Professors: Online retail technologies have mixed results
October 15, 2014
WEST LAFAYETTE, Ind. — With the holiday shopping season approaching, online retailers are gearing up for increased customer visits and potential sales. But research by two Purdue University management professors found that some technologies online retailers frequently use are more effective than others.
Prabuddha De, Accenture Professor of Information Technology, and Mohammad Rahman, associate professor of management, both in the Krannert School of Management, along with former Krannert colleague Yu Hu, currently associate professor at the Georgia Tech Scheller College of Business, conducted the research. They partnered with a large online women’s clothing retailer to study the effectiveness of navigational technologies, such as search and recommendation systems, and product-oriented technologies, including a zoom-in feature, color swatches and alternative photos.
They found that recommendation systems, which give consumers alternate choices related to their original selection, increased sales by 5.5 percent. It's the first direct evidence of the economic value of such systems.
The results for product-oriented technologies varied. While the zoom function reduced product returns, the alternative photos resulted in increased returns. The color swatch technology had no discernable effect.
The researchers suggest that the zoom reduces returns because it provides factual information by allowing the consumer to closely see product details such as stitching and buttons. The alternative photos, almost always using a model, provide an impression but little or no factual information on how the product will look on the consumer.
They say that some retailers are beginning to allow customers to upload their own photos or videos showing the product being used, and these may well provide a more realistic experience for consumers.
Writer: Judith Barra Austin, 765-494-2432, jbaustin@purdue.edu
Sources: Prabuddha De, 765-494-0699, pde@purdue.edu
Mohammad Rahman, 765-494-4464, mrahman@purdue.edu
Note to Journalists: Video of professors De and Rahman discussing their study can be found at http://www.youtube.com/watch?v=D6l6Ktp8ASM&feature=youtu.be
