The IBM Advantage for implementing the CSCC Cloud … application ... Increasing customer engagement through personalization. ... B2B or B2C commerce for the sales of the product,

Copyright © 2017 IBM Corporation Page 1

The IBM Advantage for implementing the CSCC Cloud

Customer Reference Architecture for e-commerce

Table of Contents

Introduction ................................................................................................................................................ 2

Business drivers ........................................................................................................................................... 3

Requirements .............................................................................................................................................. 4

Non-functional requirements ....................................................................................................................... 4

Cloud Customer Reference Architecture for e-Commerce ............................................................................. 5

Components ................................................................................................................................................ 7

Public network components ...................................................................................................................................7

e-commerce user ............................................................................................................................................................ 7

Channel ........................................................................................................................................................................... 8

Edge services ................................................................................................................................................................... 8

Cloud provider components ...................................................................................................................................9

e-commerce applications ................................................................................................................................................ 9

Digital experience.......................................................................................................................................................... 11

Gateway ........................................................................................................................................................................ 12

Customer care ............................................................................................................................................................... 12

Payment ........................................................................................................................................................................ 13

Distributed order management .................................................................................................................................... 15

Supply chain and logistics management ....................................................................................................................... 16

Warehouse management ............................................................................................................................................. 19

Merchandising ............................................................................................................................................................... 19

Commerce analytics ...................................................................................................................................................... 21

Marketing ...................................................................................................................................................................... 22

Data services ................................................................................................................................................................. 24

Business performance ................................................................................................................................................... 25

Transformation and connectivity .................................................................................................................................. 25

Enterprise network components .......................................................................................................................... 26


Business user ................................................................................................................................................................. 26

Internal channel ............................................................................................................................................................ 26

Enterprise application ................................................................................................................................................... 26

Enterprise data .............................................................................................................................................................. 27

Enterprise user directory .............................................................................................................................................. 28

Security .......................................................................................................................................................................... 28

The complete picture ................................................................................................................................. 31

IBM product support for e-commerce solutions in the cloud ...................................................................... 31

Scenario 1. Digital transformation of retailer’s commerce enabled by cloud .......................................................... 32

Scenario 2. Increasing customer engagement through personalization. ................................................................. 34

Scenario 3. Digital transformation of retailer’s B2B commerce enabled by cloud ................................................... 36

Deployment considerations ....................................................................................................................... 38

Summary of key considerations ............................................................................................................................ 40

Conclusion ................................................................................................................................................. 40

Acknowledgements ................................................................................................................................... 41

References ................................................................................................................................................ 41

Introduction This document is intended for IT decision makers and technologists who want to create, enhance, or reduce maintenance costs of a comprehensive e-commerce system using cloud computing. The information in the document can help you perform comparison or gap analysis between existing and ideal e-commerce solutions, and to identify solution components that could benefit from migration to the cloud.

IBM has been a leader in providing e-commerce solutions for more than a decade. Top retailers in the world use IBM commerce solutions to drive revenue through their digital channels. Whether it is providing the retail experience to customers or to business partners, IBM’s strength spans both the B2C and the B2B space.

A typical value chain model includes conceptualization of an idea for a service or a product, doing a market analysis for the idea, supply chain management for sourcing parts or resources to create or source a product, B2B commerce for procuring the parts and products, product development, marketing of the product, B2B or B2C commerce for the sales of the product, customer experience while placing the order, order fulfillment, and customer service.

The foundational components, capabilities, and interactions necessary to enable the commerce value chain are reflected in the open standard Cloud Services Customer Council Commerce Reference Architecture [1]. The scenarios and flows published with the CSCC reference architecture describe the typical capabilities and components implemented by successful organizations.

In this paper, we describe how the IBM portfolio of products, solutions, and services supports this

http://www.cloud-council.org/deliverables/CSCC-Cloud-Customer-Architecture-for-eCommerce.pdf



industry standard for commerce, marketing, supply chain, and customer service. The IBM instantiation of the CSCC commerce architecture described in this paper is enabled for both mobile and web channels. In addition, leading edge IBM Cognitive services can be used for merchandising, marketing, and supply chain management.

A holistic understanding of the e-commerce architecture is based on an understanding of the architectures for the mobile, web application hosting, big data and analytics, and IoT capabilities. An appreciation of service provider SLAs is also helpful. Refer to the Cloud Customer Reference Architecture IBM advantage papers for Web Application Hosting [2], Mobile Cloud Solutions [3], Big Data and Analytics [4], and Internet of Things (IoT) [5] for a thorough discussion and best practices on each specific topic.

Business drivers Increasing speed and agility to execute business direction, innovation, new business models, and reduced barrier to market entry are all key business drivers for implementing an e-commerce solution on cloud. In addition, these business drivers encourage deployment of e-commerce capabilities using cloud computing:

• Customer engagement: Personalization of product offerings and site content with reminders and digital messaging leads to a more engaging customer experience.

• Omnichannel delivery: Sales experience online, in store, or by mobile device is adapted to the channel and still delivers consistent functionality and user experience.

• Adapt to changes in market: Integration of social analytics into the planning process for merchandising supports a timely response to customer demand.

• Cost reduction: By placing solutions in the cloud with guaranteed uptime SLAs, the company reduces the risks of business interruptions and revenue loss. Reduce investment in on-premises infrastructure to meet seasonal peaks.

• Consistent performance: Cloud services and infrastructure offer elasticity and resilience that assures consistent user experience.

Business-to-business (B2B) specific drivers

• Business-to-business engagement: B2B engagement through contracts and e-commerce address the need to create unique business-specific commerce engagement experiences.

• Agility to change: Complex business processes driven by the market and rapidly adapting to new conditions require the agility provided by the Software as a Service (SaaS) offerings and the cloud.

• New opportunities to monetize: e-commerce in the cloud creates new ways to monetize information and data assets through establishment of peer clouds or microservices.

• Better communication: Protocol and standards requirements enable businesses to communicate with partners and do business.

https://www.ibm.com/developerworks/cloud/library/cl-ibm-leads-building-web-app-hosting-cloud-solutions-trs/index.html

https://www-01.ibm.com/common/ssi/cgi-bin/ssialias?subtype=WH&infotype=SA&htmlfid=KUW12383USEN&attachment=KUW12383USEN.PDF

https://www.ibm.com/developerworks/cloud/library/cl-ibm-leads-building-big-data-analytics-solutions-cloud-trs/index.html


https://www.ibm.com/cloud/garage/files/IBM-Advantage-for-IoT.pdf


Requirements Enabling e-commerce capabilities through the cloud can make the availability of the business functionality from the enterprise ecosystem faster and easier. The following requirement are often used to define common scenarios in the enablement of business capabilities on cloud:

• Users opt-in to receive personalized content and notifications on availability and product launches.

• Dynamic catalog based on user purchase history and shopping patterns. • Integration of systems to deliver a consistent customer experience across all channels. • Social media analysis and purchase data integrated with cognitive systems to deliver

merchandising and marketing advice.

• Creating and managing personalization rules for targeting products, content, and marketing offers. • Measuring the impact of personalization on customer browsing behavior and conversion rates. B2B-specific requirements include:

• Creating and managing customer-specific contracts for commerce. • Integration with enterprise financials and business partner ecosystems. • Better management of inventories and production schedules. • Broad visibility into market behaviors and external factors like weather that drive demand or

create logistics issues.

Non-functional requirements Non-functional and operational requirements that are especially important for cloud and e-commerce environments include security, privacy, scalability, high availability, extensibility, resiliency, backup, and disaster recovery. Table 1 summarizes the key categories for most non-functional requirements.

Table 1. Key categories for non-functional requirements

Non-functional

requirements

Typical considerations

Performance • Speed, latency, throughput of requests and data transfers to and from the cloud provider

• Matching of data location and structure to workload requirements

• Elastic scaling to ramp up or down as your load changes; only paying for what you use

Security • User management, access, authentication, and authorization, as well as integration with security systems within enterprise network

• Integrity of data and services offered by the cloud provider

• Data authorization under the control of the data owner and


driven by rules and metadata

• Auditability of all actions performed by users and cloud administrators

• Audit data available for analytics

• Respecting customer privacy and securing the customer’s access to the enterprise ecosystem

• Ability to keep the system patched and up-to-date around security vulnerabilities

Operational and

environmental

• Release cycles (consider the expected frequency and impact of future releases of the product) of the cloud provider capabilities

• Resiliency and disaster recovery offered by the cloud provider

• Integration points with enterprise systems since data must freely flow both into and out of the analytics solution; the analytics solution must preserve the rights and access needs of the data owner

Maintainability • Adaptability and ongoing development (consider likely future changes)

• Well-defined outage windows enabling enterprises to take action and minimize impact

User experience • Capability to customize appearance and branding of offered capabilities

• Internationalization and other foreign market considerations

Legal / Compliance • Compliance with regulations, industry standards

• Certification from third parties

• Use of licensed components and data sets

Resilience and capacity

management

• Reliability, availability, and fault-tolerance of the underlying infrastructure and capabilities offered by the cloud provider

• Capacity (for example, volumes of data to be held or numbers of concurrent users) on offer

Scalability • The ability of the system to adapt based on increasing or decreasing demands.

Cloud Customer Reference Architecture for e-Commerce The e-commerce and cloud architecture guidance in this article helps architects understand proven architecture patterns that have been deployed in numerous successful enterprises by IBM. Learn how to implement the architectures and scenarios using IBM products and business partners.


Figure 1 shows the elements that may be needed for creating any e-commerce solution across three domains: public networks, provider clouds, and enterprise networks.

Figure 1: Elements of an e-commerce solution

• The public network domain contains commerce users and their e-commerce channel for interaction with the enterprise. The public network also includes communication with peer clouds. The edge services handle traffic between the pubic network and the cloud.

• The provider cloud can host comprehensive e-commerce capabilities such as merchandising, location awareness, B2B2C commerce applications, payment processing, customer care, distributed order management, supply chain management, and warehouse management. Marketing takes advantage of commerce analytics which helps with digital, cross channel, social, and sentiment analytics. Using data cloud services such as weather analytics services could help in adjusting the merchandise inventory and optimizing transportation in the provider cloud. Data services can be used to generate and aggregate insight reports from the other data cloud services, enterprise data, and applications via business performance components in provider cloud. These insights are used by users and enterprise applications and can also be used to trigger actions to be performed in the e-commerce environment. All of this must be done in a secure and governed environment.


• The enterprise network domain contains existing enterprise systems including enterprise applications, enterprise data stores, and the enterprise user directory. Results are delivered to users and applications using transformation and connectivity components that provide secure messaging and translations to and from systems of engagement, enterprise data, and enterprise applications.

Figure 2 shows the relationships for supporting e-commerce using cloud computing.

Figure 2: Cloud component relationships for e-commerce solutions

Components

Public network components The public network contains elements that exist on the Internet: data sources and APIs, users, and the edge services needed to access the provider clouds or enterprise networks.

e-commerce user An e-commerce user is a customer who uses various channels to access the commerce solutions on the cloud provider platform or enterprise network.


Channel Channel retail solutions aim to provide a seamless, personalized brand experience whether the customer shops on the web, over the telephone, using a mobile device, or all of the above. Not only can you create a next-generation web channel, you can use the web to improve revenues and customer service in all channels.

