Whether you’re launching your first eCommerce initiative, overhauling an existing channel, or just gathering information, one thing’s for sure: eCommerce presents unique challenges for manufacturers.
While no one playbook will fit every organization, there are principles that every organization should use to chart their course. In this whitepaper, we’ll examine those principles and help you build a plan for your organization. Let’s dive in (click to jump): 1. Determine the depth of SAP integration required within eCommerce
2. Determine the scope of the customer journey that requires SAP integration
4. Let your SAP integration requirements guide your choice of platform
When it comes to manufacturer eCommerce, one question will define every aspect of your initiative:
Do your web customers need to interact with your SAP ERP system in real time as they build and place orders?
If you’re not sure, here’s a high-level list of eCommerce functionality that’s only available in a real-time integration scenario. If you answer yes to any of these, you’ll need some form of real-time SAP integration to support your eCommerce transactions.
If your customers need real-time SAP integration, then keep reading—we’ll help you explore your options and build a plan that fits your organization’s needs. We’ll talk about defining the scope of the customer journey which you want to cover, evaluating your integration options, and choosing an eCommerce platform. If your buyers don’t need to interact with your SAP ERP system in real time, then you can pursue a conventional eCommerce project using a platform like Magento, Bigcommerce, Salesforce, or SAP Commerce Cloud, passing data to and from SAP via batch updates. To compare these eCommerce platforms in an SAP ERP scenario, skip to our platform comparison section.
Not every eCommerce solution is prepared to cover the entire customer journey with real-time SAP integration. You’ll want to define the scope which you’ll cover first, then look for a solution that can handle the entire scope.
For example, a conventional, B2C-style platform will cover the basics of eCommerce—product catalog, cart/checkout, credit card payment at time of order placement, and order updates. If ERP interaction is required, it will usually take the form of batch updates between SAP and eCommerce.
However, for manufacturers, reliance on batch updates can create gaps in customer experience. Without real-time integration, a manufacturer’s channel partners can’t get crucial information or functionality which they need at that stage.
Here’s what that looks like at every stage of your customer journey.
Real-time credit status. For manufacturers’ customers, credit status can make or break a transaction. Buyers need visibility into their current credit status so they know if the order they’re about to place will go on credit block. Alongside real-time credit status, you may want to offer the ability to pay down invoices (see below, “III. Post-order care stage”).
Real-time inventory/ATP availability in the catalog or cart. This data is generated by a complex calculation in SAP, and it’s often personalized for different customers. Because real-time changes in the underlying inventory quantity will modify each customer’s ATP calculation in SAP in real time, the eCommerce solution needs to get this information from SAP in real time.
Accurate contract pricing, including bundled/scaled pricing discounts. This data lives in SAP; and while it typically remains static (meaning it’s a potential candidate for batch updates), there’s less hassle and potential for bugs if pricing is pulled directly from SAP in real time. This is particularly true if you run promotional price changes which are defined in SAP, or if pricing fluctuates due to outside factors. With a direct, real-time integration loading pricing into the web store, you know eCommerce will always display the right price for every customer, no questions asked.
Personalized catalogs/picklists. In a B2B scenario, each customer often has an assigned list of SKUs which they’re allowed to purchase. If these picklists are rarely updated, they may be a candidate for batch updates. However, if a customer’s list of allowed SKUs changes, it’s simplest to run customers’ personalized catalogs in the web store off of real-time integration. That way, the web experience automatically reflects the state of SAP ERP as far as customer permissions.
Accurate contract pricing displayed in the cart. Here’s where real-time integration really comes into play as regards pricing. If the price for one SKU is affected by purchasing another product, you’ll need real-time integration with SAP for the shopping cart. Otherwise, you’ll have to maintain those complex pricing rules in multiple places—SAP, your middleware solution, and eCommerce. That can harm the long-term viability of your eCommerce solution (see below, “3. Determine your appetite for owning complexity”).
Only 100% error-free orders posted to SAP. How many problem orders do you want to come from your eCommerce solution? None? Then you’ll need a real-time SAP integration in the eCommerce cart which checks the order for errors. A deep integration like this should capture any problem which might require human intervention from Customer Service—things like purchasing a disallowed or discontinued SKU, ordering a disallowed quantity, and more.
