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Chapter 1. New Rules of Engagement > A New Kind of Business

A New Kind of Business

As retail stores added catalogs and/or the Internet to their channel mix, they initially feared cannibalization of customers and sales by the new organizations within their own companies. Also, most corporate structures created profit and loss silos within the organization, intending to effectively measure each type of store. In actuality, it set up the sister channels and stores to compete against each other for customer sales, internal resources, and power. There was no top-level support for integration.

What results from this model is disintegration, when individual stores have no incentive to share their best practices and information or leverage promotions to their sister stores. A few businesses now recognize the importance of integration across all of their stores to maximize sales, marketing activities, customer experiences, infrastructure and supply chain efficiencies, and overall corporate profits. They are creating and applying new business models that recognize integration to create a whole that is greater than the sum of the individual parts.


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