Key capabilities in this domain include:

• Website: Capabilities necessary for a direct-to-consumer online store. Web storefronts enhance the shopping experience with rich capabilities—from advanced faceted search and mini shopping carts, to integrated inventory availability and product comparisons. For reference, see the Cloud Customer Architecture for Web Application Hosting. It is a best practice to ensure that the website communicates to the business services through well-defined APIs; that is, the presentation tier is separated from the business services tier.

• Mobile: Supports commerce storefronts that take full advantage of mobile device browsers, touchscreens, and location-based information to deliver an optimized and highly personalized mobile shopping experience. See IBM Advantage supporting the Mobile Reference Architecture for how IBM supports this architecture in detail. IBM WebSphere Commerce uses location-based services to target customers using global positioning system (GPS)-enabled mobile devices.

• Connected devices: Provides the ability to have connected devices place orders for depleted products. This capability helps retailers drive an alternate channel of sales where connected devices are making buying decisions when needed. IBM provides this capability through the use of RFID chips (or IoT devices) that relay the inventory status to the IBM Inventory Management System. This option provides convenience to the customer and low-touch sales to the retailer.

Edge services These edge services are distinct network components that are a part of the overall e-commerce ecosystem. Edge services allow data to flow safely from the Internet into the provider cloud and into the enterprise. Edge services also support user applications.


• Domain name system (DNS) server: Resolves the URL for a particular web resource to the IP address of the system or service that can deliver that resource.

• Content delivery networks (CDN): Supports user applications by providing geographically distributed systems of servers deployed to minimize the response time for serving resources to geographically distributed users, ensuring that content is highly available and provided to users with minimum latency. Which servers are engaged will depend on server proximity to the user, and where the content is stored or cached.

• Firewall: Controls communication access to or from a system. Firewalls permit only traffic that meets a set of policies and block any traffic that does not meet the policies. You can implement firewalls as separate dedicated hardware or as a component in other networking hardware such as a load balancer or router, or as integral software to an operating system.

http://www.cloud-council.org/deliverables/CSCC-Cloud-Customer-Architecture-for-Web-Application-Hosting.pdf

http://www.cloud-council.org/deliverables/CSCC-Cloud-Customer-Architecture-for-Web-Application-Hosting.pdf



• Load balancers: Provides distribution of network or application traffic across many resources (such as computers, processors, storage, or network links) to maximize throughput, minimize response time, increase capacity, and increase the reliability of applications. Load balancers can balance loads locally and globally. Load balancers should be highly available without a single point of failure. Load balancers are sometimes integrated as part of the provider cloud analytical system components like stream processing, data integration, and repositories.

IBM capabilities for edge services

IBM Cloud supports services for DNS, CDN, firewalls, and load balancing. IBM Cloud provides Domain Name Service for DNS and Content Delivery Network for CDN. Virtual Router Appliance (VRA) provides the latest Vyatta Network Operating System for x86 bare metal servers. You can create virtual routers, firewalls, and VPNs that fit your unique application requirements. IBM Load Balancers provide load balancer services to distribute traffic among application servers residing locally within the data center.

Cloud provider components e-commerce applications With the advent of social and mobile platforms and technologies, suppliers and retailers have started to collaborate in new ways and to provide capabilities to the customer that were not possible just a few years ago. Having a retailer participate as a delivery channel for a supplier has not only provided convenience to customers by allowing direct ordering from a manufacturer, it has extended the supplier's ability to tap into new markets and channels. For the retailer, in addition to providing convenience, it has allowed them to reach new customers and promote their brand.


• Mobile digital and store: Enables the convergence of physical and digital stores to provide new ways to reach and satisfy customer requirements for shopping, delivery, and personalization.

• Product search and personalization: Enables customers to find products more effectively. Multichannel search solutions also support keyword search, type-ahead, and search suggestions. This also extends the scope of searchable content for business users for both structured and unstructured content. The search is based around the search index, and the search index must be built before it can be used for any searches. Site administrators and business users can use search to fine-tune search merchandising to display preferred products to shoppers. Once a set of qualified products are found, further product selection and the display or order of products can be personalized based on customer and product attributes. Personalization decision rules and scores can be applied using real-time analytical engines.

• Catalog: Provides a consistent view of items offered by a retailer and allows a customer to search or place an order using a mobile device, application, or other IoT connected channel. The catalog offered to customers can be controlled by sales offerings, contracts, or many additional rules of entitlement including customer behavior and transactional insights. The catalog offering is driven by merchants and in cases for B2B sites, is additionally driven by individual contracts with participating external B2B entities. Catalog can include the capability to provide correct prices for the product and services offering in the catalog.

https://console.bluemix.net/catalog/infrastructure/domain_registration

https://console.bluemix.net/catalog/infrastructure/domain_registration

https://console.bluemix.net/catalog/infrastructure/cdn-powered-by-akamai

https://console.bluemix.net/catalog/infrastructure/virtual-router-appliance

https://console.bluemix.net/catalog/infrastructure/load-balancer-group


The pricing and promotions functions include calculations based on product, quantities, combinations or contents of the shopping cart, and in B2B sites, contracts. In a B2B commerce scenario, it is very common to have pricing and promotions being driven off a contract with the external B2B entity participating in commerce. Catalog, pricing, and promotions can also be considered common enterprise services that enable catalog, price, and promotion calculations across all participating commerce channels within the enterprise. In cases where common services are not feasible, federation of catalog, pricing and promotion data from merchandizing applications, or enterprise systems to individual systems can be used.

• Order capture: Enables the creation of shopping carts, wish lists for future purchases, shipping information, payment information, and the conversion of shopping cart to an order. Order capture also allows orders started on mobile devices to be completed in a physical store or on a web application. It also provides the capabilities of bulk order placements from a marketplace. This capability integrates and updates the captured order information into the customer's existing distributed order management processes and components. It also provides order information for customer’s order inquiries. Through integrations with customer care, order capture provides updates on the status of the order to customers using their preferences. It also provides the customer service rep for assisted order capture and placements.

• Marketplace: Allows customers to shop across multiple sellers. The marketplaces are analogous to physical malls, which provide customers with multiple shopping experiences in one convenient location. The online marketplaces typically own customer data and control the shopping experience across the sellers within the marketplace. The marketplace drives the marketing, catalog, product placements, cart management, checkout services, payment handling, order brokering and orchestration, and after-sales customer services. The customers place the order with the marketplace, and the marketplace brokers the orders to individual sellers of the product. Orders can include products from multiple sellers. In many cases, marketplaces can also provide fulfillment services that create a consistent fulfillment experience for the customer.

IBM capabilities for e-commerce applications

IBM Digital Commerce (SaaS offering on IBM Cloud) product portfolio provides a powerful customer interaction platform for cross-channel commerce on-premises or on the cloud. IBM Digital Commerce is a single, unified e-commerce platform that offers the ability to do business directly with consumers (B2C), directly with businesses (B2B), and indirectly through channel partners (for example, B2B2C). IBM Digital Commerce offers consistent views of items in the form of a feature-rich catalog, product search, and personalization, order capture, member and org subsystem, access control, pricing and promotion, and convergence of physical and digital stores.

IBM Digital Commerce is a customizable, scalable, and high availability solution that allows brands to engage shoppers in personalized, consistent ways via merchandising tools, precision marketing, site search, customer experience management, catalog and content management, and social commerce capabilities. The IBM Digital Commerce platform also includes e-commerce, promotions, inventory visibility, and order management and integrates with payments, taxes, email marketing, and analytics systems designed to transform the global go-to-market strategies for B2C, B2B, and B2B2C companies. It provides accelerated time to market and minimizes upfront investment by providing rich sets of business tools, prebuilt responsive store templates for web and mobile, and out-of-the-box integrations for key e-commerce needs.

IBM Master Data Management on Cloud provides the extensibility, scalability, and economics of cloud deployment models to the master data management system for catalog and customer data. Master Data

https://www.ibm.com/us-en/marketplace/digital-commerce

https://www.ibm.com/cloud/mdm


Management system is a critical component of any e-commerce system because it offers a central, unified, consistent view of the product catalog across a retailer’s business landscape with mechanisms to manage and govern the catalog data through its lifecycle of creation, verification, maintenance, enrichment, archival, and deletion. It includes accurate probabilistic matching and search capabilities, comprehensive pre-built data models, and mechanisms to apply policies and processes to coordinate multistep and multirole workflow for catalog data governance.

IBM Store Engagement extends access and control of store operations to store associates through intuitive mobile applications that enable omnichannel offerings like "buy online, pickup in store" and "ship from store" as well as managing returns across channels. IBM Store Engagement improves the efficiency of store personnel by giving them real-time access to customer and product information, the ability to view inventory levels at multiple store locations, quickly locate an order, check its status, make any necessary changes to it on behalf of a customer, manage returns, and efficiently perform all fulfillment tasks in the store.

Digital experience A rich, meaningful digital experience is the key to engaging customers in today’s integrated digital world.


• Content: Enables relevant personalized content to help attract and educate visitors on the benefits of the brand. Content-related capabilities include content authoring tools, content management systems, content search and personalization tools (may require integration with marketing or analytical decision engines), and content servers or portals.

• Federated search: Enables customer and business users to find information about the products, catalog, product reviews and recommendations, marketing content, how-to, knowledge repository, and customer and internal blogs in a consistent interface across multiple domain applications. The search can be used across customer-facing applications within commerce along with internal applications like customer care, order management, merchandizing, and supply chain. Search is now becoming cognitive and capable of answering customer queries in natural language. Technology advances in search now allow customer and business users to interact with systems through natural conversations. Search is also becoming a key platform to enable personalization of content for users based on contextual learning of the user's past and current interactions with the enterprise.

• Social engagement: Enables providing reviews and ranking for engaging the company and other customers in meaningful dialogs, strengthening the relationship between customers and the brand and turning customers into brand advocates.

• Digital messaging: Improves the creation, delivery, storage and retrieval of outbound communications, including those for marketing, new product introductions, renewal notifications, claims correspondence and documentation, and bill and payment notifications. These interactions can happen through a widespread range of media and output, including documents, email, Short Message Service (SMS) mobile push (including real time), and web pages.

o Email service: Keep customers informed of new products, clearances, and special opportunities that are being offered at the store. Dynamic email allows the retailer to customize email impressions with tailored programs for each individual customer.

https://www.ibm.com/customer-engagement/commerce/store-operations


o Notification: Notifications help keep the customer in touch by allowing notifications of store activities to email or cell phone.

IBM capabilities for digital experience

The following SaaS offerings complement IBM’s e-commerce solutions by enhancing content

management, search, integrations, mobile devices, and digital marketing.

IBM Digital Experience on Cloud provides a scalable full-feature content management system for multisite and multidevice e-commerce solutions. It provides intuitive tooling for line of business users and well defined integration patterns with various systems of record and applications in an e-commerce solution such as WebSphere Commerce. It enables creation, management, and omnichannel delivery of personalized experience considering role, profile, device settings, and more. Its Cognitive Appender capabilities enable merchandisers to automatically tag all of their CMS content using Watson’s state of the art language understanding and vision services.

