Company: BroadVisionCustomer: RS ComponentsSubmitted by: Kinross and RenderDate: 1999On a long cross-Atlantic flight from the US to the UK, the two-man team chosen to push the frontiers of digital distribution for RS Components, David Sones and Bernard Hewitt, finally found a chance to decompress. After months of exhaustive research and countless miles logged to numerous countries, their search was winding to an end. Thirty thousand feet above the North Atlantic Ocean, a glimpse of the future began to unfold.
BUILDING A VISION
For Sones and Hewitt, the future for RS Components held the promise of an online mega-store with a personal connection to each customer. As they saw it, the company’s online presence would possess the ability to identify and interact with customers, both new and old, as if the company knew them personally. Customers would shop at their convenience for products relevant to their specific needs and be introduced to other similar or associative products to avoid the hassles of sifting through 111,000 products. Throughout the process, RS Components would be learning and refining the process to serve each customer with enhanced personalization. It was an elegantly simple plan.
Throughout the flight, the team went to work on a visual representation of the concept to deliver to the RS Components’ advisory committee. “We could have generated a 50-page written report,” Sones states. “But the image really captured people’s attention. We went on to explain the concept in more detail.Afterwards, the CEO came to us and said, go find the technology and the business partners to achieve this.
” One question remained—could they cobble together available technology to turn their one-to-one, personalized vision into a working reality?
YOU SELL THAT?
At RS Components, the founding premise is simple—”A replacement part for every job”. A seemingly elementary mission for a company that stocks over 111,000 products, distributes to over 160 countries worldwide and supports over 1,000,000 engineers. But matching the right product to the right person for the right job? That is no easy task.Three times a year for the past fifty years, RS Components has published a catalog displaying the latest in electrical and industrial tools and products. As the quantity of product offerings grew, so too grew the catalog.
Today, the RS Components catalog, comprised of six separate volumes, weighs over eleven pounds (5 kgs.). “Accessing what you wanted in that catalog had become a bit of a problem,” conceded David Sones, Head of Technical Development at RS Components. “Our research concluded that customers became familiar with particular sections of the catalog, but rarely went beyond them in search of other RS products.”Company research also demonstrated that customers were unaware of many products offered by RS and thus purchased items from competing vendors.”We would ask them, why don’t you buy that from us? And they would say, I didn’t know you sold that,” states Sones.
“Ultimately they would also confess that they just didn’t have the time to sift through a massive catalog to find everything they needed.”
THE DIGITAL JUMP START
So in 1995, RS Components developed a CD-ROM to offer customers an alternative to the imposing printed volume. The CD-ROM was an instant success. “We had a bit of a jump-start as all of the assets for the catalog were digital,” states Sones.
“We were able to simply reformat our catalogue database to create the CD-ROM. Sones concedes that the printed catalog is still the principal distribution method for RS Components but the CD-ROM opened an additional channel.The CD-ROM also offered additional insights into customer purchasing behavior. RS Components now knew customers were prepared to use PC technology to overcome the barriers presented by the printed book. “We are not trying to force customers to switch channels. Our strategy is very much one of education and encouragement,” states Sones.
“In the long term however, we will realize some enormous cost savings shifting from the physical over to the digital.”
THE POWER OF TEAMWORK – BROADVISION, CTP AND RS COMPONENTS
Empowered by their vision and executive backing, Sones and Hewitt set out to find the right technology solution partner. In the summer of 1997, RS linked up with BroadVision and the Interactive Solutions division of Cambridge Technology Partners. “We were immediately impressed by both companies “can-do” attitude,” recalls Sones. “We presented the original concept to them and then jointly hammered on it for five weeks.
“Over time, the vision was transformed into executable site elements. Each element was evaluated in terms of its complexity and business benefit. “This was actually our first BroadVision implementation in the UK,” recalls Matthew Cohan, Director of the Interactive Solutions Division at Cambridge Technology Partners. “We have since gone on to do many more BroadVision site developments but this has a real learning experience for everyone.”After the five-week design workshop where all of the business requirements were defined, the BroadVision One-To-One Application was removed from the box.
“We knew we would need powerful front-end interfaces to build the presentation layer we had envisioned,” says Sones. “BroadVision was clearly the strongest product in this area.”For three days and nights, the team built a working prototype, which was presented to the advisory group. Sones recalls, “When we showed them the RS Components business on the Web with full, personalized functionality, they were blown away. “
KEEPING THE PROMISE
Since 1937, RS Components has proudly delivered superior service to an enormous customer base. This is quite a feat for a company that in the UK alone receives over 17,000 telephone calls, processes over 17,000 orders and delivers approximately 25,000 parcels per day.
In fact, every 10 seconds, an engineer somewhere in the world orders from RS Components.The initial RS Components site was launched to the UK market in February 1998. “We have built incredibly high service levels in our channels,” says Sones. Of the over 111,000 products currently offered, RS maintains stock availability of over 99.5%.
If an order is placed prior to 8pm, it is delivered the next day. Any order placed on the Web site might lead to a drop in customer satisfaction if not delivered within the expected service levels.”We’re a marketing brand leader. We couldn’t afford to damage that. There was too much at stake,” says Sones.
“We had no idea of what to expect when we went live. So we launched in a market we understood. Once we’ve fully mastered BroadVision’s powerful campaign, profiling and targeting tools, and the way customers behave in this new channel, we’ll start to roll it out geographically.”
A SITE TO BE SEEN
Much more than just an online catalog, the RS Components site takes advantage of BroadVision’s profiling and observation techniques, adding a personal touch to business relationship management.”In just seven months, Cambridge Technology Partners and BroadVision helped RS Components create the type of personalized, scalable online service that Cisco, Dell and Amazon.com dream of,” Sones states proudly.The new RS Components online commerce channel powered by BroadVision One-To-One is a world class, award winning implementation and a milestone in UK business-to-business e-commerce market.
The Web site provides a personalized interface that makes it easy and convenient for customers to evaluate and order over 111,000 products online.Customers can browse through products in the same way they would browse through the conventional catalogue, or use a powerful search engine that enables them to find specific products quickly. Unlike the printed catalog and CD-ROM, which had to be followed up by telephone or fax ordering, products can be searched using any number of different criteria such as descriptions, product codes or manufacturers’ names, and purchased immediately on the site.The Web site differentiates between account and cash customers according to their registration on the site and automatically assigns correct prices for orders and payment. Cash orders can be accepted by credit card and processed in the same way as telephone orders. The Web site is fully integrated into RS Components’ IBM ES/9000 based ‘Customer Order Processing System’ (COP).
BroadVision One-To-One Command Center empowers marketing and business managers to change the rules, which govern individual interactions or any promotional aspects of the site as often as they choose, without additional programming. Product groups can also be cross-promoted thus maximizing the value of each order.
For example, technical books, a popular item for engineers, can be added to a particular product order.”We are also beginning to see some incremental customers starting to arrive on the site,” Sones points out. “New customers we have never seen before are coming on and using credit cards. There are a lot of people out there—small businesses, hobbyists and individuals—that knew about us but did not shop with us before.”
TIME + SPEED = MONEY
RS Components adds over 5000 products to its inventory every four months. The process time—identifying new products, receiving and evaluating samples, photography, copy writing and technical specifications— to actually turn a product into a potential revenue stream can require upwards of twelve months.
“The Web offers us the opportunity to do some dynamic publishing,” Sones comments. “Once identified, you could push it through in 48 hours. So it is not the technology that slows you down, it’s the processes. We are working on the whole end-to-end production so that we can speed that up enormously via BroadVision.”