The case of Best Buy, another traditional retailers that we're able to navigate the transition successfully, can help us remind ourselves of another essential asset that retailers have to navigate this digital transformation. The value of employees at all levels in the organization can be easily overlooked. It is fair to ask if the same people that were helping the retailer be successful a few years ago, are going to be able to lead the transformation and help the company succeed today. What is clear is that the role and task that the employees will need to do must change and adapt. It is true that there are a number of tasks that traditionally were performed by employees in physical stores and today in the digital store, are no longer relevant. In some cases, those tasks can be completed by implementing an algorithm or by buying a piece of technology. However, there are other tasks, old and new, where an engaged, well trained employee cannot be replaced. One way where the digital transformation can help in this space is by leveraging online training. In fact, this is in a way what you're doing right now. In a research project, I studied the impact that training can have in sales associates. My co-authors and I, were able to show that for each training module that an employee was taking to learn more about the products they were offering, each employee was increasing their sales by two percent a month and every sales associate could take anywhere from 1-12 training modules a month. You make the math. This engaging training modules were relatively short and delivered through an online platform. Here is a clear combination of the digital transformation and the traditional assets, the sales associates. Knowledgeable employees can drive sales and ultimately success for the retailer. Online training is a fantastic tool that can be a scale in a cost-effective fashion. In our study, the training was on different product features, but retailers can also train their employees on how to perform a task such as restocking or processing costumer returns. Employees can also be trained in the new way the company is planning to transform and adapt to the digital world. This well-trained and engaged employee can be a unique asset to change the organization from within. That employees can be an asset to increase and drive sales is not new and it should not come as a surprise. However, in a research project with my co-authors, Tony and David, we actually looked at the different effect that positive interaction with the retailer can have in future sales. Of course, this interaction includes the contact and engagement with the sales associate, but can also include other things, like the location, the store design, or the music you listen when you walk into the store. In our research, we call this impact the supercharging effect. The idea is simple. To understand the effect, let me make it parallel with the way we deepen a personal relationship. Think of the first time you connect with someone in an online setting. Maybe you receive the first text from that person, and later on a second text. These interactions give you some information and some hints on this person, what she might want, what are the expectations in the relationship? But later on, you have a third interaction over the phone this time and now you hear her voice, the tone, her accent. This is not only more information, but information of a different type. The quality of the information is different from the one you could receive in a text. Because of this information, you are now supercharging the relationship to a new level. After a few phone calls, you get to meet the person for the first time. Now you see the person, [inaudible] handshake, you see how she's dressed, if she's wearing perfume. Once again, more information, but more importantly, new type of information. The relationship is supercharging again and transitions to a new level. Well, this same logic can be applied to the way we interact with retailers and what happen with the interaction between the customer and the retailer when the customer visit the store. The supercharging effect is also happening when the customer transition from an online transaction to contacting the retailer through the call center and ultimately, visiting a physical store and interacting with the physical space and the sales associates. In our research project, we studied what were the benefits of a physical contact between the customer and the retailer. We saw how customers that were exclusively online customers and at some point in time, visit the showroom and move to a new level in the relationship with the retailer, benefit from that new type of information. The supercharging occur during that store visit and was helping the retailer increase sales and more than that. The supercharged customers were buying across more categories and products with higher prices, and make things even better when it comes to return because the returns of transactions, even those later transactions done online, were going down. The supercharging is successful when the physical presence of the retailer is carefully thought out and the employees that interact with the customers are well-trained. But in the same way that we can have a positive supercharging experience, we can have a negative supercharging experience. Again, it is important to recognize the anchoring of our strategy and support the rest of the strategy in all the different channels. The retailer needs to make sure that the employees know what they're supposed to do when they meet the customer and that the overall store execution is done well. This supercharging effect is one of the many reasons why a good number of digital native brands started to open physical stores. By doing that, they were able not only to have stronger presence and attract new customers, but also supercharge their relationship and increase the lifetime value of those digital native customers. Once again, to navigate the digital transformation, of course, it is fundamental to have a good understanding of what's happening in the digital world. But as relevant as that is, what is the retailer doing in the physical world to compliment and support that transition? Customers are going to be long-term customers when they value and benefit from an omni-channel experience that is successful both in the online and the physical world.