IBM Digital Commerce offering includes WebSphere Commerce Search built on the open architecture of Apache Solr to provide catalog browse and navigation capabilities such as keyword text search, auto-suggestions, spell checks, faceted navigation, sorting, and pagination. IBM Digital Commerce also includes line of business, user friendly business tooling to control product results listing through search rules and caching models that align with WebSphere Commerce services, as well as multiple index cores to support product, category, and inventory searches.

Watson Campaign Automation (part of IBM Watson Marketing) provides a comprehensive platform for designing and delivering customer experiences across email, SMS, mobile push, and social and web channels. This enables companies to tailor their messaging and cross-channel shopping experiences based on customer profiles and behaviors. Mobile device location awareness capabilities also enable retailers to integrate geo-fencing into their SMS and mobile services to provide a seamless shopping experience for their customers across both digital and physical channels.

Gateway Allows smart devices to communicate with in-store networks to search or shop and pay. This can have the same capabilities and requirements for security and scalable messaging as a mobile gateway or an IoT transformation and connectivity gateway as referred in the IoT architecture [6].

IBM capabilities for gateway

IBM StrongLoop® API gateway also provides mobile gateway functionality. IBM Watson IoT Platform provides IoT transformation and connectivity gateway.

Customer care Supports customer care across the entire transaction lifecycle and all commerce channels where customer care personnel can see the behaviors of a customer in more than one channel. Whether customer care is entirely self-service or provided by customer service personnel, delivering personalized care requires access to a range of data typically residing on multiple systems, including data from warehouse, logistics, websites, and PoS. Online customer care is frequently offered in real time, based on user behaviors such as abandoning a shopping cart or clicking back and forth between pages multiple times.

http://www-01.ibm.com/software/collaboration/digitalexperience/cloud.html


https://www.ibm.com/us-en/marketplace/digital-marketing-and-lead-management

https://www.ibm.com/watson/marketing/

http://www.cloud-council.org/deliverables/CSCC-Cloud-Customer-Architecture-for-IoT.pdf


Strides in cognitive computing and natural language processing have enhanced customer care functions. Customer care can now be provided anytime, anywhere by using cognitive customer care applications that provide natural language interactions from the mobile or web application. Understanding the customer, the history of interactions, transactions, and current context can all be used to offer a personalized customer care experience. Key capabilities in this domain include:

• Customer relationship management (CRM): Provides broad and deep visibility into a consumer’s current and historic behavior. This is accomplished through the collection and aggregation of information from tools and sources that make up the commerce analytics domain.

• Loyalty management: Allows the e-commerce provider to build and track customer loyalty across the customer’s interactions. These systems enable various kinds of loyalty programs tied to a customer’s profile, and loyalty is tracked either directly or through transactional feedback from order e-commerce applications. In addition to creating and managing loyalty programs and tracking, these systems manage various kinds of reward programs. Loyalty programs play a key role in defining the interactions between the customer and the e-commerce provider, help build brand awareness, and also contribute to customer retention.

IBM capabilities for customer care

IBM Commerce suite of products integrates with a certified list of third-party loyalty and CRM solutions to provide complete CRM and loyalty management capabilities. IBM’s Bluewolf services group provides expertise for integration with Salesforce.com. Combining the capabilities of IBM Master Data Management on Cloud, IBM Watson Campaign Automation, and commerce analytics along with certified third party customer relationship management and paid advertisement systems integrated over IBM Universal Behavior Exchange (UBX) enables retailers to acquire, farm, and centrally maintain customer demographics, transactional and behavioral information across all channels.

Payment Key capabilities in this domain include:

• Payment processing: Supports payment transactions using credit cards or electronic fund transfers which include at least these roles:

o Merchant

o Customer

o Merchant payment processing service provider

o Merchant bank if different than payment processor

o Customer’s bank or bank issuing credit or purchase card

Payment processing can be a for-fee service, where merchants are charged per transaction processed, typically a percentage of the individual purchase. The cost of the service is offset by the benefits of a faster settlement process. The merchant has more cash on hand. Customers benefit from the security and convenience compared to mailing checks or the additional cost of money orders. The complexity of the transaction process and the stringent data security requirements and

https://www.ibm.com/services/salesforce




https://www.ibm.com/customer-engagement/partners/find-partner

https://www.ibm.com/customer-engagement/partners/find-partner

https://www.ibm.com/commerce/us-en/universal-behavior-exchange/



regulations often make it more cost efficient and less risky for companies to outsource this function to a payment processor who is an expert in the relevant standards and fraud detection. The payment processor is responsible for authenticating the validity of the eCheck, credit, debit, or gift card with the card issuer, sending the confirmation to the merchant’s bank and ultimately carrying out the electronic funds transfer (EFT) from the customer to the merchant bank. The payment processor covers only part of the overall security and fraud detection domain.

In the US, payment processors initiate the EFT through the US Federal Reserve Bank’s Automated Clearing House (ACH). There is no single counterpart to this system in other parts of the world. The global standard for how companies process, store, and transmit credit or debit card information is known as PCI DSS (Payment Card Industry Data Security Standard). This standard covers payment processors, point of sales, and the interchange systems operated by the card brands.

Tokenization and end-to-end card encryption are essential to protect cardholder data and to ensure the e-commerce providers adhere to the PCI standards. End-to-end card encryption on the card scan device is used at POS and stores, as customers can physically present or scan their cards there. Tokenization (internal or external) is used on web and mobile channels where physical card scans are not possible. The payment processor often provides credit card machines or other equipment for processing cards at the POS.

There is also an increasing adoption of newer forms of electronic payments like digital wallets such as Apple Pay, Android Pay, PayPal, and others. These digital wallets provide secure and convenient transactions options to the customer and also significantly reduce the risk of fraud and associated chargebacks for e-commerce providers. In addition, e-commerce providers can use their own virtual currencies like virtual coins, points, and loyalty rewards. Each of these currencies require special handling during payment processing.

• Payment gateway: The payment gateway is the mediator between the e-commerce transaction and the payment processing service. Security requirements for purchase card transactions prohibit the direct transmission of information from the website or POS system and the payment processor. Payment gateways may be offered as a service by payment processing vendors or contracted from a vendor who only offers a gateway service. Merchants who have found it difficult to keep up with the introduction of new payment types, such as wallets, while still offering a localized payment experience will find this a simpler, more efficient approach. Payment processing and payment gateway serve two different functions. Payment gateways are always needed for Internet commerce. If a business does not accept payments online, a payment gateway is not necessary. For Internet merchants, both payment processing and payment gateways are required. Many payment processors also offer payment gateway services—selecting a single provider can simplify issue resolution if there is an outage or dispute.


Distributed order management Supports inventory, order processing, and order visibility. It orchestrates the workflow of orders from distribution centers or warehouses, suppliers, and third-party vendors for direct fulfillment and stores. Distributed order management delivers a superior customer experience by executing and coordinating order fulfillment processes across the extended supply chain network. It can provide flexible, process-based management of orders from multiple channels and enable customized fulfillment based upon user-defined business requirements. It also delivers the required visibility and event management across all fulfillment activity, allowing quick response to unexpected problems and meeting customer expectations.


• Order management and orchestration: Manages, aggregates, and monitors orders from virtually all channels, usually with an intelligent sourcing engine that coordinates fulfilment across the extended enterprise. Supporting a virtual single order repository gives customers, channels, suppliers, and trading partners access to modify, cancel, track, and monitor the order lifecycle in real-time. Flexible fulfilment gives the capability to check for inventory availability, provide rule-based dynamic allocation, enable transfers when a required item is out-of-stock, select locations based on inventory availability, split orders as needed, and source or drop-ship from a channel partner.


• Global inventory visibility: Provides a consolidated view of inventory in warehouses, stores, and third-party vendors, helping coordinate inventory across multiple sites, enterprises, and sellers, allowing managers to track inventory anywhere at both internal and external ship nodes. Global inventory visibility solutions give you a synchronized real-time availability view of virtually all supply and demand from multiple systems and channels, including in store, in warehouses, at distributors, at suppliers, and in transit. Global inventory visibility solutions use an intelligent sourcing engine that optimizes inventory use across the extended enterprise, to provide the best available-to-promise (ATP) dates and the most efficient fulfillment options. It also identifies shortages and allows inventory planners to resolve problems by manipulating inventory balances, through allocation of sales orders and execution of purchases or movement of inventory. Data can be shared with external systems, customers, suppliers, and partners for demand and supply management.

• Returns management: Provides capabilities to manage the entire order returns process. This capability enables the buyer and the seller to effectively track items throughout the return and repair process and automates the procedures that return items to stock. Real-time status updates from service and repair organizations also enable sellers to leverage the returns processing cycle as a source of supply. Returns management links multiple returns or repair requests to the original sales orders, providing repair lifecycle tracking to track items throughout the returns and repair processes, including exchange orders, refurbishment and repair requests, and return disposition.

IBM capabilities for distributed order management

IBM Order Management offers centralized order orchestration and execution of coordinated and customized fulfillment, providing a single source of order information and a single view of supply and demand across all selling channels. It provides inventory visibility to all internal and external inventory locations, which gives shoppers alternate purchase options and accurate promise dates. A directed workflow process automates exchange, return, and repair management while linking the transaction to the original sales order to provide complete order lifecycle tracking. A web-based call center solution and a store add-on option supports informed omnichannel interactions and enables “order from anywhere and fulfill from anywhere” capabilities by extending fulfillment options to store associates.

IBM Watson Order Optimizer enables omnichannel fulfillment practitioners to apply cognitive science to determine how to best route customer orders across their supply chain for fulfillment. Watson Order Optimizer uses advanced machine learning models to predict demand and inventory levels across the supply chain and then optimizes the order routing for fulfillment to any distribution center or physical store in the network. Decisions are automatically made based on tradeoffs between real-time capacity balancing, cost minimization, and priority delivery deadlines.

Supply chain and logistics management This capability enables systems to plan and manage the products and lifecycle, supply network, and inventory, including replenishments, distribution strategies, partner alliances, and related analytics. Logistics management helps manage the internal logistics for purchasing, production, warehousing, and transportation within the enterprise to make sure the right products are available to customers in the most efficient and cost-effective way possible.


https://www.ibm.com/us-en/marketplace/order-management-platform

https://www.ibm.com/us-en/marketplace/omni-channel-fulfillment


• Supply chain management: Enables procurement of raw goods and materials to effectively deliver the finished product to a customer. Traditionally, the supply chain operated independently from marketing, provisioning, or inventory management and often had conflicting goals. With the advent of digital marketing and focus on omnichannel, the supply chain has become an integral and critical part of service and delivery to a customer. For example, weather analytics can immensely affect the supply chain management and should be part of its key considerations.

• Product lifecycle management (PLM) and manufacturing: Supports all aspects of a product, from inception to the ultimate end of life. Phases include design, engineering, manufacturing, distribution, and marketing and encompass people, processes, and technology. Efficient PLM systems assist retailers with the ever-increasing complexity realized by a global marketplace. It helps retailers effectively manage complex supply chains, ever-changing customer preferences, and design challenges.

