The Next Step to Unified Channels

By Matthew Hicks  |  Posted 2001-03-05

Building co-branded sites that allow manufacturers to control how product information is presented online by their retailers and distributors is becoming increasingly common. But, experts say, manufacturers shouldnt stop there. Doing so would be like writing a book with only a splashy cover. Its whats behind the cover that really matters.

For many manufacturers, the next step in channel management will be to integrate between their own back-end systems, such as ERP (enterprise resource planning), and the Web sites that channel partners use to sell to consumers. That way, for example, an order placed on an online retailers site can flow directly into a manufacturers ordering system without a reentry by the channel partner.

Manufacturers such as Miller Electric Manufacturing Co. and DaimlerChrysler Corp. are working with channel partners on just that kind of integration to make ordering and fulfillment processes as seamless as possible. Channel management software vendors increasingly are supporting integration between their applications and services and standard ERP systems from such companies as SAP AG and PeopleSoft Inc., as well as order management systems from such vendors as SpaceWorks Inc. Such vendor initiatives will fill some, though not all, of the integration gaps. Thats because many manufacturers still rely on home-grown or outdated back-end systems for order management, and vendors wont build direct links to those systems. So many manufacturers seeking integration between their back-end systems and online channel partners will have to turn to custom integration.

Miller is working with InfoNow Corp. to build integration between InfoNows co-branded Web site service and Millers ERP system. Currently, even though the InfoNow service allows Miller to control what consumers can see and buy on distributors sites, when distributors receive a Web order they still must fax it to Miller, said Tim DeMars, senior vice president of marketing at the company, in Appleton, Wis. That can slow the process.

Miller expects to finish tying a closer knot with the co-branded sites by April.

There are limits, of course, to how much information manufacturers and channel partners can usefully share. And not all of the limitations are because of technology. In some cases they have more to do with well-established business relationships. DaimlerChryslers dealers, for example, while buying into the manufacturers co-branding initiative, largely arent providing real-time pricing for vehicles on their sites and instead require consumers to request a quote, said Tom Peyton, senior manager of e-commerce at DaimlerChrysler, in Auburn Hills, Mich. Part of the reason is tradition: Buying a car traditionally has involved haggling with a dealer. That could be undermined if dealers posted real prices.

As manufacturers and their channel partners continue to work more closely together online, theyll learn more about what information is useful and what isnt, Peyton said.

"Its an area that needs more study," Peyton said. "Its a little bit of taking a step at a time."

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