Digital Transformation Project – Kookpunt (Team 22)
The company selected for this study is Kookpunt, a brick and mortar kitchen supplies store founded by Ton van der Kolk sr. and Sjaan Neels in 1959, based at Noordplein, Rotterdam. Over the past 50 years the store has grown from a small 12m2 shop into the largest kitchen equipment supplier in the Benelux, with over 4000 m2 store space and has the most extensive kitchen items assortment. Our research is not focused on the physical store of Kookpunt, but rather on the online Kookpunt webshop launched in January 2012. The e-commerce channel of Kookpunt is actually an independent company working closely alongside the physical store. Although they are separate companies, both firms aim towards having the same business strategy and vision.
To obtain qualitative data we have conducted an interview with the co-owner of the webstore, Wouter van den Westen. In this interview we obtained information about the business model and strategy of Kookpunt. Based on this information we have made several recommendations.We have focused on the utilization of M-Commerce and CRM.
We recommend to adopt M-commerce. This technology is needed to anticipate on the growing trend of internet usages on mobile devices. The Webshop and the physical store aim towards the same vision and strategy. This same vision and strategy should also be used within the m-commerce. M-commerce fits with the current strategy. The biggest change for customers is that it expands the possibilities for accessing the webshop and therefore allowing customers to buy products at any time, wherever they are. Using m-commerce within Kookpunt refers mostly to a mobile storefront, adjusted for smartphones and tablets. Compared to PCs, the screen is smaller, the input methods and the way people use their mobile device are fundamentally different (Kourouthanassis & Giaglis, 2007). For the design of the mobile website these differences should be kept in mind.
Customers should be guided in their online purchases. Recommendations based on customer information can be provided. Currently there is nothing done with real-time information about customers. A way for Kookpunt to utilize customer data is through CRM. With this customer oriented feature Kookpunt can make personalized recommendations. This form of passive search tools is based on past product views or purchases and can increase sales. It allows customers to discover and purchase products that otherwise would not be considered, leading customers further down the long tail (Brynjolfsson et al., 2006). CRM can also contribute to a higher customer satisfaction, as it enables Kookpunt to customize their recommendations to better suit the customer’s individual tastes.
In the physical store of Kookpunt trading out behaviour is stimulated by informing customers and advising a product that best suits the ideal product the customer is looking for. The better the product fits with the ideal product the customers has in mind, the higher the willingness to pay (Clemons, 2008). Within the webshop this same effect might be achieved by personalized recommendations. The personalized recommendations can increase the fit with the ideal product, stimulating trading out behaviour because of the higher willingness to pay.
Currently sold products are not scanned. At the register the prices of the products are entered manually. There is no digital indication which product is being sold. Without tracking which exact products are being sold, it is impossible to make accurate predictions. Therefore is the inventory not accurate. Fortunately a scanning system is being introduced upcoming March. This system makes item management possible. This is a necessary first step in digitizing the company.
The implementation of CRM for the webshop is technically feasible. There is a lot of customer information available and as mentioned above, multiple ways to apply the technology within the current strategy. Suitable CRM software needs to be acquired. Multiple vendors offer specially designed CRM packages for SME’s. Many cloud-based alternatives are being offered. Important for making CRM a success within the company is staff with the necessary database skills to make use of the full CRM functionality (Alshawi et al., 2010).
Alshawi, S., Missi, F., & Irani, Z. (2011). Organisational, technical and data quality factors in CRM adoption—SMEs perspective. Industrial Marketing Management, 40(3), 376-383.
Brynjolfsson, E., Hu, Y. J., & Smith, M. D. (2006). From niches to riches: Anatomy of the long tail. Sloan Management Review, 47(4), 67-71.
Clemons, E. K. (2008). How information changes consumer behavior and how consumer behavior determines corporate strategy. Journal of Management Information Systems, 25(2), 13-40.
Kourouthanassis, P. E., Giaglis, G. M., & Vrechopoulos, A. P. (2007). Enhancing user experience through pervasive information systems: The case of pervasive retailing. International Journal of Information Management, 27(5), 319-335.