They are scrutinising home shopping trends and experiences in order to help businesses trade more profitably and to help them better understand customer demands.
The UK is already at the forefront in Europe of e-commerce, with consumer internet purchases as a percent of retail sales second only to the United States. According to analyses, some 38 per cent of UK households have internet access whilst 51 per cent of the population have used the internet at home or work [UK Online Annual Report 2001], leading to approximately £20 billion of goods delivered last year and estimates placing this figure at nearly £35 billion by 2005 [Foresight @Your Home Report 2001].
Co-Director of the University's new Home Shopping Research Unit (HSRU), Niall Piercy, says: "E-commerce is a phenomenon that cannot be ignored". He also believes the UK has the opportunity to build upon its early successes in this area and become a world leader.
"To achieve this pre-eminence, companies and policy makers must understand and appreciate the fundamentally different operating environment that e-commerce provides and the opportunities and threats this implies. We intend that the Home Shopping Research Unit will be a leading advisor of both business and government in this area."
The recent collapse of many high-technology, internet companies has highlighted the difficulty of achieving profitability in the e-commerce marketplace. Critical in the collapse of many of these companies has been a failure to understand the necessity of efficiently and effectively serving customer needs as a path to profitability.
"Companies increasingly realise that succeeding in e-commerce requires not just having an attractive website, but the operational and logistical skills and competences to deliver on the value promise made to consumers at the time of purchase, and to do this profitably. Achieving this delivery is proving exceptionally difficult in practice," said Mr Piercy.
Consumers who shop online for increased convenience are also being disappointed by companies that cannot live up to expectations and promises made about speed of delivery, product availability and price. Estimates suggest that only 35 per cent of customers consider their online shopping experiences satisfactory (see note 1), with 50 per cent defecting before they make their third purchase (see note 2).
"If meeting the needs of increasingly demanding customers weren't challenge enough, companies will soon have to contend with increased legislation on e-commerce," Mr Piercy adds.
UK and European authorities are already paying increasing attention to e-commerce legislation in relation to: the environmental impacts of delivery options and increased packaging, urban planning requirements of increased commercial traffic, and the social inclusion and exclusion of e-commerce.
"By working with the Home Shopping Research Unit, companies will have the opportunity to contribute towards these policy developments, as opposed to being forced to simply conform when they are enacted," said Mr Piercy.
The HSRU is currently seeking partner companies who operate or are considering operationalising e-commerce home shopping strategies to collaborate on the research project. On 9 October 2002 the Home Shopping Research Unit will also host a free one day launch conference in Cardiff University for commercial organisations, institutions and academics interested in the research of the group.
For more information visit the web-site at www.HSRU.org.uk
Notes to editors
Note 1: Dodson, J. 2001. "E-Retailers Must Step Up Customer Support." Internetweek. Manhasset. Jan 8, 2001.
Note 2: Reicheld, F. & Schefter, P. 2000. "E-Loyalty: Your Secret Weapon on the Web". Harvard Business Review. July-August 2000.
Cardiff University is recognised in independent Government assessments as one of Britain's leading research universities. In the latest Research Assessment Exercise the University was placed 7th in the United Kingdom. The Home Shopping Research Unit is based within the Business School with participants from the Logistics and Operations Management Section and the Lean Enterprise Research Centre (both internationally recognised centres of excellence), the newly formed Business Relationships, Accountability, Sustainability and Society (BRASS) centre, as well as leading academics from other departments and universities in the United Kingdom.