Intelligent error messaging returned to the user. B2B eCommerce is really only “self-service” if it empowers customers to build and place 100% error-free orders. A deep SAP integration should support intelligent error messaging returned to the user from SAP. That way, the customer can understand why the order can’t be placed—and how to fix it.
Real-time credit status + the ability to pay down invoices online. In a B2B scenario, this is essential. Since buyers may place orders via PO (rather than paying immediately via credit card), they also need the ability to pay off invoices and keep their accounts in good standing. All of this requires real-time integration to SAP.
Full order history from all channels (not just eCommerce). Some manufacturers may struggle to eliminate older order entry methods like phone, fax, email, and EDI. Some customers will simply continue placing orders this way—or they may place orders through multiple channels. That’s why it’s important that the eCommerce portal should display orders from all channels. This gives customers a total view of their order history—plus it helps make the web channel “stickier.”
Real-time order/shipment status + shipment tracking numbers. This information lives in SAP, so if your eCommerce portal is going to provide 100% self-service, you’ll want to provide this as well. If buyers can’t get order status, shipment status, and live tracking number updates, they’re going to call Customer Service to get them, which drives up your cost of post-order care.
At every stage of the buyer journey, manufacturers’ customers will pick up the phone or send an email if they can’t get this information through self-service. That kind of customer interaction requires human intervention. At scale, this drives up your cost of doing business and defeats one of the purposes of launching eCommerce (i.e., cutting unnecessary cost from your order-to-cash cycle).
Once you’ve determined how much of the customer journey you want to cover with SAP integration, you’ll want to evaluate your appetite for owning the complexity of SAP integration. At a high level, there are only 2 ways to build a digital portal solution that’s integrated with SAP in real time:
This is where many organizations reach a fork in the road. Let’s examine how each model works in detail.
You own the complexity of 3 systems (SAP, eCommerce, middleware).
In this scenario, you choose an eCommerce platform like Magento or SAP Commerce Cloud, then select a middleware solution to pass data back and forth between eCommerce and SAP. You’ll have to maintain your SAP business rules and 3 places (SAP, middleware, and eCommerce).
In a B2B scenario with numerous complex business rules, this architecture creates a considerable workload distributed across 3 teams (eCommerce, middleware, and SAP). You’ll have to hire these resources internally or outsource the responsibility to 3 parties.
That’s why this architecture is ideally suited to a B2C scenario, in which customer-specific business rules don’t come into play.
In a B2B scenario, where customer-specific business rules dogovern transactions, we don’t recommend this architecture if your company does less than $5 billion in total annual revenue (more on that in our Platform Comparison section).
NOTE: Watch out for cost overrun from multiple vendors billing time/materials
Simply put, this architecture distributes responsibility across too many vendors. You’ll need:
Unfortunately, most vendors in this space bill on a time/materials basis. However long it takes them to fulfill the scope, that’s what you’ll pay. While it’s easy to define the scope you need at the beginning of the project, it’s almost impossible for vendors to quote those hours accurately—especially if they’re building you a bespoke integration solution.
There’s a better way—choosing a managed solution that’s built on SAP integration.
You own the complexity of only one system (SAP).
In this scenario, you choose an eCommerce platform which includes prebuilt, configurable integration to SAP. You maintain your business rules in one place only—SAP, where they’ve always lived. This architecture saves you from making duplicate investments. Without separate databases for eCommerce and middleware, you don’t have to rebuild and maintain your existing SAP business rules in two places (which is a costly proposition, both during the implementation phase, and in the ongoing support phase). Instead, you leverage all of your relevant SAP investments in eCommerce without a third party sitting between the ERP and the web store.
This architecture is ideally suited to a manufacturing scenario, in which customer-specific business rules determine every aspect of the transaction. This is the architecture that we recommend for manufacturers in the $300M – $5B annual revenue range.
In the latest B2B wave report (Q2 2020), Forrestersuggests that organizations evaluating B2B eCommerce solutions should look for deep, prebuilt integrations in addition to features/functionality:
For manufacturer eCommerce, integration to the ERP is essential for real-time inventory availability, enforcement of complex pricing rules, omnichannel order tracking, and more.
Manufacturers should choose a solution with depth of integration, overall cost, and staffing requirements that fit their business (and their budget). That’s why our B2B eCommerce platform comparison looks at two key dimensions: