What is Unified Commerce?
We kick off with the evident question; what does ‘Unified Commerce’ mean to you? Chris is quick to summarize: “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 context they store on each datapoint”. Albert adds: “In a typical retail landscape the information on orders is - for example - separated from the full data of the customers who bought them. By combining all this data on a single platform, you get a tremendous amount of context. You can use this context to, as Chris mentioned, improve the buying experience but also to speed up internal processes. It makes the flywheel spin much faster”.
“Using data in all context lets the flywheel spin much faster”
Why is it different from the more common Omnichannel strategies?
Servicing your customers across all channels is not new. Principles like multichannel and omnichannel have long been the talk of the town in retail. So, what’s the difference between these and Unified Commerce? Chris notes: “In the eyes of the consumer there is no difference. Both are about being able to e.g. walk into a store with items you bought online, and returning them on the spot. It’s what’s happening behind the scenes that is radically different”. This difference is mostly seen in the design of the IT landscape. Being able to service customers across all channels has been a retail ambition since e-commerce came into the picture. This same rise of e-commerce caused the introduction of new ‘silo-ed’ systems that were not designed to connect with in-store systems. As a result, retailers with omnichannel ambitions are forced to tie together systems that often are not designed for connectivity, which shows itself in poor API connectivity or old-school file exchanges.
What caused the rise of Unified Commerce as a concept?
This focus on connecting systems created the ‘best-of-breed' IT-landscape that many of today’s retailers have in place. Albert: “Over time, retailers collected a lot of nice, but niche partners around them that really 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 need a large IT team just to keep the machine working”. This overhead of interconnected systems makes it more and more difficult for retailers to innovate, as changing one part of their landscape might topple over a process somewhere else. Meanwhile, as Chris puts it, modern customers, with their ‘on-demand’ mindset for buying and receiving items, do not care about your operational struggles behind the scenes. All they care about is being served. As a result, Unified Commerce is often rising up in organizations through the IT-department. The reason is simple; IT-capacity has long been the bottle neck for launching innovations at retailers. With a Unified Commerce platform in place, the IT-team can suddenly say: “Sure, we can introduce this new service within a month”.
Has COVID-19 changed these dynamics?
“The one thing COVID-19 made clear is that many retailers don’t have a connection to the customer that would normally visit their store. Where are they now? This really shed light on the need for retailers to improve the onboarding of store customers” Chris explains. Albert adds to this that he does not believe COVID-19 itself had much impact on Unified Commerce. In his eyes it is much more an example of a sudden change that shows which retailers can adapt quickly, and which get bogged down by their IT. “We had clients that suddenly faced overloaded e-commerce warehouses, causing delays. Because 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. COVID really is a test for brands; are you capable to change on the spot?”.
Breaking down silos in your organization
Unified Commerce is as much about organizational change as it is about technology. “When you start implementing a Unified Commerce platform you’re 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 go extremely fast as an organization by taking on this new mentality.”
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, benefits from simplifying their landscape. As soon as you have multiple sales channels, it gets interesting and adds value. But Albert warns - your organization must have a natural willingness to change in its DNA. Chris adds that we’re merely at the beginning of this trend as channels keep expanding. “When you sell through marketplaces such as Zalando or Bol.com, you might want to be able to serve customers coming into your stores with a return. They just see the logo on the side of the sneaker. By having all this customer data in one place you can start thinking about such services”.
What do I need to do to make this a success?
As we discovered during our conversation, Unified Commerce is as much about organizational change as it is about technology. According to Chris it all begins with a deep obsession to serve the customer in the very best way. “This obsession starts at the very top of the organization and should trickle down. Without this, your project will eventually fail”. He adds to this that organizations must be willing to break down their original department structure, in which each silo has their own P&L and KPIs. “Basket size, customer satisfaction, revenue – these are KPIs that cannot be siloed. By judging departments on their own, often conflicting, KPI’s you’ll never create a true customer-centric mindset.”
“You shouldn’t worry about in which department your revenue lands, because neither does your customer.”
Adding to this, Albert mentions the need to create a solid business case. “Don’t transform just to transform. Make your case. Keeping a best-of-breed landscape afloat means you pay a lot of license and maintenance fees. Compare this to a Unified Landscape to create a solid business case, that creates the commitment for a transformation before you start”. Chris adds that this business case should also include the revenue uptick 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”.
How to find the right partner(s) to make this happen?
Unified Commerce does not mean you replace all your vendors with a single solution. It is much more about reducing complexity and looking for bundled solutions that cover a lot of needs. Chris explains: “In an omnichannel landscape the retailer has to align all partners. In Unified Commerce the solutions of many partners are bundled on one platform, greatly reducing this ‘director’ role.”
“Unified Commerce is a challenging puzzle. You need people who can play 5-star sudokus”
According to Albert this asks for a new mindset at partners. “Many software vendors are niche specialists, who sometimes find it difficult to think outside their own box”. To illustrate, Albert compares this strategy to puzzling, in which every partner should play a role and add 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”.
To wrap up, how would you encourage retailers to start their Unified Commerce strategy?
Chris: “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?” With a razor-sharp vision and strategy on serving your customers you can now start looking for ‘Unified’ processes that you can set-up or improve. Albert: “Start 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.”