San Francisco Seminar 2006
Day 4
Multi-channel strategy and the online renaissance
Introduction and context
The penultimate day of the San Francisco seminar marked the transition from innovation and entrepreneurship to practical business strategy and digital value creation.
Through IBM and Dr. Kirthi Kalyanam, it became clear that the customer journey has become the very arena of competition, and that data is the core of all growth, loyalty and efficiency. In 2006, many companies were still on the threshold between physical stores and digital channels.
Day 4 showed how the world's most forward-thinking companies were already thinking holistically: Customers want to move seamlessly between channels — so businesses must do the same.
Program overview
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Day 4 – Monday, March 13, 2006
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Craig Stevenson (IBM) – Multi-Channel Solution Overview
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Dr. Kirthi Kalyanam (Santa Clara University) – The Renaissance in Internet Retailing
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Main academic topics
IBM – Multi-Channel Retailing Solutions
Craig Stevenson presented IBM's extensive study of 450 senior executives globally.
It revealed two key goals in 2006 — growth and cost control — while customers became more informed, impatient, and disloyal. “Customer experience is the new battleground.”
Main points:
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Friction costs: 50% of multichannel customers switch providers when the experience is inconsistent.
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Web is not an add-on: Online shopping must be integrated into the business strategy, not run as a separate project.
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Seamlessness creates loyalty: One customer image, one product inventory, one experience – regardless of channel.
IBM highlighted three typical barriers in the retail sector:
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Fragmented order and inventory management (53%).
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Lack of sharing of customer data (50%).
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Budget and bonus structures that favor single channels.
Recommended solutions:
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Single View of Customer – consistent data across channels.
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Unified Product & Content Management – the same product information everywhere.
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Guided Selling and eKiosk – bringing digital tools into stores.
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Next Gen Contact Center – from support to the sales arena.
The essence:
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IT must support business strategy — not the other way around.
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Success requires organizations that think like the customer, across internal silos.
Dr. Kirthi Kalyanam – The Renaissance in Internet Retailing
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2005: Online share passed 10% of total US retail.
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Online players reported ~28% margin, compared to chain stores' 6%.
Drivers for profitability:
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Sharp reduction in marketing and technology costs (-73% from 2000 to 2004).
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Efficient logistics and customer service driven by data.
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Increased use of automation and content management.
Customer satisfaction:
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According to the American Customer Satisfaction Index (2005), e-commerce scored higher than physical retail – Amazon received 88/100. Price, experience and assortment were the most important factors. (See also examples of measurement via ForeseeResults in Navico)
“ The Long Tail ” effect:
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The web removed the limitations of shelf space – niche products could provide overall volume and margin.
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More choices, wider selection and personalized suggestions = increased customer value.
Shopping Cycle 2.0:
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Finding products (search engine, filtering, guiding)
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Evaluate (ratings, 3D views, comparisons)
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Shop (wishlist, one-click payment, flexible deliveries)
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Get delivered and follow up (tracking and alert systems)
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Returns (omnichannel and frictionless)
Future competitive advantage (as of 2006):
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Visualization – images, zoom and virtual models.
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Personalization – data-driven product proposal.
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Contextual experience – tailored to the user's situation.
Case studies
Kalyanam presented figures from Shop.org and Santa Clara University that showed that lower technology costs and better customer satisfaction were the keys to e-commerce's success.
The IBM cases demonstrated how integrated systems and customer data created competitiveness and margin growth.
Reflections and discussion:
Day 4 challenged participants to see online shopping and retail as two sides of the same value chain.
Digitalization was no longer about technology — but about customer understanding, data flow, and business logic. Discussions centered on how Nordic companies could break silos, build PIM systems, and invest in personalization, while American players were already years ahead.
International perspectives
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USA: Clear integration of channels and focus on experience-driven retail.
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Norway: Web projects were still treated as “add-ons” – without strategic anchoring.
This difference became an important learning point:
Digital maturity is not technology, but culture and leadership.
What did we take home with us?
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Multi-channel is not an option — it's a survival strategy.
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Seamlessness and data quality create loyalty and margins.
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The customer's expectation is a personalized, accessible and frictionless experience.
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Organizations must measure value creation across channels, not within them.
Relevance today
In 2025, many of the insights from 2006 still hold true:
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“Customer experience as battleground” is now a global fact.
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Norwegian retailers still have untapped potential in omnichannel.
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Artificial intelligence and data analytics have become the driving force behind personalization at scale.
Day 4 in San Francisco 2006 thus became a harbinger of the future:
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Those who manage to unite technology, data and empathy – they win the customer's trust and the future of the market.
Peder Inge Furseth
Peder Inge Furseth was a central academic driving force behind the San Francisco seminars and helped make the meeting with Silicon Valley relevant for Norwegian and European businesses. Through his role as professor at BI and as academic director of the program, he helped the participants put the lectures into a larger context – where technology, innovation, business development and people had to be seen in context.
In San Francisco, participants met entrepreneurs, researchers, technology leaders and investors from some of the world's most innovative environments. Furseth's strength was his ability to connect these experiences to practical challenges and opportunities in Norwegian businesses. He helped translate Silicon Valley's ideas and working methods into a Nordic context where collaboration, trust and long-term value creation are strong.
Throughout the entire seminar series, he was an important bridge builder between research, business and technology. For many participants, he therefore became more than a professional leader – he also became a mentor who inspired new thinking about innovation, digitalization and commercialization.
Read more about Peder Inge Furseth here
From studies and seminars to today's professional universe
The studies, seminars and field trips documented on this page are part of the knowledge base behind The Invisible Capital. Topics such as customers, technology, innovation, digitalization and value creation have followed developments over several decades – but the disciplines have also continued to develop.
At The Invisible Capital, we are therefore continuing to work on these questions in our own subject series. Here, we connect previous theory, research and experiences with newer knowledge, new technologies and today's challenges for people and businesses.
Innovation
Innovation is not just about new ideas. Value is created when knowledge, technology and ideas are developed into products, services, processes, organizational forms and business models that are actually used. The series on innovation goes from Schumpeter to modern innovation research and covers, among other things, incremental, radical, disruptive, open and user-driven innovation.
→ Explore the Innovation Series
The customer
The customer is not just the recipient of what the business produces. In a competitive market, the customer is a crucial determinant of whether the business actually succeeds in creating value. The series about the customer goes deeper into customer orientation, customer insight, customer experience, satisfaction, loyalty, trust and the encounter between people.
→ Read the customer series
Value creation
What does it really mean to create value – and who creates it? The series on value creation moves from economic theory and key researchers to a broader understanding of how people, expertise, institutions, businesses and the public sector contribute to value creation.
→ Read the series on value creation
Digitization
Digitalization has evolved from stand-alone technologies to a fundamental part of how businesses work and create value. The Digitalization from A–Z series follows the development through internet, web, e-commerce, search, UX, social, mobile, omnichannel, cloud, data, platforms and digital transformation – up to today’s AI First development.
→ Read the series Digitization from A–Z
Artificial intelligence
Artificial intelligence represents the next chapter in digital evolution. In our own AI universe, we investigate how artificial intelligence works, how AI finds and uses information, how it evaluates sources and websites, and what the development can mean for people, businesses, and value creation.
→ Go to the articles about artificial intelligence
Recommended literature
Internet Marketing and e-Commerce
A seminal book from the early eMarketing era written by Ward Hanson and Kirthi Kalyanam , the book shows how the Internet began to transform marketing, CRM, and digital commerce through new digital business models and customer journeys.