• Sourcing and procurement: Sourcing supports the component of the procurement process that deals with supplier selection and management. With a global economy and the ability to source and manufacture products across the globe, an efficient and intelligent supply chain is critical for the survival and success of a retailer. Procurement systems have advanced significantly and form the pivotal link between commerce, order management, and delivery.

• Supplier and partner data communications: Enables retailers and other commerce constituents to securely communicate business documents on shipments, inventory, invoices, purchase orders, acknowledgments, contracts, and more. Such systems should have the ability to extract, classify, encrypt or decrypt, transform, and transmit data with other commerce constituents that are external or internal to a retailer. Inherent in such data communications are security, high performance, audit, verification, automation, transport layer independence, and authentication for the retailer and their business and trading partners. The use of blockchain technology for supply chain management can dramatically reduce time delays, added costs, and human error that plague transactions today. Blockchain technology allows for secure and transparent tracking of all types of transactions across the supply chain.

• Transactional event ledgers: Transactions across trading partners like suppliers, vendors, carriers, and B2B customers are driven through individual enterprise applications and the partner’s application. For example, in a vendor shipping situation, a purchase requisition is sent to the vendor or supplier as an electronic document through various communication channels. The transaction event log is maintained in a PO management system, off the sender, the broker, and the receiving vendor’s sales order management system. These systems then work in isolation without a good way to ensure transaction integrity across partners or their applications. There is also no easy way to find the transactional events and logs through a trusted repository. Cases of discrepancies often require an audit or dispute between the parties and manual intervention to pull records from individual systems to validate the correct set of events and transactions. Sometimes intermediaries are needed that both parties trust, as in the case of certificate issuing authorities for digital certificates or stock exchanges for stocks and US Federal Reserve for banking. Intermediaries sometimes become a bottleneck and are not practical for


many transactions within commerce. Distributed transactions and events managed through crypto-technologies like blockchain provide a secure and intermediary-free ledger and validation of transactions across parties. Blockchain-based applications are evolving rapidly to provide distributed transactional ledgers to capture transactions and transactional events across commerce applications and partners involved in commerce.

• Transportation management and optimization: Transportation management provides a retailer with the ability to source, transport, and deliver goods effectively while managing customer demand across multiple modes of transportation and providers. Transportation identifies and uses the most efficient and cost-effective manner to deliver products and services. It gives the retailer options that allow them to make critical business decisions related to profitability or cost, while providing them with the ability to maintain delivery schedules in the event of a failure within their supply chain.

IBM capabilities for supply chain and logistics management

IBM’s supply chain and logistics capabilities are available on-premises or on the cloud. These capabilities

complement the e-commerce and digital capabilities.

IBM Watson Supply Chain Insights leverage cognitive technology, trained in supply chain, to provide comprehensive search, visibility, and insights across the entire supply chain. Its Ask Watson capabilities enable supply chain managers to ask questions and gain insights into the state of their business through natural language conversations. With Watson Supply Chain Insights, organizations can predict, assess, and mitigate disruptions and risks and can use these insights to optimize the supply chain to deliver greater value to the business. IBM Transformation Extender helps automate complex transformation and validation of data between a range of different formats and standards. The solution provides complex data processing capabilities for some of the most mission-critical applications in the world—from stock exchanges and pharmaceuticals to manufacturing, insurance, and global commerce.

IBM Master Data Management on Cloud provides a complete and powerful product lifecycle management through extensible data models, collaborative workflow management, and product management, ensuring compliance through a quantitative and probabilistic policy monitoring and enforcement and data quality through advanced statistical techniques of search and match. Through a rich single and multi-product edit screens user interface, a retailer can create and manage complete and consistent product information across all commerce channels while providing a single view to all their suppliers and partners.

IBM Supply Chain Business Network helps you to more effectively collaborate with your vendor partners by automating and digitizing your B2B document flows through a safe, reliable network. It also provides a comprehensive set of analytics that enable you to gain deep visibility into B2B transaction life cycles and partner performance. Your procurement and supply chain practitioners can ask Watson questions about the status of specific orders or vendor performance to quickly resolve issues and understand your relationships with vendors.

IBM Sterling B2B Integrator, with an option of private cloud or on-premises deployment, gives enterprises visibility into and across supply and demand chains by enabling business processes across enterprise and business partners through an auditable, verifiable, automated, transport layer independent, authenticable, security-rich, high-performance, and high-availability integration through

https://www.ibm.com/us-en/marketplace/supply-chain-insights

https://www.ibm.com/us-en/marketplace/data-transformation-software


https://www.ibm.com/us-en/marketplace/partner-collaboration-network

http://www-03.ibm.com/software/products/en/b2b-integrator


supplier and partner data communications. The product provides for the receiving, transmission, and routing of files with features like automatic re-tries, non-repudiation, and traceability. This product enables enterprises to securely communicate business documents shipments, inventory, invoices, purchase orders, acknowledgments, contracts, and more. It has the ability to extract, classify, encrypt/decrypt, transform, and transmit data with other commerce constituents that are external or internal to a retailer. IBM Blockchain is a transactional event ledger that provides a high security, isolated environment for businesses to conduct transactions over a public network through a permissioned network and known identities without the need for cryptocurrencies. Blockchain enables verification of transactions, which minimizes the risk of collusion, tampering, and unintentional exposure of information, while allowing enterprises to recognize and reduce overhead of intermediaries and inefficient processes. Available with IBM Cloud, enterprises can build expertise in enterprise blockchain development and access expertise and technical resources in the IBM Blockchain Workshop to accelerate their blockchain ventures.

Warehouse management Enables efficient management of warehouse operations. Combining a warehouse management system with a wireless network, mobile computers, radio frequency identification (RFID) technology, voice picking applications, and barcoding can help fully extend your enterprise to the mobile worker, while increasing operational efficiencies and enhancing your customer service. In omnichannel commerce, physical stores are increasingly being used as fulfilment centers to enable pickup in store, ship from store, and process returns at stores.


• Warehouse inventory management: Supports systems to replenish stock, track costs of inventory, track profits, forecast inventory, forecast prices, forecast demand, and more. The process interacts with systems to track orders, shipping, costs, stock, and sales, and software that may be used to predict inventory status and track materials. Optimized inventory management will help keep costs in check, maintain a proper merchandise assortment, set targets, and monitor profits efficiently.

• Inventory optimization: Optimizes capital investment constraints or objectives over a large assortment of stock-keeping units (SKUs) while managing demand and supply volatility to provide the correct products to shelves.

• Inventory: Holds the complete list of merchandising items or goods in stock—on hand, in transit, or returned.

Merchandising Merchandising planning involves marketing the right merchandise or service at the right place, at the right time, in the right quantities, and at the right price with the goal of optimizing margins, gross revenue, or shelf life.


http://www.ibm.com/blockchain/

https://www.ibm.com/blockchain/garage/


• Assortment management: Managing products and their variations to make them available to the customers in a meaningful way. Good assortment management enables customers to easily identify products based on familiar categories while shopping, helps merchants work with different customer profiles fitting their categories, and enables the merchants to make the right decisions of what product and assortments to sell in a particular channel.

• Pricing management and optimization: Involves ways to set and manage pricing and promotion of product and services based on pricing policies, strategies, goals, and objectives. With pricing and promotion optimization, merchants set appropriate price points and promotions to achieve goals like increasing market share, maintaining margins and profitability, responding to competitive pressures and volatile costs, and maintaining a channel presence. Recent advancements allow commerce providers to enable dynamic pricing and promotions to support personalized pricing and promotional offers. The pricing and promotion optimizers also enable the merchants to run “what-if” simulations to understand the impact of certain pricing strategies and tactics.

• Product placement: Enables merchants to figure out where and how to display the products and services across customer channels to have maximum positive impact on sales. The product placements on the site tremendously influence sales. Merchant tools should allow merchants to do A/B testing and evaluate the impact of product placement or content selection within a site or partner channel to achieve their objectives. Statistical experimentation to carry out various schemes and approaches are being driven by cognitive systems that ease the burden of manual trial and errors.

IBM capabilities for merchandising

IBM merchandising capabilities are available on the cloud. These solutions complement the previously described capabilities of the IBM e-commerce solutions. IBM Commerce solutions also integrate with third-party assortment optimization solutions.

IBM Price Optimization helps sellers optimize product base pricing using customer demand analysis and what-if scenarios to model and optimize prices based on advanced factors like trends, item elasticity, and seasonality. It further simplifies the pricing management by providing capabilities like pricing policy definition and enforcement, rule configuration using natural language editing, rule prioritization, and rule relaxation. IBM Price Optimization also uses advanced predictive analytics to evaluate the impacts of changes in competitive pricing and changes in pricing across channels give merchandizers a holistic view of the market demand for their products.

IBM Dynamic Pricing is a cognitive solution that helps sellers automatically optimize their online pricing in highly competitive ecommerce markets. IBM Dynamic Pricing uses advanced predictive and optimization models to automatically adjust pricing to current market conditions based on its understanding of current consumer demand, competitive pricing, and the merchandiser’s goals and business constraints.

IBM Configure, Price, Quote transforms the buying and selling of complex products and services across all of your customers' preferred channels to deliver compelling efficiencies. Our streamlined CPQ solution guides e-commerce customers, sales teams, call center representatives, and partners to select and configure the right products, at the right price, for the right customer. IBM CPQ helps your business to provide a complete and customized solution for improving customer experiences by reducing the complexity of configuring and pricing your products and reducing sales order processing times.

http://www-03.ibm.com/software/products/en/ibmprice-optimization

https://www.ibm.com/us-en/marketplace/dynamic-pricing

https://www.ibm.com/us-en/marketplace/cpq-software


IBM Watson Commerce Insights offers cognitive product sequencing capabilities that enable merchandisers to optimize the placement and sequencing of products on their websites. These capabilities use machine learning to understand how the placement of a product on the web page affects the likelihood that a customer will click on the product or purchase the item. It then recommends the product placement of the items on the page based on this understanding of consumer behavior and the merchandiser’s goals for that product within the category assortment.

Commerce analytics Enables optimization of the shopper’s journey and improves the sales and revenue for the business. Commerce analytics include digital analytics, cross-channel analytics, social commerce and sentiment analysis, and merchandise analytics. Commerce analytics should drive the next-best action solution. A next-best action solution delivers the most appropriate action at the right time across channels, maximizing the customer and business value. Personalized interactions are enabled by a comprehensive view of a customer, real-time predictive analytics to anticipate customer behavior, preferences and attitudes, and cross-channel delivery of best action to address customer need and enhance long-term business revenue. Key capabilities in this domain include:

• Digital analytics: Enables monitoring of online customer interactions, including the time customers stay on a specific section or product page and click-throughs for a specific website. Digital analytics improves the customers’ web experience and directs their attention to specific products or services that they have liked in past visits. The use of digital analytics helps render a dynamic offer for the customer on the website.

• Cross-channel analytics: Enables predictive, cognitive, and prescriptive analytics across all the channels that customers engage in. Predictive analytics use historical data and future predictions in specific markets to deliver targeted customer messages. Cognitive and prescriptive analytics are based on historical data to personalize each shopper interaction.

