The Complete Guide to Ecommerce ERP Integration
Successfully integrating ecommerce and enterprise resource planning (ERP) requires both short-term action and long-term planning. Your company can use the data from this integration to develop a streamlined sales environment and a better customer experience, plus find ways to operate more efficiently and profitably.
Setting up an ERP ecommerce integration can give your company serious insights into how to generate additional revenue and boost profit margins by making better decisions about how you utilize your resources.
Integrating ERP and ecommerce can even be vital to the survival of a business. This was the case with Dressbarn, which needed its integration to transform from a failing brick-and-mortar business to a fully online one in 2020.
Dressbarn already had a growing ecommerce business, but it found that its failing physical stores were overwhelming the success of the online business. The company made the call to abandon its retail stores and move completely online.
To be able to do this successfully and with as little interruption to its customers as possible, the company set an aggressive timeline of eight weeks for the transition. Dressbarn knew that its customers had seen closing signs at the stores and read news stories about the closing. It needed to quickly reconfigure the brand as online-only before customers began shopping elsewhere.
Dressbarn used Shopify to take advantage of its significant collection of customer data from its retail locations. It was able to market directly to these customers, showing them that the brand was still alive and well online.
Next, Dressbarn used its ecommerce ERP integration to reset its SKUs, as it no longer had the challenges of maintaining in-store inventory. Shopify’s platform greatly simplified this process, allowing the team to move forward with a limited SKU count initially. It then added SKUs steadily throughout 2020 until the entire catalog was available online.
Through the email and social media marketing tools in Shopify, Dressbarn was able to leverage its customer data to keep customers engaged with the brand. These campaigns helped customers feel comfortable about transitioning away from visiting an actual Dressbarn store like they had in the past.
Dressbarn was able to use Shopify to make immediate changes that benefited its transition. Additionally, now uses Shopify as part of its ecommerce ERP integration to set up and execute its long-term business plans.
Quick Tips to Improve Ecommerce ERP Integration Today
Improving Your Website’s Design
One of the quickest ways you can see improvement in your ecommerce results is through a site redesign. A visitor to your online store who struggles to find their desired product is eventually going to jump to your competitors’ stores. When your site has excellent organization, visitors can find what they need quickly, leading to a pleasant shopping experience that helps you develop return customers. You can use the ERP data you are integrating to help with this site organization.
With Shopify, you receive access to dozens of website development themes that help you display and organize your products in a manner that makes sense. Shopify can help you display related products alongside the product the visitor wants to purchase, potentially convincing the visitor to add more products to the shopping cart. The ERP data you are integrating into the Shopify ecommerce platform can help you find these related products.
Additionally, when you use Shopify to create your online store, you can make use of a color and design theme that exists on every page of the website. Having this type of consistency available will convince visitors about the professionalism and trustworthiness of your site.
Improving the Customer Experience
Beyond having a better design in your website to improve the customer experience before the purchase, the ERP ecommerce integration can give your customers a better overall experience post-purchase.
When customers have questions about the status of an order or about order history, they don’t want to have to call your business to learn this information. They want to be able to search for and find this data on their own through the website.
When you integrate your ERP with the ecommerce platform you are using, the two systems can share their tracking data. This should give your customers easier access to the types of information they most commonly are seeking.
Customers also should be able to personalize their experience with your online store, ensuring they can see the exact data they want to see. When you deploy an ecommerce ERP integration, this data will be constantly available and always up to date.
Maintaining Your Inventory
Few things will frustrate your customers more quickly than finding the product they want on your website, only to have it listed as out of stock. After encountering a couple of out-of-stock pages in your online store, chances are high that your would-be customers will move on to one of your competitors and never return to you.
With the inventory tracking capabilities you receive when integrating your ecommerce and ERP packages, you’ll receive real-time information about product availability. Simply having this information available should help you reduce the number of times you are caught off guard with low inventory.
Without an ERP integration with your ecommerce website, you will not receive alerts about low inventory. You also may struggle to receive accurate and up-to-date data about inventory levels without the integration.
Adjusting Pricing in Real Time
When you have data available from the ecommerce ERP integration that shows exactly what you are paying to obtain each of your products, you can quickly adjust your online store’s pricing.
You don’t want a sudden price hike from your supplier to catch you off guard. Should you fail to update your ecommerce website’s prices to reflect the additional cost of acquiring the products, you could leave your profit margin extremely thin, or you could even lose money on some sales.
