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Accelerating digital transformation in retail: the integration fabric approach
August 2023
Ravi Gundimeda
Director, Cloud and Digital, PwC US
The dynamic retail landscape is facing its latest phase of disruption. Challenges triggered by COVID-19, the energy crisis and inflation are pressuring retailers to adapt to market conditions in an agile manner. To overcome these challenges, retail executives are adopting new ways to increase profits, boost customer experience and drive supply chain efficiencies.
Cloud-first means API-first
The complexity of securely and reliably connecting business applications in the retail industry has likely increased as companies have expanded their network boundaries using cloud hyperscalers and SaaS/PaaS services. Success in this new landscape could demand pairing an adaptive cloud-first digital strategy with an API-first approach.
Upping the stakes of the challenge, however, is the constant need faced by retailers to outshine their competitors by extending their customer-centric environment into new digital platforms and marketplaces. PwC’s June 2023 Global Consumer Insights Pulse Survey revealed that 43% of consumers in the Americas use Amazon to do pre-purchase research while 26% said they leverage social media. In this environment, as retailers of many sizes create additional channels for marketing and selling their products, APIs become the key digital enablers.
From this standpoint, today’s retail organizations are no longer isolated enterprises; instead, they’ve become diverse and distributed ecosystems comprised of employees, customers, business partners and suppliers and driven by different processes and systems. This level of interconnectedness means that strategies striving to integrate the growing array of point-to-point APIs one project at a time may confront intractable challenges from API sprawl and uncoupled applications and data.
What’s required is an integration fabric architecture that gives the retailer the agility to move quickly and react to market disruptions in real time, while also reducing cost and time and boosting security and resilience.
Fabric architectures bring deep interoperability
The integration fabric approach is an architectural strategy that uses business capabilities to access and connect data across a diverse and distributed ecosystem. By employing abstracted layers of interoperable APIs to link applications, services, data, processes, devices and user interfaces, it gives the enterprise ecosystem broad access to the underlying assets and information.
The integration fabric approach can achieve this objective in three essential ways:
1. This approach makes it easier to manage and secure API connections between different systems.
For example, an integration fabric can be used to set up a common authentication and authorization service for API connections, making it easier to control access to sensitive data.
2. An integration fabric can be used to automate the flow of data between different systems.
In this scenario, it enables the automatic transfer of customer purchase history data from an e-commerce platform to a CRM system, greatly reducing the need for manual data entry.
3. An integration fabric can be used to provide a unified view of data from different systems.
It can achieve this, for instance, by combining data from an e-commerce platform, a warehouse management system and a CRM system, thereby providing a single 360o view of customer purchase history, inventory levels and marketing campaign performance.
Bringing it together, consider the retailer who decides to add as part of its omnichannel strategy a third-party marketplace platform like Amazon as a sales channel to its already existing e-commerce platform. Using an integration fabric approach, the retailer can quickly add this channel by leveraging the existing backend API services (like order fulfillment, inventory management, etc.) that are independent of the sales channels.
Let PwC be your guide
To help our retail industry clients accelerate their digital transformation journey, PwC has developed adaptable, reusable assets using an integration fabric approach. This approach allows you to adapt and innovate throughout the process.
Get in touch with us to find out more about retail-specific use cases, industry-proven examples and insights that can help shape the future of your retail business and accelerate your digital transformation.
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