San Francisco Seminar 2006
Day 4
Multi-Channel Strategy and the Renaissance of the Web
Introduction and Context
The second-to-last 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 had become the competitive arena itself, and that data was at the heart of growth, loyalty, and efficiency. In 2006, many companies were still standing at the threshold between physical stores and digital channels.
Day 4 showed how the world’s most forward-thinking companies were already taking an integrated approach: Customers want to move seamlessly across 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
Key Topics
IBM – Multi-Channel Retailing Solutions
Craig Stevenson presented IBM’s extensive study of 450 senior executives worldwide. It revealed two key priorities in 2006—growth and cost control—while customers were becoming more informed, impatient, and less loyal.
“Customer experience is the new battleground.”
Key Points:
Friction is costly: 50% of multi-channel customers switch providers when the experience is disconnected.
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The web is not an add-on: E-commerce must be integrated into the business strategy, not managed as a separate project.
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Seamlessness builds loyalty: One customer view, one product inventory, one experience—regardless of channel.
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IBM highlighted three common barriers in the retail sector:
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Fragmented order and inventory management (53%).
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Lack of customer data sharing (50%).
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Budget and incentive structures that favor individual 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 the store.
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Next Gen Contact Centre – from support function to sales channel.
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 sales surpassed 10% of total U.S. retail sales.
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Online retailers reported margins of ~28%, compared with 6% for brick-and-mortar retailers.
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Drivers of Profitability:
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Significant 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.
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Customer Satisfaction:
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According to the American Customer Satisfaction Index (2005), e-commerce scored higher than physical retail—Amazon received a score of 88/100. Price, experience, and product selection were the most important factors. (See also examples of measurement through ForeSee Results at Navico.)
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“The Long Tail” Effect:
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The web removed the limitations of physical shelf space—niche products could generate significant combined volume and margins.
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More choices, broader selections, and personalized recommendations = increased customer value.
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Shopping Cycle 2.0:
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Find products (search engines, filtering, guided navigation)
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Evaluate (reviews, 3D views, comparisons)
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Purchase (wish lists, one-click checkout, flexible delivery options)
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Delivery and follow-up (tracking and notification systems)
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Returns (omnichannel and frictionless)
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Future Competitive Advantages (as seen in 2006):
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Visualization – images, zoom, and virtual models.
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Personalization – data-driven product recommendations.
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Contextual experience – tailored to the user’s situation.
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Case Studies
Kalyanam presented data from Shop.org and Santa Clara University showing that lower technology costs and higher customer satisfaction were key to the success of e-commerce.
The IBM case studies demonstrated how integrated systems and customer data created competitive advantage and increased margins.
Reflections and Discussion:
Day 4 challenged participants to view e-commerce and physical retail as two sides of the same value chain.
Digitalization was no longer about technology—it was about customer understanding, data flows, and business logic. The discussions focused on how Nordic companies could break down silos, build PIM systems, and invest in personalization, while U.S. companies were already several years ahead.
International Perspectives
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United States: Clear integration of channels and a focus on experience-driven retail.
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Norway: Web projects were still treated as “add-ons”—without strategic integration.
This difference became an important lesson:
Digital maturity is not about technology, but about culture and leadership.
What We Took Home With Us
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Multi-channel is not an option—it is a survival strategy.
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Seamlessness and data quality create loyalty and improve margins.
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Customers expect personalized, accessible, and frictionless experiences.
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Organizations must measure value creation across channels, not within individual channels.
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 reality.
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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 forces behind personalization at scale.
Day 4 in San Francisco in 2006 was therefore a glimpse into the future:
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Those who succeed in combining technology, data, and empathy will win customer trust and shape the future of the market.
Peder Inge Furseth
Peder Inge Furseth was a key academic driving force behind the San Francisco seminars and played an important role in making the encounter with Silicon Valley relevant to Norwegian and European organizations. Through his role as a professor at BI Norwegian Business School and as academic director of the program, he helped participants place the presentations within a broader context—one in which technology, innovation, business development, and people had to be understood together.
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 with practical challenges and opportunities facing Norwegian organizations. He helped translate Silicon Valley’s ideas and ways of working into a
Nordic context where collaboration, trust, and long-term value creation play a central role.
Throughout the seminar series, he served as an important bridge between research, business, and technology. For many participants, he therefore became more than an academic leader—he was also a mentor who inspired them to think differently about innovation, digitalization, and commercialization.
Learn more about Peder Inge Furseth here
From Studies and Seminars to Today’s Knowledge Hub
The studies, seminars, and academic trips documented on this page form part of the knowledge base behind The Invisible Capital. Topics such as customers, technology, innovation, digitalization, and value creation have been part of this journey for several decades — while these fields have continued to evolve.
At The Invisible Capital, we continue exploring these questions through dedicated knowledge series. Here, earlier theory, research, and experience are connected with newer knowledge, emerging technologies, and today’s challenges facing people and organizations.
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 put into use. The series on innovation traces the field from Schumpeter to modern innovation research and explores incremental, radical, disruptive, open, and user-driven innovation.
→ Explore the Innovation series
The Customer
The customer is not simply the recipient of what an organization produces. In a competitive market, the customer is a decisive factor in whether an organization actually succeeds in creating value. The series on the customer explores customer orientation, customer insight, customer experience, satisfaction, loyalty, trust, and the human interactions that shape the customer relationship.
→ Explore the Customer series
Value Creation
What does it really mean to create value — and who creates it? The Value Creation series moves from economic theory and influential thinkers to a broader understanding of how people, knowledge and skills, institutions, organizations, and the public sector contribute to value creation.
→ Explore the Value Creation series
Digitalization
Digitalization has evolved from individual technologies into a fundamental part of how organizations operate and create value. The Digitalization from A to Z series traces this evolution through the internet, the web, e-commerce, search, UX, social media, mobile, omnichannel, cloud, data, platforms, and digital transformation — leading up to today’s AI-first era.
→ Explore the Digitalization from A to Z series
Artificial Intelligence
Artificial intelligence represents the next chapter in the digital evolution. In our dedicated AI knowledge hub, we explore how artificial intelligence works, how AI finds and uses information, how it evaluates sources and websites, and what this development could mean for people, organizations, and value creation.
→ Explore the articles on Artificial Intelligence
Recommended Reading
Internet Marketing and e-Commerce
A key 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.
