E-commerce Retailers Research Articles

E-commerce Personalization with Elasticsearch

Personalization techniques are constantly gaining traction among e-commerce retailers, since major advancements have been made at research level and the benefits are clear and pertinent. However, effectively applying personalization in real life is a challenging task, since the proper mixture of technology, data and content is complex and differs between organizations. In fact, personalization applications such as personalized search remain largely unfulfilled, especially by small and medium sized retailers, due to time and space limitations. In this paper we propose a novel approach for near real-time personalized e-commerce search that provides improved personalized results within the limited accepted time frames required for online browsing. We propose combining features such as product popularity, user interests, and query-product relevance with collaborative filtering, and implement our solution in Elasticsearch in order to achieve acceptable execution timings. We evaluate our approach against a publicly available dataset, as well as a running e-commerce store.

Showrooms and B&M Stores: Omnichannel Strategies for Managing Customer Returns

E-commerce retail has witnessed a steady growth in sales with advances in digital technologies. However, one of the primary challenges that has plagued online retail is its inability to provide customers with the opportunity to “touch-and-feel” a product before purchasing, thereby resulting in a higher rate of product returns. To address this, online retailers, nowadays, are adopting various omnichannel configurations, such as operating an additional offline channel (i.e., either a showroom or a brick-and-mortar (BM 2) establishing a showroom (“Experience-in-Store-and-Buy-Online (ESBO)” channel) while selling the product online, and 3) selling the product through both a B&M store and the online channel while allowing in-store product returns (“Buy-Online-and-Return-In-Store (BORS)” channel). Additionally, we compare the retailer’s profit across various scenarios and propose several key managerial insights. Based on product attributes such as product standardization and product valuation, we recommend optimal omnichannel strategies for the retailer. For example, if the product is premium and highly personalized (e.g., designer apparel), the retailer should open an additional showroom.

China’s Online Retail Market in an Era of Technological Innovations

The immense scope of global e-commerce sales, expected to reach USD 4.48 trillion by 2021, is growing much faster than e-commerce and online retail legislation. In China, where the number of online shoppers is expected to reach 798.8 million by 2020 of which almost 42% use mobile devices for payment, lawmakers have been overhauling internet law, and its efforts reveal innovative methods and criteria deserve closer observation. The article will focus on the analysis of e-commerce from three legal aspects: contracts, consumer protection and unfair competition. This area holds vast practical relevance, especially in a world constantly shifting from traditional transaction and shopping methods towards internet-based technology and online transactions. Hence, the importance of legal recourse that is able to rapidly adapt to the technological developments introduced by e-commerce. The article’s findings indicate that specific regulation of e-commerce activities is vital in the virtual world, where conventional concepts of law and the laws themselves can be difficult to apply. From the analysis of the new PRC E-Commerce Law, it appears to be well-balanced in its goals by providing improved protection to all online trading parties and ensuring the safe development of China’s online economy. However, it still raises some questions that require of further debate and lobbying, as will be presented in the article itself.

Searching for the right operations strategy to manage the repair process across the reverse supply chain

Purpose of the paper: The paper aims to study the impact of different repair process strategies on a retailer’s product returns management operations by focusing on a make-or-buy analysis for an outsourcing-insourcing decision-making process. Methodology: An action-based research study on a single case study of an Italian small-sized retailer operating in the online commerce was carried out. Results: Results shed light on the determination of the repair process strategies implemented by the retailer, the identification of the returns rate and the cost and benefits of each single strategy, and the definition of the best practice to be selected. Research limitations: The main limitation of this research is the focus on a single case study that provides an insight on a specific industrial sector and on determined products. Practical implications: This study bridges existing gaps in the literature at both theoretical level, by presenting a further case study on the repair process strategies, and at practical level, by determining a fully focused step-by-step analysis of the managerial decision-making process, while choosing the best practice in a make-or-buy framework. Originality of the paper: This paper provides a make-or-buy analysis of the outsourcing-insourcing reverse logistics activities concerning an e-commerce retailer struggling with the best operations strategy to manage the repair process across the reverse supply chain.