• Social commerce and sentiment analytics: Feeds social media sites such as Twitter and Facebook information about specific products or services with commerce analytics. For example, due to a weather pattern in certain regions, specific items may be in greater demand. Areas experiencing bad weather might need extra inventory of generators, umbrellas, and emergency food items.

• Merchandise analytics and optimization: Draws insights from the customers’ journey to ensure that further optimizations can be achieved for maintaining inventories and improving sales and revenues.

IBM capabilities for commerce analytics

IBM offerings that support commerce analytics include functionality that is built into e-commerce SaaS and other applications, as well as integration and cognitive services to expedite visibility into hybrid e-commerce architectures.

IBM Watson Customer Experience Analytics is a suite of products that allows you to view your e-commerce sites and applications from your customer’s perspective to discover opportunities for improving customer experiences. It provides a seamless, end-to-end view of customer interactions across

https://www.ibm.com/us-en/marketplace/watson-commerce-insights

https://www.ibm.com/us-en/marketplace/customer-experience-analytics


channels to help you to understand and optimize every customer journey. It also gives you the insights you need to resolve issues, boost conversions, and maximize lifetime customer value.

The digital analytics capabilities in Watson Customer Experience Analytics provide you with a comprehensive set of web analytics to track customer behavior across your web and mobile web properties. Struggle detection capabilities use artificial intelligence algorithms to detect usage patterns in your site and applications that might indicate user struggle. Session replay capabilities allow your team to visually replay any user session to directly view what the user experienced.

Journey Designer enables marketers and merchandiser to collaboratively design unique cross-channel customer journeys. Journey Analytics provides a platform to give you a holistic view of customer’s experiences with your brand across all of your channels. It has embedded cognitive capabilities that enable you to understand which patterns of interactions within an omnichannel journey were crucial to the customer experience and to moving them forward in their journey with your brand.

IBM Universal Behavior Exchange (UBX) is an open data exchange that enables sharing of customer interaction data and customer segments across different certified solutions. It works via a publish/subscribe pattern that enables applications to share interaction and customer segment data across your different marketing and merchandising platforms. This allows you to integrate data across marketing and merchandising enabling you to automate personalization and trigger campaigns across paid, earned, and owned channels, increasing conversions and returns on investment. UBX is powered by an open ecosystem of the most widely used social, mobile, CRM, and paid advertisement providers along with IBM’s marketing and commerce platforms (such as IBM Watson Customer Experience Analytics, IBM Watson Real Time Personalization, IBM Watson Campaign Automation, and IBM Watson Commerce Insights). IBM Watson Commerce Insights provides merchandise analytics and optimization capabilities to the merchandiser with business data and analytics in a single view, allowing them to gain insights into customer behavior, market opportunities, and competitive threats faster without having to search across different tools and systems. Using natural language and visualizations, it helps business users make sense of vast amounts of disparate data, highlight what is important, and prescribe the next best actions for customer experiences and to meet revenue goals and margins. Commerce Insights also includes cognitive alerting capabilities that learn about your business over time and notify you of unusual business conditions or behaviors. IBM Watson and Alchemy Services provide the capabilities for analyzing tones, social commerce, sentiment analytics, and weather-related decision making.

Marketing Marketing involves personalized offers, content, and product presentations that move customers along in their journey from product exploration to purchase decisions to transaction completion. Marketing channels include traditional communication channels, direct mail, email, mobile, and social media. Digital marketing, along with mobile and social channels, has altered traditional means for marketing and campaign management. Understanding what drives consumption and shopping behavior is now key to maintaining and growing market share.


https://www.ibm.com/customer-engagement/commerce/merchandising-analytics



• Marketing resource management (MRM): Supports planning to determine strategic marketing channels, messages, and initiatives and to allocate appropriate budgets and resources. Execution of marketing activities involves managing timelines, costs, and internal and external resources to implement initiatives according to a marketing plan.

• Campaign management: Enables presenting personalized, timely, and relevant marketing messaging across multiple channels by using dynamic micro-segmentation with richer consumer data and sophisticated marketing analytics. Execution of an outbound marketing campaign involves:

• Defining and segmenting the target audience.

• Defining content and offers or messages for each segment.

• Sending out communications and tracking responses.

• Defining measurement strategy (control groups, A/B) testing.

Location awareness identifies where customers are at any moment in time. This feature is becoming even more critical in a retailer’s ability to personalize a campaign for its customers. By combining the use of mobile apps and also location-based services, campaigns can be truly personalized and their audience targeted very specifically with content that is relevant and in context of the customer’s situation.

• Real-time recommendations: A real-time recommendation engine is a centralized mechanism for selecting and prioritizing marketing offers, content, and products across interactive digital channels. Product, content, and recommendations about offers are based on the customer’s current shopping interests, search queries, wisdom of the crowd, predictive models, history of the visitor’s behavior, and data captured in the visitor’s profile.

IBM capabilities for marketing

IBM Watson Campaign Automation provides a platform for marketers to design and deliver unique

customer experiences across email, SMS, mobile push, social, and web channels with purpose-built

analytics and personalization capabilities. Its campaign management functionality supports single wave,

multi-wave, and triggered campaigns with powerful customer segmentation and automated A/B testing

delivered via email, SMS, and mobile push channels.

IBM Watson Campaign Automation enables retailers to:

• Develop budgets and plan marketing campaigns

• Design customers' multichannel journeys

• Execute stand-alone digital marketing tactics and automate triggered communication streams

• Use embedded analytics to better understand customer and prospects preferences and behaviors, to measure the effectiveness of marketing activities, and to make better decisions



IBM Watson Campaign Automation integrates with a number of popular CRM and lead management systems enabling your teams to more deeply understand your customers’ preferences and provide them with valued, relevant brand experiences. IBM Watson Real-Time Personalization helps digital marketers and merchandisers improve customer web and mobile experiences by offering the most relevant content and offers based on what your customer is trying to do in that moment. It makes real time decisions on which content to serve based on predictive models that understand the current intent and context that customer is in and what your goals are for the experience given where they are in their journey with your brand.

IBM Interact helps marketers enhance customer experiences by delivering relevant and personalized messages where and when the customer engages your brand. This powerful real-time interaction management solution uses current behavior, historical profile data, marketer defined rules and logic, and cognitive self-learning to provide the most relevant content during customer interactions. Marketers can achieve more meaningful customer interactions by orchestrating and automating personalized, omnichannel marketing strategies across inbound touchpoints, including websites, mobile, and call centers.

IBM Watson Marketing Insights uses cognitive technologies to help marketers more effectively target their customers based on detailed understanding of customer behavior and preferences. It recommends prioritized target audiences based on key predictors or lets you explore on your own, creating segments based on a rich profile of customer data compiled from multiple sources. It can also predict how your customers will likely migrate across your different segments over time as their preferences and behaviors change. You can export the resulting target audience lists to any requesting application across channels in just a few clicks.

Data services E-commerce is data driven. The key to proactive merchandising or faster response to market behaviors is visibility into events and habits combined with data related to the consumer’s day-to-day reality.

IBM capabilities for data services

IBM Cloud Platform as a Service includes multiple options to access, replicate, and synchronize data for cloud native and enterprise applications. Whether you are interested in using weather data to optimize logistics and inventory or in tools that will allow you to aggregate data more effectively, IBM Cloud offers services to help you accomplish these tasks quickly.

IBM Cloud offers the following services related to commerce:

• Insights for Twitter

• Weather Company Data

• Predictive Analytics

• Data Connect

• Db2 on Cloud

The Weather Company’s Watson Ads offers a cognitive engine to deliver data-driven, highly personalized

messages.

https://www.ibm.com/us-en/marketplace/real-time-personalization

https://www.ibm.com/us-en/marketplace/real-time-inbound-marketing

https://www.ibm.com/us-en/marketplace/predictive-customer-analytics-on-cloud

https://console.bluemix.net/catalog/services/weather-company-data?env_id=ibm:yp:us-south

https://console.bluemix.net/catalog/services/db2-on-cloud?env_id=ibm:yp:us-south


Universal Behavior Exchange (UBX) allows all the components of the cloud solution (and broader

ecosystem) to detect and publish events and audiences to be consumed and acted upon by other

components.

Business performance Enables describing and understanding the alerts, metrics, and key performance

indicators (KPIs) an organization uses to monitor day-to-day commerce activity, keep

track of progress against defined goals, and adjust offerings across commerce channels

in response to market demand. To facilitate this output of multiple systems is often combined in simple-

to-view dashboards that are tailored for a specific line of business or business role.

Commerce analytics and data services support highly granular and real-time visibility for overall customer activity, as well as the capability to drill down to individual transactions. Digital channels that combine multiple touch points, technologies, and platforms and the quest for optimal omnichannel retail has made it difficult to accurately measure a retailers’ business performance. While there are many more consumer touch points and interactions to measure, retailers still rely on some simple, fundamental metrics to provide an accurate view of their performance. These five areas are a common part of retail KPIs:

• Number of customers in a store or traffic to their website

• Conversion rates: Of the people who visit a store or website, how many make a purchase?

• Average sales value of items purchased

• The size of a shopping basket

• Gross margin

Transformation and connectivity The transformation and connectivity component enables secure connections to enterprise systems with the ability to filter, aggregate, modify, or reformat data as needed. Data transformation is often required when data doesn’t fit enterprise applications.


• Enterprise secure connectivity: Monitors usage and secures results as information is transferred to and from the cloud provider services domain into the enterprise network to enterprise applications and enterprise data.

• Transformations: Transform data between analytical systems and enterprise systems. Data is improved and augmented as it moves through the processing chain.

• Enterprise data connectivity: Enables analytics system components to connect securely to enterprise data.

• Extract transform and load: Helps in batch data load for digital catalog updates in B2B2C.


IBM capabilities for transformation and connectivity

IBM DataPower® Gateway is a multichannel gateway platform that secures, integrates, controls, and optimizes the delivery of workloads across multiple channels, including mobile, API, web, SOA, business to business (B2B), and cloud.

IBM Transformation Extender helps automate complex transformation and validation of data between a range of different formats and standards. The solution provides complex data processing capabilities for some of the most mission-critical applications in the world—from stock exchanges and pharmaceuticals to manufacturing, insurance, and global commerce.

IBM Sterling B2B Integrator helps you securely integrate complex B2B processes with your partner communities. It provides a single, flexible B2B gateway that enables your organization to meet a wide range of B2B integration needs.

IBM Cloud has the following transformation and connectivity services:

• The Secure Gateway service brings hybrid integration capability to your IBM Cloud environment. It provides secure connectivity from IBM Cloud to other applications and data sources running on-premises or in other clouds. A remote client is provided to enable secure connectivity.

Enterprise network components The enterprise network is where the on-premises systems and users are located.

Business user The business user has access to the commerce solutions on the enterprise network. If the business user is a merchant, supplier, or other third-party to the organization, their access might require VPN or some other secure, direct connection.

Internal channel Internal channel retailing solutions create an interactive experience whether the customer shops in the store, over the telephone with a customer service representative, or using a web-based call center. An internal channel uses the web to improve revenues and customer service in all channels. Key capabilities in this domain include:

• In store: Integrates the online channel with the store’s channel to offer the best of both channels and propel overall revenue growth. Retailers are working to differentiate themselves by delivering outstanding shopping choices and services in stores. By deploying innovative point-of-sale solutions, informational kiosks, web tablets, and wireless communications, they can gain a competitive advantage.