Along those same lines, if you notice that a competitor recently dropped its price on one of your more popular products, you might have a temptation to quickly drop your price in response. However, once you study the data available in your integration, you may find that such a price drop would leave you with a loss on that product.
You then can make a calculated decision about whether to risk losing a few customers to your competitor (who is almost certainly selling at a loss) or whether to also drop your price and eat the loss to try to protect your customer base.
Benefits of an ERP ecommerce integration
An ERP ecommerce integration offers many benefits to your business. They save you time and money by streamlining the online ordering process and reducing calls to your customer service department. For a B2B company that relies on email or phone orders due to negotiations and custom pricing, integrations can allow you to create self-service portals where customers can place orders on their own. This would be a huge savings in both time and labor. It replaces the largely manual process of creating orders from phone calls or emails with a more automated solution.
The benefits of ERP integration include a reduced need for manual data entry, which also reduces common data entry errors. When companies are small, they often rely on manual processes. These manual processes are fine when you start out, but they don’t work so well as your order and transaction volume grows. Eventually, an overreliance on manual processes will limit growth.
When it comes to ecommerce, customers have high expectations. They expect a smooth, convenient ordering process from start to finish. This applies to both B2C and B2B customers, who are often the same people. As they grow, companies can struggle to provide the type of customer service that was easy when they were small. This is why companies often need more automation as they grow. Without it, they risk providing a poor customer experience and hitting roadblocks that hinder growth.
Part 2: How to get started with ERP eCommerce integration
Understanding the common data integration patterns for ERP and eCommerce
First things first, these patterns are not reserved to ERP eCommerce integration per se; these are general data integration patterns that apply to ANY system. But since we are now reviewing specifically the ERP eCommerce integration, let’s review them from this perspective.
There are various needs that ERP eCommerce integration can address. It’s not only about processes automation, better resources planning and effective inventory management, but also about availability of the most up-to-date customer, product and accounting data across the entire organization in order to optimize business processes and operations.
ERP eCommerce data migration
Data migration is about shifting a specified set of data from one system to another. This pattern can be useful for several reasons: For example, if you transfer data from a legacy ERP system to a new one, or when you need to combine data from several ERP or eCommerce applications. Data migration helps manage large amounts of data and process many data records typically in batches.
ERP eCommerce data broadcast
This pattern helps transfer data from a single source system (for example, your ERP) to several destination systems in real- or near real time. Broadcasting data is transactional and designed to process data records as soon as possible, which ensures that data is kept up-to-date across multiple business software solutions.
This pattern can address probably the most common time-sensitive integration use cases such as triggering order shipment, stock updates on the store’s frontend, or sales order update in your eCommerce platform once an order was marked as shipped in your ERP. Typically, data broadcast is triggered by a push notification from the source system or is scheduled, which makes the aspect of reliability of your solution for data integration (P2P vs middleware) even more important.
This pattern does the opposite of data broadcast. In this case, data from multiple systems is automatically copied or moved into a single system, which reduces the concerns of data accuracy and timely synchronization.
Data aggregation might be useful when you want to pull and combine product data from several sources to create a single format or collect missing product information. In such a scenario ERP rarely acts as the destination system but rather one of the source systems, alongside your eCommerce platform, product information management (PIM) and product content management (PCM) solutions. Your destination could be your home-grown composite API that collects data from several systems and processes them into a single response, or a business analytics platform. The former strategy is, by the way, often used when there are mission-critical legacy business software solutions that need to be “modernized” to meet the requirements of a modern business.
Data collection, formatting and transformation as well as merging several datasets are all important considerations in such a scenario. Choosing the strategy that fits your specific ERP eCommerce integration is also key: Should your destination point rather listen for signals from other business software solutions and aggregate datasets in real time, or should this be triggered through a specific event?
Bi-directional synchronization is most useful when different systems must perform different functions on the same dataset. In our concrete example with respect to ERP and eCommerce, customer information can be updated in at least two ways: a customer logs into his profile on your online store and updates his, e.g. shipping information themselves. Or your support service received a request from a customer to update this information and did this in your ERP platform. In both cases, ideally both systems need to have the up-to-date shipping address.
With the by-directional sync pattern, you will need to first understand how many systems need to exchange information both ways. If it’s just two, a simple point-to-point connection (not to confuse with point-to-point integration!) might be enough. With more systems at work, you might need to set up a more sophisticated routing mechanism such as a pub/sub or queue routing.