Exploring the factors to make E-Commerce and M-Commerce ubiquitous and pervasive to improve national productivity of India

Electronic commerce (EC) and mobile commerce (MC) are leading edge technologies-based practices for doing global, local and context-based business but percentage of retail e-commerce sale in India in 2018 is expected as 1.4% (Retail Ecommerce Sales in India 2014-2018: Disappointing 1% of Total Retail Sales, https://dazeinfo.com/2015/01/07/retail-ecommerce-sales-inindia-growth-2014-2018-report), which is very low as compared to total commerce transactions, and it shows that it is not ubiquitous, though wide penetration of ICT (internet and PC, mobile penetrations) (IAMAI, 2016). So, the aim of this study is to find the ways and means to make EC-MC-based practices pervasive and ubiquitous to improve national productivity in India. This study is an attempt to specify mathematical equations using regression modelling, to describe the relationships between factors to make EC-MC-based practices ubiquitous and pervasive in India and productivity improvements as proposed by theory. The design methods and procedures used in this study are based on statistical theory to obtain representative samples from the real world.

The Effects of Visual Control Mechanisms on Touch-Based Mobile Devices

A major limitation for e-commerce retailers remains the lack of physical touch and feel of products before purchase. Potential buyers may be reluctant to purchase such products online because of the limited ability to evaluate physical product attributes and to infer their performance in digital media. Retailers have been addressing this limitation by implementing visual product presentation technologies such as zoom and alternative photos. In addition, the widespread adoption and use of smartphones and tablets for online shopping poses another challenge for e-commerce retailers because of the devices’ smaller displays and thus limited ability for visual product presentation. In this paper, we empirically investigate how the combination of visual product presentation technologies – via zoom and alternative photos – on mobile as well as non-mobile devices affect sales in online shopping. By utilizing a randomized field experiment, we find that alternative photos are associated with an increased purchase likelihood, while zoom is associated with a decreased purchase likelihood. For the devices, we find that the highest purchases likelihoods can be observed on PCs and tablets – potentially acting as substitutes for each other – followed by smartphones, which may be explained by their smaller display sizes. However, there is no significant interaction between devices and product presentation technologies. We also demonstrate the robustness of our results and discuss implications for e-commerce retailers.

Randomized Product Display (Ranking), Pricing, and Order Fulfillment for E-commerce Retailers

Problem definition: We study a joint product framing and order fulfillment problem with both inventory and cardinality constraints faced by an e-commerce retailer. There is a finite selling horizon and no replenishment opportunity. In each period, the retailer needs to decide how to “frame” (i.e., display, rank, price) each product on her website as well as how to fulfill a new demand. Academic/Practical Relevance: E-commerce retail is known to suffer from thin profit margins. Using the data from a major U.S. retailer, we show that jointly planning product framing and order fulfillment can have a significant impact on online retailers’ profitability. This is a technically challenging problem as it involves both inventory and cardinality constraints. In this paper, we make progress toward resolving this challenge. Methodology: We use techniques such as randomized algorithms and graph-based algorithms to provide a tractable solution heuristic which we analyze through asymptotic analysis. Results: Our proposed randomized heuristic policy is based on the solution of a deterministic approximation to the stochastic control problem. The key challenge is in constructing a randomization scheme that is easy to implement and that guarantees the resulting policy is asymptotically optimal. We propose a novel two-step randomization scheme based on the idea of matrix decomposition and a re-scaling argument. Managerial Implications: Our numerical tests show that the proposed policy is very close to optimal, can be applied to large-scale problems in practice, and highlights the value of jointly optimizing product framing and order fulfillment decisions. When inventory across the network is imbalanced, the widespread practice of planning product framing without considering its impact on fulfillment can result in high shipping costs, regardless of the fulfillment policy used. Our proposed policy significantly reduces shipping costs by using product framing to manage demand so that it occurs close to the location of the inventory.

