In 2013, at the SAP National Retail Forum (NRF), the results of a Retailer survey concerning Omni-Channel maturity were presented. The findings demonstrated the degree to which Retailers were taking advantage of Omni-Channel opportunities. The results indicated that although 85% of Retailers considered themselves Omni-Channel, only 8% of the same Retailers provided an ability for a customer to transact in multiple Channels, and, even more concerning, only 7% of these Retailers indicated that they had a single view of the customer across their channel offerings. This issue remains important for Retailers today. In fact, Forbes lists the ‘(Creation of) New Revenue Streams’, including ‘data-as-a-product offering’ to be the #1 strategic issue facing CIO’s for 2016.
Retailers today are keen to capture as much information about the customers shopping their various platforms. However, according to the survey commissioned by SAP, the vast majority subscribe to a ‘Multi-Customer’ collection model. Customer data sets are often found to be independent of each other; Loyalty, eCommerce, POS transactions, Private Label Credit Card, etc., each have distinct data sets that result in both customer overlaps and customer gaps. A customer may have not shopped on a Retailers website, but is a loyalty member and holds a Private Label Credit Card. This single customer’s information could reside as data points within various databases and each of these customer records could, and likely will, contain differing information that is invisible to other Channels.
Data-as-a-product can be defined as ‘the use of a Retailers comprehensive data set as inputs into descriptive and predictive analytical processes’. Consolidating, simplifying and enriching this data set aids in building a strong and personalized customer relationship with your organization and moves you beyond the simple reporting paradigm to which most retailers continue to subscribe. During our recent webinar regarding the functional/technical response to this challenge through the utilization of the SAP Campaign Management suite of tools, the concept of the Omni-Customer was briefly discussed. Although not the focus of the session, it is an approach to customer records management that must be considered during Business Transformations, Capability Road-Mapping and IT Architecture Governance. This Omni-Customer approach is required to enable a strong “data as a product” response and will help to address many of the Top 10 strategic challenges identified in the Forbes article quoted above.
SAP provides a suite of tools and integration points to fully enable an Omni-Customer framework, allowing you to best meet the demands of today’s customer. Diagram #1 illustrates a reference architecture containing both relevant SAP applications and integration to external systems. For the purpose of this article I have chosen to utilize the SAP offerings for the ERP System as well as SAP offerings for the Customer Channels. Additionally, I have chosen to indicate integration with an external Supply Chain System and an external Marketing Content Production service provider. The overall integration model does allow for integration to external systems beyond what is illustrated here.
Diagram #1: SAP Reference Architecture
/N SPRO has successfully implemented versions of this architecture in a number of North American Retailers, fully tailored to their business requirements and existing system landscape. Depending on the scope of the particular implementations, these clients of are realizing the benefits of considering their data as a product – data that is managed in a single framework and is consumed by multiple application layers. The benefits can be stated as follows and can be referenced by number in the diagram above:
- SAP CRM: 360o Customer Master Record
- Transparent Marketing Planning & Offer Consistency
- Holistic Budget Management
- Optimized Inventory Support
- Superior Customer Experience
The next set of blog entries will discuss each of these subjects in detail. Integration considerations will be provided, business benefits will be discussed, and recommendations on how to quantify your IT spend in terms of return on investment will be provided.