Santiago Gallino

Santiago Gallino
  • Charles W. Evans Distinguished Faculty Scholar
  • Associate Professor of Operations, Information and Decisions

Contact Information

  • office Address:

    3730 Walnut Street
    547 Jon M. Huntsman Hall
    Philadelphia, PA 19104

Research Interests: Empirical Operations Management, Retail Management

Links: CV

Overview

Santiago Gallino is The Charles W. Evans Distinguished Faculty Scholar, Assistant Professor at the OID Departament.

He is a scholar of operations management (OM) with a particular interest in digital transformation and strategy execution. In regards to applications, Prof. Gallino is passionate about OM challenges in the retail industry. He studies both omni-channel integration and store execution issues in retail. In his research, Prof. Gallino uses field data and econometric tools to study existing operational practices as well as potential operational improvements.

Before joining Wharton, Prof. Gallino worked at the Tuck School of Business at Dartmouth.

Prof. Gallino holds a PhD in Operations and Information Management and a Master’s in Statistics from the University of Pennsylvania where he was a Fulbright Scholar, an MBA from IAE Business School, and a degree in Electrical Engineering from Universidad de Buenos Aires.

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Research

  • David Bell, Santiago Gallino, Antonio (Toni) Moreno-Garcia (2020), Customer Supercharging in Experience-Centric Channels, Management Science.

    Abstract: We conjecture that for online retailers, experience-centric offline store formats do not simply expand market coverage, but rather, serve to significantly amplify future positive customer behaviors, both online and offline. We term this phenomenon “supercharging” and test our thesis using data from a digital-first men’s apparel retailer and a pioneer of the so-called “Zero Inventory Store” (ZIS) format—a small footprint, experience- centric retail location which carries no inventory for immediate fulfillment, but fulfils orders via e-commerce. Using a risk-set matching approach, we calibrate our estimates on customers who are “treated”, i.e., have a ZIS experience, and matched with identical customers who shop online only. We find that post the ZIS experience, customers spend more, shop at a higher velocity, and are less likely to return items. The positive impact on returns is doubly virtuous as it is more pronounced for more tactile, higher-priced items, thus mitigating a key pain point of online retail. Furthermore, the ZIS shopping experience aids product discovery and brand attachment, causing sales to become more diffuse over a larger number of categories. Finally, we demonstrate that our results are robust to self-selection and potentially confounding effects of unobservable factors on the matched pairs of customers. Implications for retailing practice, including for legacy, offline-first retailers, are discussed.

  • Carolyn Deller and Santiago Gallino (Working) Pay for Quantity or Time? Implications for Work Speed and Quality.

  • Dawson Kaaua, Santiago Gallino, Christian Terwiesch, S Mehta (Working), The Impact of Waiting Location on Customer Satisfaction: An Empirical Analysis of Preoperative Patient Flow.

  • Santiago Gallino and Dawson Kaaua (Work In Progress), How May I Help You? Inferring Service Quality from a Server’s Personal Details.

  • Marshall L. Fisher, Santiago Gallino, Jiaqi (Joseph) Xu (2019), The Value of Rapid Delivery in Omnichannel Retailing, Journal of Marketing Research.

    Abstract: The authors study how faster delivery in the online channel affects sales within and across channels in omnichannel retailing. The authors leverage a quasi-experiment involving the opening of a new distribution center by a U.S. apparel retailer, which resulted in unannounced faster deliveries to western states through its online channel. Using a difference-in-differences approach, the authors show that online store sales increased on average by 1.45% per business day reduction in delivery time, from a baseline of seven business days. The authors also find a positive spillover effect to the retailer’s offline stores. These effects increase gradually in the short to medium term as the result of higher order count. The authors identify two main drivers of the observed effect: customer learning through service interactions with the retailer, and existing brand presence in terms of online store penetration rate and offline store presence. Customers with less online store experience are more responsive to faster deliveries in the short term, while experienced online store customers are more responsive in the long term.

  • Santiago Gallino and Antonio Moreno-Garcia (Eds.), Operations in an Omnichannel World (Springer, 2019)

    Abstract: The world of retailing has changed dramatically in the past decade. Sales originating at online channels have been steadily increasing, and even for sales transacted at brick-and-mortar channels, a much larger fraction of sales is affected by online channels in different touch points during the customer journey. Shopper behavior and expectations have been evolving along with the growth of digital channels, challenging retailers to redesign their fulfillment and execution processes, to better serve their customers. This edited book examines the challenges and opportunities arising from the shift towards omni- channel retail. We examine these issues through the lenses of operations management, emphasizing the supply chain transformations associated with fulfilling an omni-channel demand. The book is divided into three parts. In the first part, “Omni-channel business models”, we present four studies that explore how retailers are adjusting their fundamental business models to the new omni-channel landscape. The second part, “Data-driven decisions in an omni-channel world”, includes five chapters that study the evolving data opportunities enabled by omni-channel retail and present specific examples of data-driven analyses. Finally, in the third part, “Case studies in Omni-channel retailing”, we include four studies that provide a deep dive into how specific industries, companies and markets are navigating the omni-channel world. Ultimately, this book introduces the reader to the fundamentals of operations in an omni-channel context and highlights the different innovative research ideas on the topic using a variety of methodologies.

