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With cloud computing making integration easier, order management systems can deliver more than packages.
Topics: Aberdeen Group, BostonProper.com, Brian Horakh, CenturyNovelty.com, Chris Cunnane, Craig LeClair, Forrester Research Inc., Ian MacDonald, Jerome Coudier, Jill Morrow, Margaret Moraskie, Micros Systems, Inc., OrderMotion, ProSafetySupplies.com, Tikimaster.com, Zoovy Inc.
At BostonProper.com, the apparel e-retailer calls its order management system the mothership. The back-end data it manages steers every step of the e-commerce process, from typical order management processes like fulfillment and accounting to key elements of the site user experience, customer service and marketing, says Margaret Moraskie, BostonProper.com's senior vice president of marketing.
Moraskie says the 'mothership' supplies consumers with the consistency the company feels is essential to its e-commerce and catalog marketing strategy. For example, customers shopping the site get the same product availability and promotional offer information they would get from call center agents.
'We want our customers to have a seamless customer experience no matter how they reach us,' she says. 'With everything connected in one system, the message a customer is going to get on the site is not going to be different from the message they get from our call center. We're not promising what we don't have.'
That consistency is achieved by the order management system from Micros Systems Inc. continually communicating inventory levels to customer service as well as to the web site. When stock of a particular product is running low, a sell-out warning appears on the product page for consumers to see, for example.
Besides being tied into the customer service system, the order management system also integrates with the company's e-mail platform so that when a new customer placing an order opts in to receive promotional messages, the order management system immediately adds the address to the e-mail database. Prompted by the addition, the e-mail system automatically generates e-mail updates on order and shipping status, and then sends a thank-you message about a week after the consumer receives the shipment.
The Micros order management application resides on the Internet, making it an example of the cloud computing that is increasingly popular—and that experts say makes integrating applications easier.
'People are moving to the cloud because those integrations are easier to do there,' says Forrester Research Inc. analyst Craig LeClair. One reason it's easier is that cloud-based applications—also often referred to as software as a service or on-demand software—tend to be built with similar, modern programming languages, says Brian Horakh, chief technology officer of e-commerce platform provider Zoovy Inc.
Analysts say the emergence of cloud computing in recent years coincided with online retailers' desire to make better use of the customer data they collect. 'In the e-space, one trend is to view the order information as supporting your overall data warehousing and marketing analytics efforts. It's a parallel trend to cloud computing and software-as-a-service,' LeClair says.
The trend of relying on applications that live on web servers is growing. Revenue for software-as-a-service applications grew 27.3% from 2007 to 2008, and 16.8% from 2008 to 2009, says technology research firm Gartner Inc., which forecasts a compound annual growth rate of 15.3% from 2009 to 2014.
CenturyNovelty.com is an example of an online retailer taking advantage of the integration of several cloud-based applications.
The e-retailer's order management system from OrderMotion Inc. is tied into personalization software from MyBuys Inc., the Mercent Corp. system that handles product feeds to comparison shopping engines and a Marin Software paid search marketing application, says Ian MacDonald, vice president and general manager of CenturyNovelty.com.
MacDonald says there's a big advantage to being able to enter only once information that may affect all these applications, such as new inventory arrivals. For example, recording the arrival of a hot product at the warehouse into the order management system lets Marin know to add it as a paid search term and Mercent to add it to comparison shopping engines. OrderMotion manages system updates from vendors on its customers' behalf. E-retailers can choose to pay OrderMotion based on the number of transactions or by the dollar amount processed.
'The key advantage is you are able to plug into all these things at once. It is paramount that these systems can communicate together,' MacDonald says. 'In our previous platforms, each of these things was different and you had to cobble them together and create the same information in three spots. Here, you create it in the system and it goes to all the required places.'
For CenturyNovelty.com, which has about $6 million in annual sales, the integrated systems save time and keep disparate operations on the same page. The company uses the system's selection of built-in report-running modules that automatically update key performance indicators or scheduled events.
Each person that uses the system internally has access to the reports he needs. For example, a warehouse manager can see what shipments are due to arrive the next day and adjust staffing levels accordingly, MacDonald says. A marketing manager sees which products are the hottest sellers and can raise paid search bids on those terms through OrderMotion's integration with Marin Software.
While web-based order management systems like those from OrderMotion and Micros are now developing the ties to marketing and customer service systems, those links have always existed in e-commerce platforms that include order management functions. And when the platform resides in the cloud, it is that much easier for it to tie into other web-based applications.
Zoovy Inc. is an example of a vendor of a cloud-based e-commerce platform designed for smaller e-retailers that incorporates back-end functions like order and inventory management with front-end functions like site design and updates. Zoovy's cloud-delivered service features more than 80 integration options with vendors such as remarketing display ad vendor Veruta and drop shipper Doba Inc. 'With integrated systems, you can do things more intelligently. You can issue promotions based on purchases or incentivize desired behaviors because you have that data integrated,' Horakh says.
Those extended capabilities are what some retailers demand, says Chris Cunnane, senior research associate at Aberdeen Research. 'As the order manager, you want to satisfy the order. That's at your core. But absorbing that data into repositories so that others can access them and do more with them, that's the kind of agility for order management that's required in the e-commerce and multichannel retail space,' Cunnane says.