Pricing Research for a Dual-channel Supply Chain with Free Riding Behavior

As the science and technology are leaping forward, online channels progressively gain the favor of customers based on their unique shopping experience that differs from the traditional retail channels, and establish a dual-channel retail model with the traditional retail channels. The differences between channels will enable consumers to first experience products or services offline, and then buy products online at a cheaper price. This has formed a free-riding effect. Under such effect in dual channels, how e-commerce retailers and traditional retailers determine the price of channel products is to be discussed in this paper. Based on a brief exposition of the current economic environment, the research status of dual-channel and free-rider vehicles is first analyzed to locate the research work of this paper. Then, under this circumstance, the situation is addressed that e-commerce retailers have zero service levels, and the traditional retailer can provide services and establish a pricing game model, the product's dual-channel pricing strategy is analyzed by using the game model. Finally, the actual availability and effectiveness of the built game model are verified with the example analysis.

Picker routing in the mixed-shelves warehouses of e-commerce retailers

E-commerce retailers face the challenge to assemble large numbers of time-critical picking orders, of which each typically consists of just a few order lines and low order quantities. To efficiently solve this task, many warehouses in this segment are organized according to the mixed-shelves paradigm. Incoming unit loads are isolated into single units, which are randomly spread all over the shelves of the warehouse. In such a setting, the probability that a picker always finds a demanded stock keeping unit (SKU) close-by is high, irrespective of his/her current position in the warehouse. In spite of this organizational adaption, picker routing, i.e., the sequencing of shelf visits when retrieving a set of picking orders, is still an important optimization problem. In a mixed-shelves warehouse, picker routing is much more complex than in traditional environments: Multiple orders are concurrently assembled by each picker, many alternative depots are available, and items of the same SKU are available in multiple shelves. This paper defines the resulting picker-routing problem in mixed-shelves warehouses and provides efficient solution methods. Furthermore, we use the developed methods to explore important managerial aspects. Specifically, we benchmark mixed-shelves storage against traditional storage policies for scenarios with different ratios between small-sized and large-sized orders. In this way, we investigate whether mixed-shelves storage is also a suitable policy if an omni-channel sales strategy is pursued, and large-sized orders of brick-and-mortar stores as well as small-sized online orders are to be jointly processed by the same warehouse.

Customer-Based Corporate Valuation for Publicly Traded Noncontractual Firms

There is growing interest in “customer-based corporate valuation”—that is, explicitly tying the value of a firm’s customer base to its overall financial valuation using publicly disclosed data. While much progress has been made in building a well-validated customer-based valuation model for contractual (or subscription-based) firms, there has been little progress for noncontractual firms. Noncontractual businesses have more complex transactional patterns because customer churn is not observed, and customer purchase timing and spend amounts are more irregular. Furthermore, publicly disclosed data are aggregated over time and across customers, are often censored, and may vary from firm to firm, making it harder to estimate models for customer acquisition, ordering, and spend per order. The authors develop a general customer-based valuation methodology for noncontractual firms that accounts for these issues. They apply this methodology to publicly disclosed data from e-commerce retailers Overstock.com and Wayfair, provide valuation point estimates and valuation intervals for the firms, and compare the unit economics of newly acquired customers.

The Dynamic Impacting Study of Competitive Strategies to Import Retail E-Commerce Sellers

The authors investigated several import retail e-commerce sellers through questionnaires and selected several types of variables based on Porter's competitive strategy theory. Then the authors used the panel data to empirically verify theoretical consumptions based on samples got by Python method from Jingdong Global Purchases and Tmall International, the top two e-commerce platforms in China. Results validated the three major competitive strategies that could enhance the competitive advantages to import retail e-commerce sellers. As it was not applied to all platforms and commodities, sellers should make different strategies through different platforms and commodities. This article has theoretical significance that filled in the gaps on import retail e-commerce sellers' competition. It also has certain practical significance by providing references for sellers on how to improve their competitive advantages, promote healthy competition and development of the import retail e-commerce, even to facilitate the structure adjustment of consumption and foreign trade in China.

How the U.S. Census Bureau e-commerce figures overestimate output and online sales

I identify biases in the definition of e-commerce employed by the Census Bureau. They arise from using a concept based on the role of ICT in a transaction that is measured empirically on the basis of sales/revenues. I quantify this bias as a measure of output growth in the retail sector for the most important e-commerce retail sector at the NAICS 4-digit level (4541). In addition, a range of estimates for the bias as a measure of the growth of actual online sales in this sector is derived. Potential solutions are provided in a concluding section.

