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"This is about our customers and the future viability of engelhorn"

20 March 2024

How engelhorn has created an integrated system landscape for the benefit of customers and the team. Interview with Katrin Schäfers, Head of e-Commerce Technology at engelhorn.

"Everything we do is guided by our passion, style and courage, and has been for more than 130 years." This motto testifies to engelhorn’s business philosophy, which always places the customer at the center of its activities. Given this focus, it makes perfect sense that the Mannheim-based fashion retailer pays special attention to customer service. This is all the more important today as the large number of engelhorn's sales channels and the highly fragmented technological landscape make customer-centric daily work more difficult.

Katrin Schäfers has been Head of e-Commerce Technology at engelhorn since August 2023. Together with her team, she has created a standardized database. The cornerstone of this new system: a consolidated dataset – known as a golden record – in the product area of the PIM system. This project was implemented in collaboration with the D&A specialist Parsionate. The new system was set up to provide best-in-class assistance to customers who have questions or concerns, regardless of how they reach out to the company. Katrin Schäfer's motto for the project: "Let’s create the future-proof data strategy of tomorrow together!" In our interview, she explains what this means in practice and why it benefits everyone: the company, the team, and the customers.

What challenges did engelhorn identify at the beginning of the project?

Katrin Schäfers: When we started our Customer Suite project in 2022, our main challenge was to fundamentally improve data access for our customer service. We wanted to make sure that the customer service team is about to respond swiftly to customer inquiries and provide great value, whether people reach out by phone or email. This requires quick and easy access to all the relevant information. Previously, however, the team had to jump through quite a few hoops to gather this information from a variety of systems, including the order management system and the shopping systems of our online store and marketplaces. Even product data was scattered across multiple platforms. What was missing was an integrated system that gave customer service representatives direct access to all the information they needed.

What were your wishes and requirements at the beginning of the project?

Schäfers: We started with the primary goal of consolidating the scattered data and integrating it into a higher-level customer service system. Customer service needed a central data access point. We also wanted to emphasize the importance of our customer service, both internally and externally. Customer service is often the first touchpoint for our customers. If they receive inadequate or delayed responses to their inquiries, their customer experience is significantly impacted, which in turn negatively affects our conversion rate. This is why we made it a top priority to improve the customer experience in a sustainable way and to deliver tangible value to our customers.

What were your requirements for the tools and systems?

Schäfers: It was important to us that we could integrate the entire engelhorn product portfolio into the systems without any negative impact on usability. We decided not to introduce a new PIM system, but instead to build on our existing PIM solution, Product 360 from Informatica. The data volume would increase, but the process and system stability had to remain at the same level.

What were the specific process steps?

Schäfers: I wasn't involved in the project right from the very beginning, although I was very familiar with the challenges from my previous role as a team leader in store development. Initially, we did not focus on the PIM system. The first challenge was to transfer the customer data from the store systems to the BSI system for customer service. This first step was already a significant improvement for our team. Next, we integrated the product information. Previously, our PIM was used exclusively for online data, including all relevant product information for our own store and the marketplaces. This data was previously merged with partner data, but the shared master was online-only. Since customer service also receives inquiries about products available in our physical stores, we needed to integrate all this information into our system as well.

What problems did this cause?

Schäfers: In addition to extending the PIM system to include product data from the retail locations, a major challenge was to restructure the entire data flow accordingly. We used to have pre-defined exclusions, so that physical store data and incomplete product data were filtered out during export and not even transferred to the PIM system. The redesign literally took away all boundaries: Now all product data, whether for retail locations or online stores, is entered into the PIM. This is three times as much data as before, all of which had to be processed and transferred correctly in the system. We had to make sure that products that are sold in retail locations but not online were not mistakenly included in the export for the online store, creating a whole new set of challenges for the team.

"Greater openness to new technologies and innovation"

How does the project fit into your overall data and IT strategy?

