable price you will attract a good number of potential customers to your website.

And the other E's?

The second is 'education'. Customers need to be educated when they access a company's website; this means telling them about the benefits of the products, emphasising the security of the payment system, offering customer support to those who encounter problems, and so on.

And the third E?

'Experience'. For example, in a clothes shop I can try something on, whereas on-line retailers must think about how to produce a virtual equivalent of this experience. One solution is to provide a full 360º view of the same piece of clothing, which allows the customer to see it in more detail. Retailers could even look into enabling customers to provide their measurements and then viewing how the clothes would fit.

And the last E?

The fourth is 'engagement', because if customers like what they buy they tweet about it and tell their friends about how good the brand is. So it is the customers themselves who talk to other consumers about the benefits of the product. These are the four E's that enable a company to succeed in on-line sales, following the example of Amazon, which is the world's leading online retailer.

You referred before to the different sales channels, in particular mobile phones. Is this one of the trends that is currently on the rise?

Yes. It is definitely growing, because if we look, for example, at Scandinavian countries we will see that it is more and more common for people to have a mobile phone. In that part of the world they have reached a point where soon everyone will have one. On top of that, we will get to a stage where all of these phones are smartphones and all buildings have Wi-Fi access, so people will be able to buy whenever they want using their mobiles.

How long before we are in that situation?

In my view, most countries are working towards achieving it in the next two years.

Has e-retailing changed the rules of business, or do the same rules still apply? Is it the way we go about buying that has changed?

The rules of the business world are essentially always the same, but the way we buy and the speed with which we do it have definitely changed. Now you can sit down in front of your computer and go shopping.

But in this new scenario we can't all be winners. Who stands to lose out?

The losers are those businesses that aren't moving fast enough. One example is the electronics sector. In countries like the United Kingdom, most stores selling electronic products have been pushed out of the market. Some companies have not realised that consumers can now see and experience how a particular model of television works on the Internet; you can view and buy these types of products on websites like Amazon, with the added bonus of buying them more quickly. Nevertheless, those who commit to electronic commerce should not segregate it from other operations; e-retailing cannot be a stand-alone channel, it must be integrated with the rest of the business.

And what role do social networks play in this on-line scenario?

Social networks are - as the name suggests - a network. And if you become a major presence and attract a lot of followers, you're listened to, retweeted, and can influence thousands of people at a keystroke, which is impossible to do simply by speaking. So the power of social networks is this rapid, exponential multiplier effect.

How should companies be operating in social networks?

My model for businesses with a presence in social networks is 'listen, analyse and act'. First they need to listen to what people are saying, then they must analyse the information they have obtained in real time, as quickly as possible. Finally, they should do something with this information. They must act by offering a specific product and correcting previous errors, and they must do this within a period of 24 hours. Social networks have become so important that business managers want to be constantly up to speed with what's being said. The conversation flow on social networks has been raised to the highest levels of business, rapidly reducing the distance between executives and the people on the street.