• Call center: Provides customer service representatives (CSRs) with a single point of access for a web-based call center solution that provides commerce information. It enables more informed omnichannel interactions with customers to help increase sales.

Enterprise application Enterprise applications are key data sources for a commerce solution. Enterprise applications use the cloud services and host the legacy applications. We have

https://www.ibm.com/us-en/marketplace/datapower-gateway


https://www.ibm.com/us-en/marketplace/b2b-gateway-software

https://console.bluemix.net/catalog/services/secure-gateway


described three key capabilities for e-commerce here but enterprise applications can include any other legacy applications. Key capabilities in this domain include:

• Finance: Supports financial systems that are an integral part of the overall e-commerce system. Whether a stand-alone application or a module within an enterprise resource planning application, the finance application is connected, at a minimum, to payment processing and distributed order management. Integrating this back-end system is a key requirement because it assures timely recognition of revenue and reconciliation of accounts and inventory.

• Human resources: Supports the workforce, including employees and contractors, in all aspects of human resources management such as hiring, training, safety, retaining, payroll, benefits, and more. Effective human resource management maximizes the benefits of work for both the workers and the organization concerned.

• Contract management: Supports the management of vendor and customer contracts for the enterprise. A typical contract on the “buy side” covers negotiated terms for procurement, pricing, assortment, inventory, logistics, orders with items, quantity and times, legal terms, measurements and enforcements with external vendors and suppliers who provide product and services to the commerce provider. The typical contract on the “sell side” covers negotiated terms for selling, pricing and promotions, assortment, inventory level, logistics terms, bulk orders, legal terms, measurements, and enforcements with B2B buying organizations that purchase from the enterprise. The contract management system is also responsible for federating portions of contracts to individual domain applications for contract execution and enforcements. This includes federating approved B2B catalogs with pricing and promotions to e-commerce sites, order management, and other channel providers, sending warehousing and logistics contract portions to the supply chain, warehouse management and logistics management solutions, and more. Contract systems also have a feedback mechanism to evaluate metrics and enforcement for contracts across domain applications.

IBM capabilities for enterprise applications

IBM offers a range of specific applications with capabilities suited to enterprise requirements, HR, and contract management. IBM does not have specific finance applications, but has integration capabilities with all the major finance solutions, including enterprise resource planning products.

IBM Kenexa offers a full line of HR SaaS products and services to help customers in various HR activities such as recruiting, onboarding, and engaging talent.

Enterprise data Enterprises host a number of applications that deliver critical business solutions along with supporting infrastructure like data storage. Such applications are key sources of data that can be extracted and integrated with services provided by the analytics cloud solution. Key capabilities in this domain include:

• Reference data: Master data information about products, locations, suppliers, customers, store associates, and employees. Master data management (MDM) provides a trusted view of critical entities typically stored and potentially duplicated in silos.

http://www-01.ibm.com/software/smarterworkforce/


Sometimes MDM is separated for customer data solutions and product data solutions. Master data management also helps to determine if a customer is an existing customer or new customer.

• Transactional data: Data from business interactions. This data describes how the business operates and includes transactional master data such as purchase orders (POs), advance shipping notice (ASN), sales order, shipment, receipts, and returns.

• Activity/Big data: Includes customer transaction history, web activity, ratings and review, social chatter, market data, weather and events, and contextual locations.

• Operation master data: Includes price, promotion, inventory, cost, carrier, digital content, and service providers. It will also have master digital catalog for the products.

IBM capabilities for enterprise data

IBM products, including IBM MDM, IBM Db2, HBase, BigInsights, FileNet, and Big SQL, are well suited to support the volume of enterprise data generated by commerce.

IBM Master Data Management solutions offer a simple, trusted view of your company’s data, including critical entities such as customer identity and product unique names. By offering a single, trusted view of critical entities that are typically stored or duplicated in siloed applications, IBM MDM solutions help you achieve customer-centric objectives and business results faster.

IBM Db2 is database software built for the digital, cloud, and cognitive era. It stores, analyzes, and retrieves data with extreme performance, flexibility, scalability, and reliability.

IBM BigInsights is a complete solution, including Spark, to help you quickly and easily scale analytics. It combines Hadoop and Spark to help you quickly process data. You can use BigInsights on-premises, on the cloud, or integrated with your current systems.

IBM FileNet Content Manager is a document management engine with enterprise content, security, and storage features, plus process management capabilities.

IBM Big SQL is a SQL engine for Hadoop that uses a single database connection to concurrently exploit Hive, HBase, and Spark. You can use Big SQL for data warehouse offload and consolidation.

Enterprise user directory Provides access to the user profiles for both the cloud users and the enterprise users. A user profile provides a login account and lists the resources (data sets, APIs, and other services) that the individual is authorized to access. The security services and edge services use this to drive access to the enterprise network, enterprise services, or enterprise-specific cloud provider services.

IBM capabilities for enterprise user directory

IBM Security Directory Suite is an IBM implementation of the Lightweight Directory Access Protocol (LDAP). This product serves as an enterprise directory for corporate intranets and the Internet.

Security Supports rigorous security needed at each step in the lifecycle of commerce application—from raw input sources to valuable insights to sharing of data among many users and application components. Security solutions helps detect, address, and prevent security breaches though integrated hardware and software solutions. Security services and products enable identity and access management, protection of data and

https://www.ibm.com/analytics/master-data-management

http://www.ibm.com/analytics/us/en/technology/db2/

http://www.ibm.com/analytics/us/en/technology/biginsights/

http://www-03.ibm.com/software/products/en/filecontmana

http://www.ibm.com/analytics/us/en/technology/big-sql/

https://www.ibm.com/us-en/marketplace/ibm-security-directory-suite


applications, and actionable security intelligence across cloud and enterprise environments. It uses the catalog and user directory to understand the location and classification of the data it is protecting.

Key capabilities in the security domain include:

• Identity and access management: Identify and monitor who needs access to sensitive data and systems in the e-commerce transaction. This capability uses an enterprise user directory to provide various access control mechanisms to commerce services, system, protocols, and social logins.

• Application and data protection: The following services support application and data protection:

o Data encryption: Secures the data interchange between components to achieve confidentiality and integrity by following standards such as payment card industry (PCI) compliance and data security standards (DSS).

o Infrastructure and network protection: Security alerts displayed through an integrated dashboard helps guard commerce solution components both clustered and non-clustered environments.

o Application security: Lists common attack types for Internet-facing applications. Analyzes open source systems, third-party applications, and libraries to share security vulnerabilities. Prevents illegal access into the system through Denial of Service and checks for cross-site scripting such as OWASP to protect the application before deploying into a production environment.

o Data activity monitoring: Tracks all submitted queries and maintains an audit trail for structured and unstructured dates.

o Data lineage: Describes what happens to data as it goes through diverse processes. Commerce applications offer visibility into the analytics pipeline and simplify tracing errors back to their sources. It enables replaying specific portions or inputs of the dataflow for regenerating the lost output to maintain the accuracy and compliance requirement.

• Security intelligence: The integrated security approach in commerce system event management provides security visibility on known e-commerce industry threats such as DOS, malicious code attacks, and data theft. It also shows accidental threats based on irregularities, like spikes in certain kind of hits on the site, spikes in hits from a specific area, or a large amount of data extraction to an interface that generally handles lower amounts of data. The security analytics suited in evolving threats in the industry standards are tracked and alerted.

• Data privacy: Describes the approach to handle and store sensitive personally identifiable information (PII). Capabilities enable customers to retain data sovereignty and residency to adhere to relevant regulatory requirements. In e-commerce domain, any information related to the customer name, address, telephone number, and email id falls in the category of PII, which can be used to uniquely identify, contact, or locate a single person.

o Data At Rest: Employs tokenization to replace the PII data with surrogate values to make data obfuscated in the event of data breaches. Transmitting, storing, and processing tokens in the cloud, instead of the original data, ensure sensitive information never leaves the organization’s domain and control.


▪ Define your PII: Gives the customer the decision-making power to choose what personal information is to be shared for advertising, marketing, and more, and which part of PII is not to be disclosed at all to anyone including a sub-processor of CSP (cloud service provider).

o Data In Motion: Uses data encryption to help organizations maintain control over their sensitive data when using cloud services. Cipher algorithm is used to transform the original data and re-transformed to the original value via the use of a key.

▪ Bring your Own Key: Asymmetric key encryption allows customers to get data encrypted in the conventional manner using public key but empowers them to bring their own key to decrypt the protected data to render it readable.

IBM capabilities for security

IBM’s Ten Essential Practices approach creates a comprehensive security posture for the enterprise across infrastructure, platforms, and solutions. IBM offers an assessment of the commerce application landscape in a workshop mode in tight collaboration with the enterprise security organizations. The following challenges are comprehensively covered as part of the assessment:

• Data security: Possible data breaches

• Privacy: Personal rights, trust

• Regulatory: Compliance requirements like PCI, FIPS, and others

• Fraud: Identity theft

The assessment helps you review the following areas in your e-commerce solution:

• Interface security: Ensure adequate security controls are considered while integrating the solutions to other systems in the environment.

• Data security: Database security controls to protect databases against compromises to their confidentiality, integrity.

• Point of Sale security: Determine gaps and vulnerabilities in customer checkout points.

• Security vulnerabilities arising out of third-party access to customer environments.

• Identity and access management.

• Application security.

• Mobile app security: Interact with security services to check authorization of users to perform application-specific tasks.

• Security intelligence and analytics: Analyzes logs and other data from the integrated systems and solutions, along with studying user activity, database activity, and network activity.

• Data archival and data destruction.

Refer to the IBM Cloud Architecture Center: Security architecture for additional details. IBM commerce solutions are hosted in a secured data center and operated in compliance with ISO-27002 standards. Transactions are operated with Data-in-Motion-Encryption (DIME) and Data-at-Rest-Encryption (DARE). The transactions do not store sensitive personal information (SPI) or PCI data. Tokens referencing the payments can be held within the IBM Digital Commerce service or the hosted environment.

https://www.ibm.com/security/services/security-essentials-and-maturity-consulting

https://www.ibm.com/cloud/garage/content/architecture/securityArchitecture


IBM QRadar® Incident Forensics allows you to retrace the step-by-step actions of a potential attacker, and quickly and easily conduct an in-depth forensics investigation of suspected malicious network security incidents.

The complete picture Figure 3 provides a more detailed architectural view of components, subcomponents, and relationships for a cloud-based e-commerce solution.

Figure 3: Detailed components diagram

IBM product support for e-commerce solutions in the cloud

Now that we've reviewed the component model for an e-commerce solution in the cloud, let's look at how you can use IBM products to implement e-commerce solutions. In previous sections, we highlighted IBM's end-to-end solution for deploying e-commerce solutions using cloud computing. In the next section, we show you how IBM capabilities map to specific components in the reference architecture.

https://www.ibm.com/us-en/marketplace/ibm-qradar-incident-forensics


The following scenarios take typical B2B and B2C use cases and show how IBM products are used to implement them following the reference architecture.