Price Markdowns to Induce Customers to Opt Out of Free Returns

We study a newly emerging product return policy in the retail e-commerce industry. Alongside the conventional free return option, consumers (who face valuation uncertainty pre-purchase) are offered an additional return alternative called opt-out of free return (FO). If the free return option is chosen by consumers, they can return the purchased item over a predetermined grace period for a full refund. However, if consumers forego free return and self-select FO, the firm offers them a price markdown. If the consumers pick this option, they can still return the product during the grace period, but they will have to pay a fixed penalty and a variable penalty proportional to the product's purchase price. With consumers increasingly relying on online shopping, returns have become a considerable issue for e-retailers. This research is primarily motivated by practice where a major e-retailer (Jet.com, the new e-commerce operation of Walmart) has recently initiated implementing the FO policy for some categories of their products. We aim to derive managerial insights on when offering FO would be beneficial to firms, and if they offer it, how the firm can set the optimal markdown level. We formulate the problem as a stochastic optimization problem and analyze and characterize the structure of the optimal policy. We characterize the conditions that lead to the offering of the FO option alongside the free return option. (i) We find that the uncertainty level in the consumers' valuation distribution has a subtle impact on the profitability of providing the FO option alongside the free returns. While conventional wisdom suggests that offering the FO option is more likely to be beneficial as customers' uncertainty about the product's valuation pre-purchase increases, we show that the opposite could be true. Specifically, we show that if the product's expected valuation is large, higher uncertainty in the valuation distribution makes it more likely that offering FO alongside FR is advantageous to the firm. However, with low expected valuation, the lower the uncertainty in consumers' valuation distribution is, the more likely that the FO option is advantageous. (ii) We also examine how the profitability of the FO option is affected when the product's valuation (stochastically) decreases. We find that the salvage value of returns plays a crucial role in how the firm can benefit from offering the FO option as product's valuation decreases. Specifically, offering FO along with FR is more likely to be beneficial as consumers' valuation decreases if the salvage value of a returned product is sufficiently small. Our analysis reveals that offering FO alongside free returns can indeed have a significant positive impact on a retailer's profitability across various settings, demonstrating that the FO policy can be effectively used as a practical remedy in retail to partially recoup the revenue losses associated with returns.

An exploratory study on e-tailing in United Arab Emirates

The advent of the internet has dramatically changed the retail landscape. Online shopping is a thriving market, it is assumed that retail e-commerce sales worldwide will be doubled between 2016 and 2020. Online purchases or e-tailing has been increasing annually since last several years, but it accounts a small percentage of total retail sales. With the potential for growth being relatively unlimited in e-tailing mode, many online businesses have emerged during the recent past. Today, the conventional retailers are questioning whether their current brick and mortar business model will continue to be successful or to meet the new challenges they should adapt to click and brick model i.e. adding the e-tailing mode to their conventional physical store model. They found that e-tailing has already evolved and accepted at large in many developed countries but the culture of e-tailing is yet at its infancy in the developing countries and regions like Middle East. The purpose of this paper is to examine the nature and scope of online business (e-tailing) in United Arab Emirates; with special reference to Dubai- a world-class destination for retailers and shoppers.

HOW NUTRITION-FACT INFORMATION INFLUENCES ONLINE FOOD SALES

HOW NUTRITION-FACT INFORMATION INFLUENCES ONLINE FOOD SALES

Hotel Website Quality that Influences Customers' Purchase Intention

Purpose – The purpose of this study is to investigate the relationship between the website quality that leads to customers’ perceived flow and their purchase intentions on the website. Design/methodology/approach – A theoretical framework is used for this study. A total of 50 questionnaires were collected to empirically test the measurement and structural model. The results are based on regression analysis and equation modelling by using SPSS software. Findings – The findings confirm that hotel website quality influences customers’ perceived flow, which in turn influences their intention to purchase. Furthermore, perceived flow also mediates the relationship between the hotel website quality and the purchase intentions. Practical Implication – This study is able to help those who are in the hospitality industry and can also help future researchers as a guide for their research in the same or relevant scope of study. Originality/value – Hotel website quality, perceived flow, customer satisfaction and purchase intention altogether are not well not well understood in current literature despite the important implication for managers, academicians and consumers alike. This study contributes to the field of e-commerce marketing, retailing and e-tourism research. Paper type – Research Paper

