By Jonathan Riggs
Published Jun 09, 2014
Tuck assistant professor Santiago Gallino and co-authors David Bell of the Wharton School of Business and Antonio Moreno of the Kellogg School of Management were recently named winners of the inaugural Production and Operations Management Society’s POMS Applied Research Challenge.
The researchers were recognized for their paper, “Inventory Showrooms and Customer Migration in Omni-channel Retail: The Effect of Product Information,” which was reviewed by both a panel of academics and one comprised of practitioners, and presented at the 2014 POMS Annual Meeting Conference in Atlanta, Ga.
In the paper, Gallino and his co-authors show that in today’s world of multiple shopping avenues, customers self-select by how much they need to physically sample products before they buy them. Customers with a low need to physically touch or feel their purchases are most likely to prefer shopping online, while those with a higher need to do so might choose to visit a brick-and-mortar store.
The success of online U.S. eyewear retailer Warby Parker offers invaluable insight into the importance of ensuring both online and offline channels are maximized, the researchers say. Warby Parker initially gave customers the option to buy online or participate in a home-sampling program, where they would receive five pairs of eyeglass frames to test and then return after completing their purchase online.
The company then introduced display-only showrooms where customers could physically inspect the entire Warby Parker line before going online to make their purchases, an innovation that increased overall demand for the products and decreased the number of online returns. This suggests that both high-touch and low-touch customers were able to self-select and were thus happier with their shopping options.
“My co-authors and I are really proud of this project and how it’s so connected to what’s going on in retailing now—managers are finding it useful and cool,” Gallino said. “Being the first winners means so much to us too, because the competition itself is so aligned with POM’s mission of bringing academics and practitioners together.”
Competition chair Felipe Caro, an associate professor at UCLA’s Anderson School of Management, said the paper took top honors because of the exceptional quality of its “financial benefit; scalability to other industries and domains; managerial usability; and elegance, clarity, and depth of insight.”
Launched in October 2012, the competition aims to encourage both faculty and student members of POMS to conduct rigorous, relevant, and innovative applied research. All three finalist teams will publish an extended abstract of their work in the POM journal, with the winning team receiving a $2,000 honorarium.