Unified Commerce Payments vs. Integrated Systems: Which Is Best for Retailers?

Monos—a digital native, minimalist luggage brand—was ready to make the next big leap in their company’s history, but they had a problem: Opening retail stores had just as much potential to fragment their brand as it did to expand it. 

"We knew there could be data conflicts and differences in the customer experience online and offline," said Mike Wu, director of ecommerce and customer experience at Monos. “Customers today expect the ability to do things like in-store returns for online purchases, and associates need easy access to a customer's full purchase history,” said Anita Yeh, Monos’ director of retail operations.

Monos made an early but foundational decision to use Shopify POS so that they could take a unified commerce approach to payments from the very beginning. 

Not every brand has the chance to make the same early decision. When you already have physical storefronts, an ecommerce platform, and a broad web of tools connecting everything together, it’s easy to assume that once you add enough tools and features, your payments system is more or less unified. The truth, however, is more nuanced. 

What is unified commerce?

Unified commerce is a business strategy brands use to offer customers incredible shopping experiences across a range of channels—all supported by software built on a singular, cohesive codebase. The goal is to know customers as well as possible and deliver the consistent, recognizable, personalized experiences they have come to expect. 

At first glance, a unified commerce strategy may seem synonymous with an omnichannel approach, but the two are distinct. Some vendors claim, for example, that all you need to do to achieve unification is to provide omnichannel selling. Others claim that you can reach unification just by adding and integrating more and more channels over time. 

Neither achieves the promise of unification, because a unified strategy doesn’t begin and end with omnichannel selling—omnichannel isn’t even the end goal of unified commerce. 

A unified commerce strategy is much more ambitious because unification is a first principle, not a series of add-ons stuck on over time. Every feature from the front end to the back end is designed to work together, and customers benefit from an experience that’s high quality at every touchpoint. Omnichannel selling is just one result of this strategy. 

What are integrated systems?

An integrated system is a collection of separate systems that brands connect through middleware or APIs. Data is not unified—instead, APIs pass data back and forth among these systems and components, leading to latency at best and inconsistencies at worst. 

Customers' demands have risen and expanded over the years, especially when it comes to wanting similarly great experiences across physical and online storefronts. However, as brands added one capability after the next, many have kept up and fallen behind. Eventually, a brand can end up with a patchwork system that seems to check many boxes but can’t function seamlessly. 

Unified commerce vs. integrated systems: Four differences in how they handle payments

Unified commerce systems enable brands to provide a seamless payment experience across all channels. Integrated systems struggle to do the same, and frequently create friction where brands most need efficiency. 

Customer experience

A unified commerce system provides a seamless, consistent payment experience across all channels. Customers can use the same payment methods online and in-store, and their payment information can be stored in a single, secure location.

Using an integrated system often results in a disjointed payment experience. Customers might need to use different payment methods on different channels, which creates unnecessary friction. 

At Aviator Nation, for example, the brand lacked a unified system for managing inventory and transactions across their website and 18 store locations. “For years, there was a disconnect between our online business and our retail business,” says Curtis Ulrich, director of ecommerce at Aviator Nation. 

With a unified approach, Aviator Nation was able to provide a better experience without sacrifice. “Unifying our in-store and online sales with Shopify streamlined our operations and made it so much easier to gather the data we needed to provide our customers with exceptional experiences,” says Curtis.

Data management

A unified commerce platform centralizes all payment data into a single, coherent system, which gives retailers a holistic view of their business and their users. Brands can use this data to improve marketing, personalize customer experiences, and optimize operations. And as brands evolve and add capabilities, a unified system makes it easy to iterate.

Integrated systems often involve disparate, separate systems connected by API or middleware. As a result, payment data is frequently stored across multiple systems, which makes it difficult for brands to get a complete picture of the business at any given moment. As time goes on, this leads to fragmented data, operational inefficiencies, and a disjointed customer experience. 

At Monos, for example, the company was wary that the shift from digital to physical could introduce friction. The brand points to Shopify’s inventory management capabilities as a particular game-changer. 

"When our online team is servicing a guest browsing the website, they can see the inventory available in a local store and hold it there for the customer to pick up that same day so they don't have to wait,” says Anita Yeh. “Or if a retail associate is helping a customer find an out-of-stock item, they can see where we have it in a warehouse and get it shipped to them before their upcoming vacation."

Cost

A unified commerce platform reduces costs by eliminating the need for middleware, API management, and third-party integrations. Plus, with solutions like Shopify Payments, brands can streamline payment processing, making payments much more efficient. 

Integrated systems tend to be more expensive than unified systems because they require ongoing maintenance and integration costs. Every time brands want to add a new capability to an integrated system, they have to integrate a new component. In the short term, this work tends to need developer resources, and in the long term, developers often return again and again to maintain the integration.

At Konditor, for example, the team struggled with their ecommerce platform, Magento (now Adobe Commerce), and a separate POS provider, Tevalis. Costs were rising, and the brand saw an opportunity to migrate, unify, and save. 

“We needed to get the right tech stack, the right tools, and the right experience for customers—and do it at a sustainable cost for the business,” says Tom Rundell, online operations manager at Konditor. “We could see there was an opportunity with Shopify to have both online and our in-store sales on the same platform.” As a result of this unified approach, Konditor reduced costs by 13% and spent 50% less time on administrative tasks.

