At Google Cloud Next ’23, our VP of Product & Customer Marketing, Michael Scholz, introduced how commercetools enables retailers and brands to power next-generation digital experience with data, cloud and generative AI.
With global retail sales increasing by 56% to about USD 8 trillion by 2026, there’s a great opportunity for brands and retailers to build amazing experiences that engage customers and convert sales faster. At Google Cloud Next ‘23, it’s been crystal clear that the combined use of the cloud, data and generative AI can become a transformative power for businesses to truly deliver omnichannel experiences at scale.
At the breakout session moderated by Tina Liu, Senior Partner Marketing Manager, Google Cloud, Michael delved deeper into why and how it’s already possible today to achieve best-in-class experiences with composable commerce.
Taking a composable approach for maximum flexibility and efficiency
As a composable commerce platform, commercetools gives the ability for brands and retailers like Lululemon, Ulta Beauty and Sephora to build tremendously flexible and scalable experiences. More than ever, these brands require scalability to build the amazing experiences that customers crave, and composable and cloud-native is the infrastructure enabling that.
Composable commerce positively impacts brands, from faster time-to-market for new releases to lower cost and higher efficiency, on top of the flexibility they can unlock to create experiences that customers love. After all, a composable approach enables brands to pick and choose the functionality they want instead of relying on legacy platforms that provide a wide range of vanilla features that may or may not be relevant to your business.
Think about your iPhone or your Android device, you're probably only using 10 or 20% of the capabilities there. That’s the same notion with these commerce platforms. You might have a content management system, you might have payment integrated, but it doesn't mean that it's best-of-breed or helping you to achieve your objectives there.
VP Product & Customer Marketing, commercetools
Cloud-native all the way
Managing heterogeneous environments can only be done with APIs and microservices, which offer a rich set of commerce functionalities and processes that can be consumed by customized, cloud-based applications. Moreover, being cloud-native has never been more important: By being a first-class citizen in the cloud, commercetools can unlock the entire Google Cloud ecosystem, from Vision AI to BigQuery services. Also, all the products, customer data, order data, and so on, that live in Google Cloud, can be easily surfaced and accessed through the APIs commercetools provides.
Architectural design: commercetools Composbale Commerce on Google Cloud
With saved and stored data embedded in Google Cloud, retailers no longer need to rely on media libraries that are hosted somewhere else or on-prem in the ERP. Everything can be accessed, changed, and inquired. So, if a customer requests: ‘Is this item available?’ or ‘Is the store available to send it to me out of the store?’, all of this data is available and can be accessed through a powerful workflow.
A typical workflow with commercetools Composable Commerce on Google Cloud
The MACH® approach (the seamless combination of technologies such as microservices, APIs, cloud-native and headless) is the technical backbone of composable commerce and, on Google Cloud, enables brands to achieve 5x more ROI in three years, as well as reduce TCO and accelerate deployments and migrations.
For instance, the American retailer Ulta Beauty leveraged commercetools on Google Cloud to become more flexible and scalable, seamlessly uniting thousands of offline and online retail channels for enhanced omnichannel capabilities. Similarly, the retailer L.L.Bean powered the seamless interconnection of physical and digital retail including social commerce, point-of-sale systems, pop-up shops, clienteling, and transactional customer care as the foundation to create truly unique and differentiated experiences.
Beyond the buzz: GenAI
As the underlying infrastructure that powers the commerce engine, commercetools see generative AI in a pragmatic way rather than a trendy fad. For instance, key applications for GenAI are surrounding the promotion and content engines, which is not what commercetools does. Therefore, the company is looking into ways to make our platform better, such as providing a low-code/no-code environment for operational users, developers and engineers to use AI.
One application would be to create integrations: If you want to use a search engine, marketplace offering or content management system, you can create a prompt that says, “Build this integration for me.”
So when we're talking about GenAI in the context of content, we want the content management system to take over. If we are talking about it in a search context, we want Google Cloud, Algolia or Constructor to take over and build that AI in those applications.
VP Product & Customer Marketing, commercetools
And that’s the power of composable commerce: It’s all about orchestrating every single piece of the commerce puzzle under the hood. After all, when you build best-of-breed applications, they should perform at their best while the sum of its parts enables the amazing experiences customers look for.
That’s why we want to take a pragmatic approach to [generative AI]. That's why we're very much tech-focused on that and we have a huge ecosystem that builds in that GenAI aspect from a partner perspective.
VP Product & Customer Marketing, commercetools
Top 3 takeaways
To summarize, this is what brands and retailers should pay attention to when exploring how to leverage digital experiences today and tomorrow:
Composable commerce is the best foundation for generative AI.
This is because the data is available in one location sitting in Google Cloud, so it can be used in the entire commerce ecosystem. For instance, every independent software vendor connected with commercetools has access to that data, which makes it possible to prompt an AI tool like Jasper or ChatGPT to get information in terms of inventory, product data and availability.
Data is key.
When customers get started in their migration to a composable architecture, managing data is the first step in their digital transformation. Many of them struggle with the data model and the data concepts from their legacy vendors. Therefore, the first thing they should do is clean up their data and leverage a flexible data model. If you skip that first step, whether you use big data or generative AI, the data is not good enough to help you in making decisions, driving customer experience, etc. Figuring out what that data looks like and how it can be crafted and available should be a priority.
Don’t jump on a fad.
Just because everybody's talking about GenAI, you don’t have to want to apply that and use it. Be pragmatic about it and where you want to use it and then find applications that are meaningful to you.
Want to dive deeper into all the insights at Google Cloud Next ‘23? Watch the session here. If you’d like to discuss how commercetools Composable Commerce works together with generative AI, get in touch with us.
Manuela Marques Tchoe is a Content Writer at commercetools. She was a Content and Product Marketing Director at conversational commerce provider tyntec. She has written content in partnership with Facebook, Rakuten Viber and other social media platforms.