Unified Commerce: Building on A Strong Foundation
To get the ball rolling and tackle this topic, let’s start with the basics. Simply put, Unified Commerce is a way to connect all channels and sources of orders, products, inventory, and fulfilment. We’ll elaborate with some examples.
By looking at it from an order perspective, a standard retailer nowadays can capture orders online, through a call agent, in a brick-and-mortar store, or through resellers. If all these orders were captured in the same system, this would make matters much, much easier. From a product perspective, however, product information is extremely important for your customers. This information can include product specifications, technical datasheets, and high-quality images, to name but a few examples, and should be available across all your channels.
You must be able to guarantee that all this information is consistent in quality and quantity across these channels too. A customer shouldn't have more or better information regarding your products than a reseller. Whether you are working with multiple distribution centers, or rely on a single warehouse for your distribution, correct inventory information on your products is a must. This way you ensure procurement can be optimized, and your customers are always updated correctly on availability.
The origin of Unified Commerce
Since the inception of e-commerce, most businesses have been focused on establishing an online presence. Some companies even started with nothing but an online presence, such as Amazon, Alibaba, and Booking. Others had to set up and run a webshop alongside their traditional retail activities, resulting in a multi-channel approach where each channel is managed separately. In this setup, point-of-sale data is captured and used to increase revenue, and online analytics serve to improve the online shop’s performance. In the early days, this resulted in a lot of unconnected data.
This meant that drawing conclusions from this data could result in improvements for one channel, but at the same time have a negative effect on another channel. Competition between these channels could occur within the same company. To solve this particular problem, businesses tried to connect both systems to bridge the data gap, usually resulting in a subpar solution. Even though you could combine the sales data in this case, the channels would still have separate inventories.
Enter Unified Commerce. Which, instead of connecting systems to tackle one issue, simply replaces all your segmented systems to solve problems you weren't even aware of.
The benefits of Unified Commerce
We have already outlined some of the clear benefits of Unified Commerce, touching on the most obvious ones in the previous paragraph. In the end, it all comes down to improving your customer experience. As a bonus, your internal organization will also reap the rewards from this change. It’s common knowledge by now that customers expect to be served when and where they want. This has become increasingly apparent due to the current situation, with the pandemic forcing a lot of people to stay at home or restructure their workplace. And some of these changes are here to stay.
You can no longer expect customers to come to your store to purchase a product or gather additional information. These options have to be available to them at all times. To enable this, your workforce has to transition to a hybrid approach, combining part-time work from the office with part-time work from home. Keeping an accurate and up-to-date inventory is equally important. Selling an item that is out of stock means you can’t deliver, which will seriously tarnish your customer experience. You will miss out on sales if you have stock you are unaware of, and unnecessarily increase costs by having reserved stock exclusively for your website.
Furthermore, incorrect and inconsistent product information can lead to confusion and even a loss of sales. If a customer visits a store and learns about a certain feature but is then unable to find further confirmation of that feature when reviewing the product online, the confusion this causes can trigger them to look elsewhere for a competing product. Having a centralized system for your product information as the single point of truth across your entire organization helps prevent these situations. The loyalty of your customers should not be left out of the equation in all of this.
If a customer needs service for a product and calls in to schedule a repair, having all essential information at hand can significantly speed up things for your CS staff. Things do break, and the better your company can handle the situation, the more loyal your customers will become. So, in addition to having all your customers’ details at the disposal of your call agent, they should also have a clear view of your servicing engineers’ agendas. We haven't touched on the different communication channels, but these need to be properly integrated as well.
The drawbacks of unified commerce
So, are there only upsides to unified commerce? Unfortunately, not. For starters, it’s an amazing tool for making a flying start with e-commerce... for any organization without legacy systems. However, chances are slim this applies to your situation. This means that a lot of your systems that are already in use need to be updated or replaced to fully reap the benefits of unified commerce.
This can be an expensive exercise with a lot of impact on your organization. Depending on your specific situation, and the level of adjustments needed, this transition can also be very time consuming and require change-management to be successful. Your workforce will be asked to learn how to manage new systems and adopt a different way of working.
Having a single centralized system presents huge benefits, as explained earlier. However, if not executed correctly, you will end up with a SPOF (Single-Point-Of-Failure) setup. You have to take steps to protect your systems from collapsing under pressure or when under attack. We’ll come back to this topic shortly. But don’t let the potential drawbacks and challenges discourage you from moving to a Unified Commerce setup. The world is changing, and your customers expect more. Ignoring this trend will not put you in a position to come out on top.
How to approach your transition to unified commerce
Our preferred approach for transitioning your organization to a Unified Commerce setup is by working from the back to the front. As with building a house, you only focus on painting the walls after having sorted the foundation, structural work, and plumbing. The key systems should be in place and fully integrated. In regard to Unified Commerce, the primary focus should be on the following systems: ERP, CRM, and PIM.
Without these three systems in place, it will be a lot tougher to reach your end goal. Since most organizations already have multiple systems up and running that need to be replaced, we usually recommend using the strangler approach. This approach gradually sets up the new system around the edges of the old system, letting it grow by gradually activating new features over a certain period of time until the old system is completely strangled. This process is repeated until all key systems are in place, at which point you can slowly make your way to the front of the system.
The role of SAP in setting up Unified Commerce
SAP can supply the following systems to support your Unified Commerce setup; SAP S/4 handles your ERP, SAP C/4 focuses on your CRM, and lastly we have SAP PCM for your PIM needs. These systems were all built with integration in mind, and obviously work extremely well together. So, should you already have one or more of these systems in place, that simply means less strangling for your organization in order to make the transition.
SAP Commerce provides multiple options for deploying its systems and can be completely integrated into your ecosystem. SAP Commerce can even serve as an integrator for other systems, as it provides a wide array of APIs they can consume. To limit the dangers of working from a SPOF (Single Point Of Failure), all these systems can be hosted in the SAP Cloud. Relying on SAP’s experience to keep your systems protected and running grants you more time to focus on your business.
But we are a B2B (or B2C) organization
The main difference between B2B and B2C is who your customers are. In a B2B environment, pricing is generally based on volume and can differ for every customer and partner. When it comes to B2C, consumers generally all enjoy the same price. Managing a B2C customer is also a somewhat different affair. Traditionally, B2C tends to focus on a more generic response to common questions, whereas B2B prefers a more personal approach. Luckily, SAP systems are configured to cater to both the B2C and B2B world. Several reference cases are available to further illustrate how SAP can drive value. Feel free to reach out to us for more information.