Efficiency

A unified commerce platform streamlines operations by automating payment processes and providing real-time visibility into payment data. This level of efficiency pays off more and more over time, especially as brands expand into different channels. 

Integrated systems tend to be inefficient because the systems are, by nature, disconnected—requiring brands to maintain those connections and reconcile data across systems. Inevitably, manual work is necessary. 

The internal team at Bobo Choses, for example, once spent the vast majority of their time fixing incidents with discounts and promotions, or recovering from crashes or latency. Efficiency improved once the brand migrated to Shopify. 

“We have gone from spending 80% of our time fixing technical incidents to a number closer to 10%,” says Saül Aleu, chief technology officer at Bobo Choses. Even better? The brand can now reinvest all the resources they saved. “And the time we used to devote to solving technical issues, we now use to add value to the business," Saül says. 

Five benefits of unified commerce payments

The benefits of unified commerce payments extend across every channel a customer interacts with, and to every component a brand uses. 

1. Improved customer experience: A seamless payment experience across all channels can increase customer satisfaction and loyalty, allowing brands to meet and even exceed customers’ expectations. 
2. Better insights: By centralizing payment data, retailers can build a comprehensive view of their business, allowing them to make better, more informed decisions.
3. Reduced costs: Maintaining a web of middleware and third-party integrations can be expensive, especially if brands have to pull developers away from innovation work. Streamlining can save retailers money and effort.
4. Increased efficiency: Operational efficiency will always be difficult to maintain in an integrated system because every integration can pose a potential bottleneck. By automating payment processes and providing real-time visibility into data via unified systems, brands can improve operational efficiency.
5. Increased sales: Customers increasingly want a consistent omnichannel experience, and unified platforms enable brands to spread promotions and bundles across POS, admin, and online stores to drive more sales and satisfy customers.

Each benefit of unified commerce payments points to a disadvantage in integrated systems. Think of the difference involved in mailing a letter vs. sending an email: The latter is direct in a way the former cannot be, even if you speed up the mail carrier’s vehicle or write the letter faster. 

Why is Shopify’s unified commerce solution unique?

Shopify is the only platform that offers a truly unified commerce solution, including a natively integrated POS and ecommerce system, a unified data model, and a cost-effective payment processing solution. When retailers choose Shopify, they can future-proof their business and thrive in today's competitive market.

Why Shopify for unified commerce payments?

Unified commerce payments are the best option for retailers looking to provide a seamless customer experience, gain better data insights, reduce costs, and increase efficiency. Shopify's unified commerce solution for payments includes Shopify Payments, Shop Pay, and Shop Pay Installments.

A unified commerce approach with Shopify delivers:

• Shopify Payments: By merging payment processes into the Shopify ecosystem, brands can reduce costs and eliminate the need for third-party gateways—cutting down on additional transaction fees.
• Shop Pay: Designed for frictionless commerce, Shop Pay provides fast checkouts and streamlined order tracking. Shop Pay does not create conflicting customer or parallel order records from a regular checkout. 
• Shop Pay Installments: Shopify POS enables buy now, pay later options in retail stores. Customers can use consistent payment plans and rates across in-store and online channels.

For brands that shift from integrated systems to a unified commerce approach with Shopify, the change feels like night and day. 

“Shopify delivers the ultimate unified commerce experience under one easy-to-use platform,” says Navid Jilow, director of technology at Belstaff. “You can't underestimate just how much easier that makes things. I've been on projects where it's taken 12 to 18 months to roll out omnichannel capabilities. Whereas with Shopify, we did it in four months.”

This difference is quantitative as well as qualitative. According to independent research commissioned by Shopify, Shopify POS offers a 22% lower total cost of ownership via:

• 22% lower retail technology costs
• 21% lower training and onboarding costs 
• 11% lower implementation costs 

The benefits only accrue over time: As businesses combine a better experience with cheaper costs to provide the experience, they can outpace their competition—even in a tight market. 

What makes Shopify’s unified commerce strategy ideal for retailers?

One of the biggest challenges in pursuing a unified commerce strategy is that many platforms purport to offer unified commerce, but only offer integrated systems. 

If you only look to check features off a list, they can even appear similar, but a truly unified system is built with unified commerce as a first principle, allowing its features to become more than the sum of its parts. Today, only Shopify can claim this status. 

• Native integration: Shopify is the only platform that offers a natively unified commerce operating system. POS and ecommerce features operate from the same platform, eliminating the need for middleware and third-party integrations, which reduces costs and complexity.
• Shopify Payments: Shopify offers payment features that create seamless and cost-effective payment processing that fully integrates with the Shopify ecosystem. Retailers can save money on transaction fees and streamline their payment operations.
• Unified data model: Shopify provides a unified data model that ensures all payment data is centralized and consistent across all channels. This unification gives retailers a holistic view of their business and enables them to make data-driven decisions.
• Extensibility: Shopify's extensive app ecosystem offers a suite of tools and solutions that are readily accessible, which significantly reduces the expenses typically incurred through custom integrations.

To learn more, explore Shopify's unified commerce solutions and start a free trial.