• Scenario 1. Digital transformation of retailer’s commerce enabled by cloud

• Scenario 2. Increasing customer engagement through personalization.

• Scenario 3. Digital transformation of retailer’s B2B commerce enabled by cloud

These scenarios reuse the components that the organization is currently using in their traditional data centers, which we depict as part of the enterprise zone of the architecture.

Scenario 1. Digital transformation of retailer’s commerce enabled by cloud A customer wants to buy new garments to attend a wedding in 4-5 weeks. He searches a specific retailer online. The retailer offers the merchandise both online and in retail stores in the mall. The retailer also maintains new designer clothes for special occasion. Figure 4 illustrates the flow of this typical scenario for the digital transformation of retailer’s commerce enabled by cloud.

Figure 4: Flow for the digital transformation of retailer’s commerce


1. The customer browses information about the needed garment using a mobile phone as a channel. The customer learns that a new design of the garment will be available in two weeks. The customer registers on the site to receive information about the availability of the new design. The customer’s presence on specific mobile pages and preferences entered as part of registration process are captured via the commerce analytics and marketing components. IBM Master Data Management captures the customer registration information in the enterprise data. IBM Digital Analytics captures the information about cookies and sites. IBM Universal Behavior Exchange (UBX) captures the customer’s behavior on the site.

2. A few days later, the retailer introduces the new design in their product catalog. The product is launched through a marketing campaign on various channels including an email campaign. The updated e-commerce catalogs are available for access on various channels. The merchandiser updates the catalog using IBM Digital Commerce (Catalog publishes on various channels).

3. The customer gets an email from the merchant about the new garment design. The customer opens the email and clicks on the link to go to the site and learn more about the product. Digital experience components, such as digital messaging, are used to engage the customer. The marketing tool uses MDM registration info and uses IBM Watson Campaign Automation to send an email to a targeted audience about new product.

4. Based on the customer profile, three variations of the product are shown on the site. When the customer appears on the site, marketing dynamic preferences are rendered using the customer’s preferences (captured in steps #1 and #3). IBM Watson Real-Time Personalization or IBM Interact can be used to provide personalized recommendations for the channel.

5. The customer uses a special promotion offered to him as a preferred customer. He earned this status based on his past purchases and the order capture component of e-commerce applications. IBM Digital Commerce helps to achieve this step.

6. The customer places his order (payment processing occurs) using the e-commerce applications. The specific customer order capture information is forwarded to distributed order management using IBM Order Management.

7. The merchant fulfills the order, ships it to the customer, and sends an email to the customer with tracking info. Distributed order management calls supply chain management to fulfill the captured order. IBM Order Management and IBM Watson Order Optimizer are used for order orchestration.

8. The merchant also checks the inventory to replenish from their contract supplier by using their warehouse management system.

9. The merchant sends out the appropriate purchase orders, drop ship requests, and service requests, and receives shipment notices, acknowledgements, and invoices. The supply chain and logistics management components enable these steps through use of IBM Watson Supply Chain Insights and IBM Supply Chain Business Network.

10. Information obtained from social analytics (including a survey from this customer) suggests that the new variation of the product is more popular than the original. The commerce analytics subcomponents social commerce and sentiment analytics are used for this purpose. IBM Watson Analytics for Social Media or IBM Watson Natural Language Understanding along with one of the natural language services from the IBM Watson Developer Cloud, simplifies social analytics.

11. Information obtained from social analytics is passed to merchandise inventory for further analytics and optimization. The merchandising is adjusted based on feedback from commerce analytics and warehouse management. IBM Watson Commerce Insights provides merchandise analytics and optimization.



https://www.ibm.com/us-en/marketplace/analytics-for-your-digital-properties


https://www.ibm.com/us-en/marketplace/customer-data-driven-marketing








https://www.ibm.com/us-en/marketplace/omni-channel-fulfillment

https://www.ibm.com/watson/supply-chain/solutions/supply-optimization/

https://www.ibm.com/watson/supply-chain/solutions/supply-optimization/

https://www.ibm.com/us-en/marketplace/partner-collaboration-network

https://www.ibm.com/in-en/marketplace/social-media-data-analysis

https://www.ibm.com/in-en/marketplace/social-media-data-analysis

https://www.ibm.com/watson/developer/

https://www.ibm.com/us-en/marketplace/watson-commerce-insights


Scenario 2. Increasing customer engagement through personalization.

Greenwheels is a company that sells bicycles and related clothing and accessories. The company provides a cross-channel shopping experience that combines products, content, and marketing offers organized by equipment category. The company wants to increase customer engagement and conversion rates in its digital channels by personalizing the visitor experience based on a visitor’s skill level. The challenge is that skill level data is not currently available. Greenwheels will use the capabilities of IBM Watson Marketing to collect the data, personalize communications, and better target content and marketing offers.

Runtime flow

Data collection

1. Products in the Greenwheels product catalog are tagged with appropriate skill level values. IBM Digital Commerce is used to add additional metadata tags in the product catalog.

2. Content items in the Greenwheels content management system are tagged with skill level values. The website and mobile account management are modified to allow registered customers to specify their skill level. IBM Watson Content Hub, IBM Digital Experience, and IBM Web Content Manager are used to manage metadata tag for content items.



https://www.ibm.com/products/watson-content-hub

http://www-03.ibm.com/software/products/en/category/digital-experience

https://www.ibm.com/us-en/marketplace/web-content-development

https://www.ibm.com/us-en/marketplace/web-content-development


3. Marketing offers are created to appeal to visitors with specific skill levels. IBM Campaign is used to manage the offers.

4. Email communications are designed to contain a mix of content appropriate for various skill levels. IBM Watson Campaign Automation is used to define email templates and content personalization rules.

5. Greenwheels configures IBM Digital Analytics to track the skill level attribute as the customer opens email links, searches, and navigates the website and mobile app. Customer behaviors are published by IBM Digital Analytics and consumed by Watson Campaign Automation and IBM Campaign.

Personalization setup

6. The skill level data from customer profiles, marketing offer responses, IBM Digital Analytics, and placed orders are collected in a customer data mart, which is part of enterprise data (IBM Db2 BLU, Hadoop, or Netezza appliance).

7. IBM SPSS develops predictive models to estimate skill levels for new visitors and customers with insufficient or conflicting data.

8. Product, content, and marketing offer personalization rules and are configured to match and rank items based on available skill level values. Personalization rules are deployed to Greenwheels website and mobile app. (You can use IBM Watson Real-Time Personalization, a component of Watson Campaign Automation, or IBM Interact, for this step.)

9. You can redesign Watson Campaign Automation email templates so that personalization rules select content and offers relevant to a recipient’s skill level.

Customer experience

10. The customer receives an email featuring relevant equipment and articles according to his or her skill level.

11. The customer clicks on an email link and opens an article on the Greenwheels website. The customer reads the article, finds it interesting, and decides to explore the topic in more details.

12. The customer enters a search phrase into a search box powered by IBM Watson Conversation Agent.

13. IBM Watson Real-Time Personalization or IBM Interact personalization rules are applied to content and product search results. Search results are filtered and sorted based on their relevance to the search criteria and the customer’s skill level. Relevant marketing offers are displayed on the page.

14. The customer sees a smaller, more relevant list of content items, products, and marketing offers, decides to make a purchase, selects an item from the list, and places an order. IBM Order Management is used.

Ongoing improvement

15. Business users look for additional attributes to improve personalization and provide more engaging customer experience. IBM Digital Analytics, customer analytics, IBM Commerce Insights

and Journey designer can be used.

https://www.ibm.com/us-en/marketplace/omni-channel-campaign-management








https://www.ibm.com/watson/services/conversation/

https://www.ibm.com/watson/services/conversation/





https://www.ibm.com/customer-engagement/commerce/merchandising-analytics


Scenario 3. Digital transformation of retailer’s B2B commerce enabled by cloud A multi-brand apparel retailer is buying new stock to refresh its stores for the fall season. The retailer has a relationship with a major apparel brand and has a contract in place to buy the fall collection from the brand. The contract specifies the terms and conditions of the purchase, how many items the retailer will buy, and any co-branding arrangements that are required to deliver the stock to the retailer's stores across the country. The multi-brand retailer creates purchase orders to the apparel brand’s company well in advance to assure the products are delivered per contract before the fall selling season. For this scenario, IBM offers end-to-end and specific use software depending on the customer’s existing investment. IBM Blockchain platform and API are used to record transactions such as the order, shipment, invoice, receipt, and payment to make use of the distributed ledger and to provide a single view of truth to interacting parties such as the buyer, seller, and carrier.

1. Contract setup: A term contract is negotiated between the brand owner and the multi-brand retailer. The contract is approved and is stored for execution in the company’s contract management system. The contract management system federates the appropriate contract portions to relevant commerce systems to execute the contract. For instance, the approved catalog



with pricing and promotional setup is sent to the e-commerce application. The order validation rules, inventory promising rules, and fulfillment optimization rules are sent to distributed order management. The warehousing rules related to packing, labeling, printing, and other value-added services are sent to the warehouse management systems. The logistics and transportation-related contract rules are sent to supply chain and logistics applications.

2. Browse: The multi-brand retailer’s buyer browses the products from the fall catalog selection on the brand’s B2B site. The B2B site shows the fall catalog collection along with product details and pricing information based on the contracted catalog and the prices negotiated as part of the contract. IBM Master Data Management on Cloud federates the contracted catalog items along with pricing terms for buyers to IBM Digital Commerce or WebSphere Commerce. The search engine on IBM Digital Commerce or WebSphere Commerce enables the buyer to search for the products under the catalog using various search contexts, including cognitive searches in natural language.

3. Shop/Purchase: The buyer makes the selection of products to be purchased and adds delivery instructions. The buyer creates the order and submits it with a corporate payment (accounts receivable) configured with the financial systems. The e-commerce system validates the order to ensure that it is valid per the defined contract. The e-commerce order is submitted to the distributed order management for order orchestration and execution. IBM Digital Experience on Cloud manages the context and shopping experience for the buyer. As the buyer adds the products to his shopping cart, the shopping cart is actively managed in IBM Digital Commerce and WebSphere Commerce, which calculates the order totals, applicable taxes, delivery terms, and more, based on the contractual agreements.

4. Orchestrate: The distributed order management manages the order and applies the contract terms for order management relevant to inventory availability, priorities, delivery terms, shipping locations, and schedules and creates one or multiple shipments. The shipments are sent to the warehouse management system for shipment execution at one or more physical warehouse locations. IBM Order Management reviews the global inventory availability, delivery terms, and supply chain constraints and then validates, orchestrates, sequences, and schedules the order. IBM Order Management integrates with fulfillment systems for shipment management and execution from the warehouses.

5. Fulfill: 5a) The warehouse management system waves the shipments it receives, applying optimizations relevant to fulfillment. The shipments are picked, packed, and staged for carrier pickup through transportation and logistics. Orders dropped by order management are converted to shipments, and processes like picking and packing are performed and managed as end-to-end processes. 5b) The warehouse management systems interact closely with the supply chain and logistics management systems to manage the shipment packages, shipment loads, or both. Warehouse management system integrates with transportation logistics management systems such as BluJay Solutions (formerly IBM Transportation Management System) to manage the logistics and distribution of shipments through the supply chain to the customer. IBM Watson Supply Chain Insights can give complete visibility on supply chain movements of shipments.