  • Santiago Gallino, Nil Karacaoglu, Antonio Moreno-Garcia, “Whether Weather Matters: Impact of Exogenous Factors on Customers Channel Choice”. In, edited by, (2019)

  • Bob Batt and Santiago Gallino (2019), Finding a Needle in a Haystack: The Effects of Searching and Learning on Pick-worker Performance, Management Science.

    Abstract: The rise in online and multichannel retailing has pushed retailers to give increased attention to their order fulfillment operations. We study "chaotic storage" fulfillment systems in which dissimilar items are stored together in a single location. This necessitates a searching task as part of the picking process, which has not been previously studied. We show that pick times increase by as much as 16% as the searching task becomes more difficult. However, the deleterious effect of searching decreases with pick worker experience. Using simulation, we show that pick times can be improved by incorporating distance, bin density, and picker experience into pick assignments and pick routing. Through properly combining the details of the task and the workers, order fulfillment productivity can be increased by approximately 5%.

  • Santiago Gallino, Nil Karacaoglu, Antonio (Toni) Moreno-Garcia (Under Review), Why Retailers Should Care about Net Neutrality: The Impact of Website Performance on Online Retail.

    Abstract: The share of e-commerce sales is rapidly increasing and so are the associated losses generated by website outages and slow websites. We leverage novel retail and website performance data to investigate the impact of website performance on online sales. This question is especially relevant in the current regulatory environment, given the ongoing policy debates around net-neutrality. Using two different research designs---panel data with fixed effects and generalized synthetic control with elastic net---we estimate sizable adverse effects of website speed slowdowns on online sales, especially in the mobile channel. Our results show that decreases in website performance make customers less likely to place an order and undermine retailers' quest to turn website traffic into sales. The findings have important implications for the net neutrality debate and retailers' website design decisions, specifically the selection of third-party content providers and the customized design of mobile and desktop channels.

  • Gérard Cachon, Santiago Gallino, Jiaqi (Joseph) Xu, Free Shipping Is Not Free: A Data-Driven Model to Design Free-Shipping Threshold Policies.

    Abstract: Online retailers often offer free shipping threshold policies: customers who purchase more than a threshold amount are not charged an additional fee for shipping. This paper provides a data-driven analytical model to (i) assess the profitability of a retailer’s current shipping threshold policy and (ii) identify the best freeshipping threshold policy for a retailer. The model is estimated from actual transaction and product return data. The model explicitly accounts for changes in customer shopping behavior due to a free shipping threshold, including strategically adding items to a shopping basket to receive free shipping, which we call orderpadding, and the subsequent adjustment in product return decisions. Roughly speaking, according to our model, a retailer that offers a free shipping threshold policy should set the threshold slightly abovethe average shopping basket amount. We calibrate our model to data from an online apparel retailer and determine that its decision to offer a lower free shipping threshold reduced its profitability considerably.This result is robust to a number of assumptions regarding the impact on long-run sales and possible price adjustments. We conclude that free shipping threshold policies are profitable only under a limited set of restrictive conditions.

Teaching

OIDD101 – INTRODUCTION TO OIDD

OIDD 101 explores a variety of common quantitative modeling problems that arise frequently in business settings, and discusses how they can be formally modeled and solved with a combination of business insight and computer-based tools. The key topics covered include capacity management, service operations, inventory control, structured decision making, constrained optimization and simulation. This course teaches how to model complex business situations and how to master tools to improve business performance. The goal is to provide a set of foundational skills useful for future coursework atWharton as well as providing an overview of problems and techniques that characterize disciplines that comprise Operations and Information Management.

Past Courses

  • OIDD101 - INTRODUCTION TO OIDD

    OIDD 101 explores a variety of common quantitative modeling problems that arise frequently in business settings, and discusses how they can be formally modeled and solved with a combination of business insight and computer-based tools. The key topics covered include capacity management, service operations, inventory control, structured decision making, constrained optimization and simulation. This course teaches how to model complex business situations and how to master tools to improve business performance. The goal is to provide a set of foundational skills useful for future coursework atWharton as well as providing an overview of problems and techniques that characterize disciplines that comprise Operations and Information Management.

In the News

Knowledge @ Wharton

Activity

Latest Research

David Bell, Santiago Gallino, Antonio (Toni) Moreno-Garcia (2020), Customer Supercharging in Experience-Centric Channels, Management Science.
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In the News

The Omnichannel Dilemma: How Retailers Can Get It Right

New research from Wharton’s Santiago Gallino and Robert Rooderkerk of Erasmus University offers companies practical advice on how to develop new products that are ready to compete in an omnichannel world.

Knowledge @ Wharton - 12/8/2020
All News