Electronic Word of Mouth, Cross-Border Logistics Way and Imports Retail E-commerce

This paper mainly discussed how to improve Chinese import retail e-commerce sellers’ competitive strategy. We took Porter's competitive strategy which includes product optimization strategy, cost leadership and reputation priority to analyze the competition through import retail e-commerce sellers. We have done the survey through questionnaire to several import retail e-commerce enterprises from 7 cross-border e-commerce pilot cities. We have chosen 3 kinds of best-selling goods with 150 sellers on Tmall International, observed 27 weeks and collected 4050 samples of business data. We took panel data regression to validate theoretical assumptions, and results support most of theoretical assumptions. We took another 2 variables to do the robustness test. The conclusions and suggestions would help to improve the competition strategy of imports retail e-commerce sellers. Furthermore, it would be a good proposal to the development of Chinese cross-border e-commerce market.

How convenient is it? Delivering online shopping convenience to enhance customer satisfaction and encourage e-WOM

The purpose of this article is to identify which dimensions of online convenience affect consumers’ intention of using online shopping and explore a conceptual model to measuring consumer perceptions of online shopping convenience in order to surpass the shortcomings of previous studies that did not examine the consequences of convenience shopping experience. A sample of 250 Portuguese young individuals participate in the empirical study. Confirmatory Factor Analysis (CFA) and a covariance-based Structural Equation Model (CB-SEM) were used to validate the measurement model and to test the relationships in the model. The results reveal that Possession, Transaction, and Evaluation are the dimensions with more influence in online shopping convenience. The outcomes of this study extend previous works on online convenience and help to understand which factors drive online satisfaction and enhance behavioral intentions and e-WOM. Contributions to the body of knowledge and the implications for e-commerce retailers are presented. In face of the findings, retailers should be conscious that customer expectations of online convenience have increased as a natural response to the service innovations introduced by website managers and marketers. Therefore, frequent monitoring of consumers’ perceptions and expectations about online convenience is a prerequisite for achieving continuous improvement in rendering highly convenient online service.

The Dark Side of Technological Progress? Impact of E-Commerce on Employees at Brick-and-Mortar Retailers

Using an employer-employee payroll dataset for approximately 2.6 million retail workers, we analyze the impact of the staggered rollout of a major e-commerce retailer's fulfillment centers on the income and employment of workers at geographically proximate brick-and-mortar retail stores. We find that the establishment of an e-commerce fulfillment center in a county has a negative effect on the income of retail workers in that county and in neighboring counties within 100 miles. Wages of hourly workers, especially part-time hourly workers, decrease significantly. This decrease is driven by a drop in the number of hours worked. We observe a U-shaped pattern in which both young and old workers experience a sharper decrease in wage income. Consequently, in these counties, there is a decrease in credit scores and an increase in delinquency for retail workers that have higher prior credit utilization. Using sales and employment data for 3.2 million stores, we find that retail stores in counties around fulfillment centers experience a reduction in sales and in their number of employees. Further, there is a decrease in entry and an increase in exits for stores in the retail sector, with small and young retail stores exiting at a higher rate. Our robustness tests show that our results are unlikely to be driven by prevailing local economic conditions. Overall, our results highlight the extent to which a dramatic increase in e-commerce retail sales can have some adverse consequences for workers at traditional brick-and-mortar stores.

Customer-Based Corporate Valuation for Publicly Traded Non-Contractual Firms

Abstract There is growing interest in “customer-based corporate valuation,” explicitly tying the value of a firm's customer base to its overall financial valuation using publicly disclosed data. While much progress has been made in building a well-validated customer-based valuation model for contractual (or subscription-based) firms, there has been little progress for noncontractual firms. Non-contractual businesses have more complex transactional patterns because customer churn is not observed, and customer purchase timing and spend amounts are more irregular. Furthermore, publicly disclosed data are aggregated over time and across customers, are often censored, and may vary from firm to firm, making it harder to estimate models for customer acquisition, ordering, and spend per order. The authors develop a general customer-based valuation methodology for non-contractual firms which accounts for these issues. They apply this methodology to publicly disclosed data from e-commerce retailers Overstock.com an...