6. Notify: The shipment notifications are sent back to distributed order management, which then communicates to the retailer systems by sending them advanced shipping notifications (ASNs) through IBM Sterling B2B Integrator. This allows the retailer systems to enable receiving the shipments as per the contract with the brand apparel provider. Optionally, these notifications can also be recorded through blockchain-based distributed transaction management systems. When shipments are shipped from the warehouse, the warehouse management system notifies IBM Order Management about the shipment, thereby resulting in relevant order status updates. IBM



http://www-03.ibm.com/software/products/en/websphere-commerce


http://www-03.ibm.com/software/products/en/websphere-commerce

http://www-03.ibm.com/software/products/en/order-management



https://www.blujaysolutions.com/








Order Management transmits the consolidated notifications through IBM Sterling B2B Integrator that will eventually notify the customer’s systems to ensure transactions are recorded for further processing. Due to the disparate nature of transactions, it is quite possible to end up with discrepancies on either side, resulting in an expensive reconciliation after the fact. Distributed ledger platforms and smart contracts using the IBM Blockchain API help ensure a systemic global reconciliation, thereby accelerating payments and reducing expensive audits and litigations due to transactional discrepancies.

7. Invoice: Appropriate invoices are sent to the retailer through the company’s financial systems through accounts receivable as per payment and settlement terms in the contract. IBM Transformation Extender transforms the data into the format accepted by the retailer’s accounts payable system. This entire supply chain business process automation is orchestrated by IBM Sterling B2B Integrator. Optionally, these notifications can also be recorded through blockchain-based distributed transaction management systems. IBM Blockchain APIs and platforms can provide a mechanism for recording invoices that transmit within the participant network in a matter of minutes.

8. Reconcile: 8a) The retailer notifies the brand about the receipt of shipments and its financial systems send out reconciliation or adjustments as per the negotiated contract and invoices received. The business process automation using IBM Sterling B2B Integrator enables the retailer to exchange reconciliation and invoice documents without any human intervention. 8b) Settlement transactions are created and payment issued after this reconciliation stem. The use of blockchain-based distributed transaction systems can greatly simplify the reconciliation cost, time, and effort. IBM Blockchain APIs and platforms can provide a mechanism for distributed invoices and significantly reduce payment reconciliation and settlement times by recording all these transactions in a global distributed ledger with immutable transactional properties, thereby improving overall cash flows and efficiencies for the provider and the buyer.

Deployment considerations Deployment considerations need to start with the capture and confirmation of the business capabilities required for the enterprise. Usage scenarios, the ability to analyze data across channels and systems, and to act on it all guide the choice of as-a-service options. The e-commerce architecture presented in Figure 2 is applicable across industries: banking, retail, manufacturing, communications, industrial products, and others. Any enterprise needs to consider existing investments and their own organizational maturity when making deployment decisions. Merchants, who must adapt quickly to the marketplace, will find cloud services to be a more responsive foundation for innovation and real-time analytics. IBM can provide industry-specific expertise to help guide the organization through a transformation discussion and help identify where adoption of cloud services can make the most impact. The IBM Cloud platform and cloud unit deliver offerings that fall within the two standard cloud computing models: service type and deployment type. If you are not familiar with the definitions and desire prescriptive information on how to choose between types, the CSCC’s Practical Guide to Cloud Computing [7] is a good place to begin your decision process. Enterprises in retail and distribution frequently have a significant investment in on-premises systems, particularly for warehouse and inventory management. Most merchants engaged in online sales will use a third party for their payment gateway and payment processing. Since e-commerce solutions are most frequently built on a hybrid architecture, the CSCC’s Practical Guide to Hybrid Cloud Computing [8] can help you navigate the











http://www.cloud-council.org/deliverables/CSCC-Practical-Guide-to-Cloud-Computing.pdf


http://www.cloud-council.org/deliverables/CSCC-Practical-Guide-to-Hybrid-Cloud-Computing.pdf


intricacies of hybrid planning and governance. Once governance and deployment guidelines are set, IBM Cloud Brokerage as-a-service allows you to take those policies and use them to plan, buy, and manage (that is, to broker) software and cloud services from multiple suppliers across hybrid clouds from a single screen. The IBM Cloud point of view is to offer choice with consistency. This gives you the ability to extend an existing investment via a range of cloud services, to position environments for development and testing in public, dedicated, or local spaces, and to gain elasticity by using off-premises systems that mirror their on-premises’ counterparts, while having visibility across the entire architecture. The ability to choose enterprise class Software as a Service is a boon to start-ups.

Among the IBM hybrid offerings frequently adopted for e-commerce use are:

• IBM Cloud platform (PaaS and IaaS)

• IBM Cloud Private

• IBM Cloud Object Storage

• IBM Cloud Dedicated on OpenStack

• IBM WebSphere Application Server and Middleware

• IBM DataPower

Whether or not a commerce architecture component is available across cloud adoption patterns and on-premises will also dictate the choice and use of a public, private, or hybrid cloud. The CSCC papers referenced at the beginning of the deployment section and in the references section offer guidance on SLAs as well as considerations for resiliency and interoperability. Guidance on how to define cloud governance for public, private, and hybrid architecture is also provided. The decomposition of monolithic enterprise systems into microservices for simplified creation of cloud native and mobile apps is a frequent concern for the organization looking to rapidly modernize and better engage with consumers. IBM Cloud Private allows organizations to keep certain information or services behind their firewall while still having all the benefits of cloud delivery and consumption models. IBM Garage Method Architecture Center offers guidance on using IBM Cloud Private and microservices. Customer security concerns are universal. Whether a commerce application is B2C or B2B, users need to have confidence that their personal data and payment information is secure and their privacy is maintained. The cost and effort to implement PCI or data security compliance frameworks will guide decisions on what cloud type and services to adopt. To reduce complexity, organizations will likely prefer "full-service" providers of payment services and gateways rather than piecing together multiple providers. Organizations that are start-ups or have very little investments in e-commerce may choose to use public or dedicated off-premises cloud environments to realize infrastructure components in support of self-managed commerce architecture components. Further, they have the option to use standardized SaaS commerce components. Organizations that have made investments in on-premises systems, such as ERPs, billing management, or warehouse and inventory management, have a different set of opportunities for their architecture. When

http://www-03.ibm.com/software/products/sl/cloudbrokerage

http://www-03.ibm.com/software/products/sl/cloudbrokerage

https://www.ibm.com/cloud-computing/products/ibm-cloud-private/

https://www.ibm.com/cloud-computing/products/ibm-cloud-private/

https://www.ibm.com/cloud/garage/content/architecture/private-cloud

https://www.ibm.com/cloud/garage/content/architecture/microservices


adding new components, they have choices such as using a standardized public cloud commerce SaaS offering or using dedicated off-premises cloud solutions to support capacity bursts. IBM Cloud platform supports this kind of hybrid approach with flexible and interoperable services. Any organization needs to make regular assessments of both their technology and development processes that support e-commerce to assure that these meet the business needs of agility and innovation. When there are needs for improvement, a decision can be made to move into either a private or public cloud component. Organizations that have made heavy investments in on-premises commerce assets, yet find their SLAs are not met by current public or dedicated cloud capabilities provided by CSP vendors, would likely benefit from a hybrid cloud adoption pattern.

Once you’ve decided on a cloud pattern (hybrid, public, or other), a final review of all system integration points is essential. You should give thoughtful analysis to harmonizing SLAs, assuring end-to-end change notification, and updating security policies. Integration points are also a potential area of bottlenecks. Assure that middleware, API appliances, PaaS, service busses, and more are capable of meeting peak usage. Continual transaction monitoring of integration points, from both a security and performance perspective, is highly desirable. IBM offers performance and availability monitoring backed into IBM Cloud, as SaaS (IBM APM) and on-premises solutions.

Summary of key considerations The architect of an e-commerce system needs to match the requirements of business tools and technologies capable of satisfying customers, merchants, compliance entities, and financial services providers. The ubiquitous nature of social media as a vehicle for criticism means that an unsatisfactory experience for any one of these constituents could turn into a viral, real-time public relations problem. Cloud services such as SaaS and PaaS are typical approaches to meeting the requirements of rapid updates. Cloud elasticity and resilience assure unanticipated bursts in traffic can be supported. The following are key considerations for architects aiming for an optimal user experience across all e-commerce channels:

• Design to meet needs for rapid change and updates in customer-facing components.

• Assure high performance across all components.

• Carefully analyze system interfaces and dependencies.

• Assure future interoperability by choosing open standards-based components wherever possible.

• Make data security a focal point across the architecture.

Conclusion This paper offers a deeper understanding of the CSCC Cloud Customer Reference Architecture for e-commerce and discusses how IBM products and solutions support the key capabilities required to implement and operationalize the reference architecture. These capabilities include e-commerce order capture, fulfillment, digital marketing, procurement, sourcing, data communications, social analytics, digital analytics, and cognitive solutions. The solutions discussed in this paper have been deployed at many customers all over the world and are implemented based on open standards. This paper also offers practical guidance in the form of deployment options and use case scenarios based on actual IBM customer implementations. IBM has the expertise, experience, and products you need to build a world-class e-commerce system built on the cloud that can scale to meet future demands and changing industry trends.


Acknowledgements

The major contributors to this white paper, listed in alphabetical order, are Gautham Acharya, Bob Balfe, Bharat Balothia, Glen Daly, Sunil Dube, Bob Flaherty, Mark Griner, Gopal Indurkhya, Karl Kama, Heather Kreger, N. Krishnan (Kitty), Vikram Malhotra, Raghuveer Nagar, Leho Nigul, Rob Parkin, Anbu Ponniah, Siddarth Rao, Sudhanshu Sar, Karolyn Schalk, Raj Subramanian, Vince Tkac, and Michael Yesudas.

References

[1] Cloud Standards Customer Council, Cloud Customer Architecture for e-Commerce

[2] How IBM leads in building web application hosting cloud solutions

[3] How IBM leads building mobile cloud solutions: Implementing the CSCC Customer Cloud Architecture for Mobile

[4] How IBM leads in building big data analytics solutions in the cloud

[5] The IBM Advantage for Implementing the CSCC Cloud Customer Reference Architecture for Internet of

Things (IoT)

[6] Cloud Standards Customer Council, Cloud Customer Architecture for IoT

[7] Cloud Standards Customer Council, Practical Guide to Cloud Computing

[8] Cloud Standards Customer Council, Practical Guide to Hybrid Cloud Computing


https://www.ibm.com/developerworks/cloud/library/cl-ibm-leads-building-web-app-hosting-cloud-solutions-trs/index.html






http://www.cloud-council.org/deliverables/CSCC-Cloud-Customer-Architecture-for-IoT.pdf



http://www.cloud-council.org/deliverables/CSCC-Practical-Guide-to-Hybrid-Cloud-Computing.pdf

Documents

The IBM Advantage for implementing the CSCC Cloud … application ... Increasing customer engagement through personalization. ... B2B or B2C commerce for the sales of the product,