Schäfers: This project is central to our data and IT strategy because it concerns our customers and the future viability of our business. In the past, each department used its own system, resulting in a fragmented landscape with many small islands of data. It meant that there was not enough data sharing, which is vital for the entire company. This is especially true when it comes to the big picture of data and data flows. Our project was the first at engelhorn to create an integrated data pool from a variety of systems. The process is not yet complete and will require further work. But it is a big step in the right direction.

Has the project had an effect on the corporate culture and the team?

Schäfers: Absolutely. The way we look at data, what it means and how it is processed is changing fundamentally. This is no small thing in a company like engelhorn, which is more than a century old and where many structures and processes have evolved over a long period of time. It takes a lot of explanation and guidance to change the general mindset and break down historical boundaries, which includes learning more about the needs of other departments. The project has strengthened our internal communication and created a greater openness to new technologies and innovation.

What specific positive effects do you see?

Schäfers: A lot of things used to be done manually and took a lot of time, including status processing, which is the approval of process steps. This task is now largely automated, allowing us to reduce time-to-market. The data flow has also been optimized. As a result, we have been able to save costs. One example: Thanks to the shorter time-to-market, we were able to reduce the capital tied up in non-sellable items by 320 percent, from 800,000 euros to 250,000 euros.

How has data consistency and integrity improved?

Schäfers: Integrating the product data from the physical locations, which tripled the total data volume, presented significant challenges. Fortunately, we were able to overcome these in close cooperation with our partner Parsionate. Despite the increased data volume, we were able to keep processing times stable and establish a so-called ‘golden record’. This term refers to a system that integrates all product data from different sources into a standardized product master in the PIM system. The new setup allows us to update data more flexibly and quickly and, if necessary, add it to the PIM and process it as we go. This increased flexibility and efficiency in data processing has significantly improved our ability to respond to market changes. Ultimately, the consolidation of relevant data from retail locations and e-commerce and the creation of a golden record in the product area has increased data consistency and integrity.

Where do compliance and security come in?

Schäfers: We are not allowed to share the data we receive from various systems without restrictions. For example, we are not allowed to use product data that we receive from partners for advertising purposes on marketplaces such as Amazon. So the origin of the product data is very important. One way to ensure compliance is to use the source of the product text to determine whether the content is owned by us or by a partner.

What has changed for customers?

Schäfers: We are able to respond more quickly and provide more value. Because customer service can now access a centralized system with a single product master, our Product Golden Record, representatives no longer have to search for information in different systems. This makes the work in customer service much easier and improves the actual customer service. Customer inquiries about product availability, whether at our retail locations or in the online store, can now be answered more quickly and accurately, ultimately leading to a better customer experience.

"The quality and relevance of the tools are the key"

What is the current project status?

Schäfers: From an e-commerce perspective, the customer service project is technically complete. However, the expansion of the BSI Customer Suite is still ongoing. The next steps include modernizing the checkout system in our physical stores and expanding the functions of the engelhorn customer card in the online store.

Looking back, what are your lessons learned?

Schäfers: It would have helped to describe the requirements in more detail at the beginning and to sketch the big picture once. This makes the work easier for the project team, especially for people who join as the project is already underway. Problems and challenges that are identified later in the project often require more effort and cost more time and money to resolve.

What should a modern technology stack look like today?

Schäfers: In my opinion, the choice of specific systems is secondary to the overarching goal of creating an outstanding customer experience. The focus should be on the customer-centricity of the systems. This which means it’s not about quantity; the quality and relevance of the tools are the key. This is especially true for AI applications.

To conclude, let's talk about the crisis-ridden past few years: How did things go for engelhorn?

Schäfers: The company has never closed its retail locations before, not even during the Second World War, which has always been a point of pride. Unfortunately, we were not able to maintain this continuity during the pandemic, which particularly affected our physical stores. However, we were able to compensate for some of their lost sales with our online business. E-commerce grew during that period, but it has since slowed down. So we are now more or less back to pre-pandemic levels. This means that we have to focus more than ever on operational excellence and prudent planning.

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