Unified commerce is often seen as the next step in modern retail. What is it and what does it take to make it happen? Chris Seelig, Senior Business Consultant at CGI, and Albert Visser, Implementation Manager at New Black, a unified commerce solution provider, explore the what, how and why of delivering a unified commerce strategy.
What is unified commerce?
“Unified commerce centers around one platform through which you can service all your customers, creating better experiences across your apps, social media, stores and more. The power of such platforms is in the customer context they store at each datapoint,” explain Chris. Albert adds: “In a typical retail landscape information about orders is, for example, separated from the data about the customers who placed them. By combining all this data on a single platform, you get a tremendous amount of context. You can use this context, as Chris mentioned, to improve the buying experience and also to speed up internal processes. It makes the flywheel spin much faster.”
“The power of such [unified commerce] platforms
is in the customer context they store at each data point.”
How is unified commerce different from the more common omni-channel strategies?
Serving customers across all channels is not new. Strategies like multi-channel and omni-channel have been around in retail for a while. What is the difference between these strategies and unified commerce? “In the eyes of the consumer there is no difference. Both are about being able to, for example, walk into a store with items you bought online, and return them on the spot. It is what’s happening behind the scenes that is radically different,” explains Chris.
This difference is primarily in the design of the IT landscape. The rise of e-commerce resulted in the introduction of new siloed systems that are not designed to connect with in-store systems. As a result, retailers with omni-channel ambitions are forced to tie together systems that often are not designed for connectivity, which is reflected in poor API connectivity or the use of dated forms of file exchanges.
What has led to the rise of unified commerce as a concept?
This focus on connecting systems created “best-of-breed” IT landscapes that many of today’s retailers have in place. “Over time, retailers collected a lot of nice, but niche partners around them that excel in one part of the puzzle. The real problem is connecting all these systems across the departments of your organization. After a few years of connecting systems, many retailers needed a large IT team just to keep the machine working,” explains Albert.
These interconnected systems make it difficult for retailers to innovate, as changing one part of their IT landscape might disrupt a process somewhere else. “Modern customers, with their “on-demand” mindset for buying and receiving items, do not care about operational struggles behind the scenes. All they care about is being served,” states Chris. As a result, it’s often the IT department of an organization that drives unified commerce approaches. The reason is simple—for retailers, IT capacity has long been an innovation bottleneck. With a unified commerce platform in place, the IT team can now say: “Sure, we can introduce this new service within a month.”
These interconnected systems make it difficult for retailers to innovate,
as changing one part of their IT landscape might disrupt a process somewhere else.
Has the COVID-19 pandemic changed these dynamics?
“The one thing COVID-19 made clear is that many retailers don’t have a connection with customers who normally visits their stores. Where are they now? The pandemic really shed light on the need for retailers to improve the onboarding of store customers,” Chris explains. Albert says he does not believe COVID-19 in itself had much of an impact on unified commerce. In his view, it served more as an example of a sudden change that revealed which retailers can adapt quickly and which are held back by their IT. “We had clients that suddenly faced overloaded e-commerce warehouses, causing delays. As they have the full context of orders and stock available instantly, they could just switch to shipping from their stores. This totally changes the role of stores. The pandemic really is a test for brands. Are you capable of changing on the spot?”
“The pandemic really is a test for brands.
Are you capable of changing on the spot?”
How to succeed with a unified commerce strategy?
Unified commerce is as much about organizational change as it is about technology. “When you start implementing a unified commerce platform, you are naturally forced to break down the silos in your organization. It needs multidisciplinary teams that include people from finance, logistics, the supply chain, e-commerce, marketing and more. You can move extremely fast as an organization by adopting this new mentality,” says Chris.
How do I know if unified commerce is a strategy for me?
Chris and Albert both agree that any retailer who is active online, offline and on social media can benefit from and create value by simplifying their IT landscape. Albert cautions that an organization must have a natural willingness to change its DNA. “We’re merely at the beginning of this trend as channels keep expanding,” adds Chris. When you sell through marketplaces, you might want to be able to serve customers coming directly to your stores with a return. By having all customer data in one place you can start thinking about offering such services.”
What do I need to do to make this a success?
According to Chris, it all begins with a deep obsession to serve the customer in the very best way possible. “This obsession must start at the very top of the organization and should trickle down. Without this, your project will eventually fail.” He also adds that organizations must be willing to rethink their department structures where each silo has its own KPIs. “Basket size, customer satisfaction, revenue—these are KPIs that cannot be siloed. By assessing departments on their own, often conflicting KPI’s, you will never create a true customer-centric mindset.”
Organizations must be willing to rethink their department structures
where each silo has its own KPIs.
Albert adds that it is important to create a solid business case. “Don’t transform for the sake of transforming. Make your case. Keeping a best-of-breed IT landscape afloat means you pay a lot of license and maintenance fees. Compare this to a unified landscape to create a solid business case. This creates the commitment for a transformation before you start.” Chris adds that the business case should also include the revenue uptick that unified commerce can create in terms of conversion rates, basket size and customer lifetime value. “It is as much about increasing revenue, as it is about saving costs,” he adds.
How can I find the right partner(s) to make this happen?
Unified commerce is not about replacing all your vendors with a single solution. It is more about reducing complexity and looking for bundled solutions that address a lot of needs. Chris explains: “In an omni-channel landscape, a retailer has to align all the different partners. In unified commerce, the solutions of many partners are bundled on one platform, greatly reducing this “director” role.”
Unified commerce is not about replacing all your vendors
with a single solution. It is more about reducing complexity
and looking for bundled solutions that address a lot of needs.
According to Albert, this also requires partners to embrace a new mindset. “Many software vendors are niche specialists who sometimes find it difficult to think outside their own box.” To illustrate, Albert compares this strategy to a puzzle, in which every partner plays a role and adds expertise. “Retailers often try to complete the puzzle themselves, only to involve partners once it’s done. Instead, get experts involved and collaborate much earlier, so we can share our experience.”
In conclusion, how would you recommend retailers start their unified commerce strategy?
“Start by truly understanding your customer. How do my customers really want to shop? Do they care about the in-store service or more about fast home delivery?” says Chris. With a razor-sharp vision and strategy focused on serving your customers, you can now start by identifying “unified” processes that you can set-up or improve. Albert suggests starting small by setting up one new process such as “Endless Aisle” or rolling out mobile apps for store employees. “Prove that this adds value or saves costs and your organization will be quick to catch on and move forward.”
The original version of this article was published on the New Black website.
To learn more about how CGI and how together with our ecosystem of partners we can help you implement and benefit from a unified commerce strategy, please contact us at email@example.com
Read more about the benefits of unified commerce in our CGI Client Global Insights blog, “Six ways retail and consumer organizations can accelerate their digital journey.”
About Chris Seelig
With close to 10 years of experience, Chris serves as a Business Consultant in CGI’s retail practice in the Netherlands supporting clients’ digital transformation. His expertise extends across the retail value chain including in-store technology, omni-channel, data and analytics, loyalty and personalization solutions. Chris has a deep understanding of evolving industry trends and challenges and through an agile mindset and approach helps clients transform to meet customer expectations and drive growth.