What Is Unified Commerce?

Nicole Willing

Nicole Willing

November 13
  •  
4 minute read
Unified commerce diagram

Definition

Unified commerce combines sales and data functions seamlessly in a single platform so that retailers can deliver personalized, omnichannel experiences to their shoppers.

 

Overview

Unified commerce is an experience-led approach that brings together the transactional functionality of a retail platform with customer data insights. Retailers today collect data from numerous sources, from websites to mobile apps, loyalty programs, and point-of-sale (POS) terminals. Having a single view of that data allows you to analyze and forecast customer behavior, using that information to enhance the user experience across retail channels.

E-commerce is becoming increasingly diversified across channels, including online stores, marketplaces, and brick-and-mortar stores. That can result in a fragmented user experience in which storefronts carry outdated information about product inventory levels and incomplete customer records.

A unified approach is the next step in omnichannel retail, ensuring that you can combine inventory, customer, and order data to create seamless personalized experiences that increase sales. Research from consulting firm McKinsey shows that 83% of online customers want their shopping experience to be personalized, and effective personalization can increase store revenues by 20-30%.

 

How Unified Commerce Works

A unified commerce strategy is centered on a single software platform delivering real-time connectivity to sync sales through online and offline channels. The platform consolidates operations in a single backend to manage all stores. In this way, a headless architecture enables unified commerce.

Uniting channels on the same platform maintains all commerce information in a single database and distributes it to each consumer touchpoint, or head. 

The commerce platform combines processes including:

  • Product information management
  • Pricing and promotions
  • Order fulfilment
  • Inventory management
  • Customer relationship management
  • Payment processing
  • Point of sale systems
  • Content management systems
  • Enterprise resource planning

By integrating these functions, retailers can offer seamless customer services, including shopping carts shared across channels, click and collect, real-time stock availability, and the ability to return online purchases to a physical store. They can use customer data to create personalized offers, recommendations based on past purchases, and automated order tracking updates. 

Marketing teams can also leverage the data to create tailored inspirational content and promotional campaigns to increase customer engagement.

Unified commerce and omnichannel

Shoppers often use multiple channels to make purchases: for example, researching products on a mobile device before purchasing in store or adding products to a cart on a desktop site and completing checkout on a mobile app. To benefit from the full potential of omnichannel delivery, retailers need to use a unified system. 

Patching together separate systems that may not fully work in sync limits your ability to provide a truly seamless experience. A delay in communication between inventory management and product information systems could result in selling an out-of-stock product on your website or displaying an incorrect price. And systems with separate databases may not be able to recognize returning customers when they use different channels. A unified commerce engine makes true omnichannel delivery possible.

Unified commerce and headless

As mentioned above, headless commerce is the platform architecture that forms the basis of a unified approach. The decoupling of the backend system is what allows retailers to run all storefronts, or heads, from the same commerce engine to provide a unified customer experience. The advantage of a headless architecture is that it operates the individual backend processes as microservices, allowing retailers to gradually replace functionality in legacy platforms over time, rather than having to re-platform overnight.

The application programming interfaces (APIs) that connect the backend with the storefronts call data from the relevant microservices and deliver it in real time, supporting a dynamic customer journey between devices. By connecting microservices, retailers have the flexibility to create new personalized features and respond quickly to changing customer trends. 

 

Example of Unified Commerce

In the past, sports apparel and equipment manufacturer Nike has experienced inventory overhang that cost it millions of dollars. However, the company has unified its commerce platform to improve inventory management and invested in direct-to-consumer sales channels. Nike’s branded stores are fully integrated with its online presence. 

Some of the features this enables include:

  • Sales associates and product displays direct shoppers to nike.com, where they can customize and design products that are only available online. 
  • Shoppers can buy online and collect in store, buy in store for home delivery, and order deliveries to or from another store. 
  • Handheld point of sale (POS) terminals allow sales associates to process purchases anywhere in store, capturing sales right after a shopper has tried on a product and eliminating queues at payment desks.
  • Nike’s concept stores are connected to the Nike+ App, so that shoppers can scan barcodes on mannequins and garments to request products to try on or purchase entire outfits. A self-service instant checkout feature allows them to scan and pay for products with the payment method saved in their account.
  • In-store product displays are stocked based on e-commerce data showing the most popular products.
  • Membership accounts are linked across Nike’s websites, shopping apps, activity apps and stores, providing personalized content and discounts.
  • Engagement with Nike’s training apps drives sales of its apparel and footwear and Nike Experiences promoted in the apps bring users to in-store workshops and events.

Nike’s digital business is contributing 30% of its revenue, nearly three years ahead of schedule, growing 82% in the three months to August 31, 2020 and generating almost $900 million of incremental revenue compared with a year earlier.

 

Key Takeaways

  • Unified commerce is an experience-led approach to retail that uses customer data to give you a complete view of the customer journey and allow you to build a personalized experience.
  • A headless platform architecture enables unified commerce by connecting a single backend to multiple storefronts.
  • Unified commerce ensures omnichannel delivery is seamless for the consumer and offers new interactive features that integrate online functionality into physical stores.
  • Nike is generating growing revenues from its app-integrated concept stores, overcoming inventory management challenges that previously cost it millions of dollars in lost revenue.

Nicole Willing

Nicole Willing

November 13

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