Simplifying commerce today with Michael Scholz

When having a conversation about commerce today, you’ll inevitably hear, “You need to offer ______________ commerce experiences.”  For a long time, you could fill in the blank with multichannel, omnichannel or connected, but today it’s just as likely someone will call out unified, composable or contextual commerce experiences as the strategy you need to employ to deliver results. Below, Michael Scholz, Vice President of Product and Customer Marketing at commercetools offers up his expertise to help you simplify the complex commerce landscape so you can make the best decisions for your digital future.

As the Vice President of Product and Customer Marketing at commercetools, Michael Scholz is fully focused on ensuring his team produces content that clearly explains the features, functionality and benefits of the company’s commerce solutions. “Everything we do is designed to make it easier for brands to deliver the commerce experiences consumers expect today,” he points out.

As one might imagine, when Michael is in the position of the consumer, having all this product knowledge coupled with eCommerce expertise turns shopping online into a very different, and sometimes frustrating experience. Case in point, recently, he wanted to buy an accessory for his SUV — a process that involved him visiting the website of a Fortune 50 automaker, reaching out to social media channels (for advice from chat groups) and calling his local dealership. “It took me a while to even find the right product, and then the product information wasn’t correct. I finally found it and went to checkout only to discover the product wasn’t available. It’s on backorder — for like two months.”

Magically, the dealership Michael called promised him they could get the accessory delivered within two to three days for the same price. The very next day, he received a call that his order had arrived. “To me, this whole experience reinforces that if you have an omnichannel experience that’s supported by modern commerce technology, all of this can be avoided. You can have much more  flexibility and control over your consumer experiences which will, more than likely, result in more conversions.” 

So, is omnichannel commerce the strategy brands should be focusing on right now?  With so many ideas being tossed around about what commerce should look like today — multichannel, omnichannel, unified, composable, contextual, etc. — it can be difficult to know how to deliver the experiences consumers want, and expect, today. Here, Michael offers up insights to simplify the complexity of the commerce landscape, clearing up any confusion, so you can create a commerce strategy able to support our evolving digital future.

Q:  As technology has advanced, commerce has gotten more and more complicated. The ongoing mantra business leaders hear every day is “embrace change or risk failure.” In simple terms, what does this mean?

A: Well, you have to recognize that before the iPhone, commerce technology platforms were built for a desktop experience. They weren’t natively or inherently built to support multiple touchpoints. The iPhone brought additional touchpoints, and brands started having to adapt their technology to address them. Today, it is almost like a new touchpoint or channel emerges every single day —whether it's shoppable Instagram, TikTok video, QR codes or even things like digital ordering kiosks and self-checkout in a physical commerce scenario. And, business leaders need to pay attention to these innovations. I don’t think you need to embrace every change, but you need to at least be willing and more importantly, able, to embrace change.

The reason commerce seems complicated is because there are so many channels. From a business perspective what that means is that you need to understand and track all the channels, and then figure out which ones are important for your business. The best thing you can do is find out what channels your audience is on. You might have to test and try different channels to see if your customers are there, but you don’t have to pursue all of them. Stay true to your audience and adapt your technology so you can be where they are. If you do that, you won’t fail. That said, if you want to expand your audience, you probably need to be exploring additional channels. 

Q:  Multichannel, omnichannel and connected commerce are all terms that have been tossed around for years. How do they differ? Which ones are still relevant in commerce today?

A:  Multichannel simply implies that you sell your products on multiple channels. Maybe you have physical stores, an eCommerce site and you set up shop at art festivals every summer. Or you’re a pure-play digital brand with your own site, a site on Amazon and affiliate marketing sites. With multichannel, each of your channels is run independently and some of them might even be managed by a third party, so you don’t have full control. As a result, consumers may see different product information, different shipping information, different checkout information, different delivery timeframes, etc. 

While multichannel was what brands were striving for 10 or so years ago, consumers today typically visit more than one channel during their shopping journey, so it can lead to frustrating experiences like the one I had trying to buy an accessory for my SUV. 

The introduction of modern technologies, i.e. MACH® and composable commerce, spurred an evolution from multichannel to omnichannel commerce. With omnichannel commerce, the goal is to orchestrate a single, consistent brand experience across all channels to deliver a seamless shopping journey. To me, connected commerce is the same thing as omnichannel. Omnichannel is just how brands use technology to deliver connected commerce.  

I do think there’s an argument that multichannel still has relevance because I’m seeing a bit of a shift back to it. Brands are realizing they may not want to present the same user experience on all channels. You might want your brand experience to be different by segment or by channel. For example, if you’re on TikTok, you’re probably targeting a very specific customer whose profile is vastly different than that of the customer shopping on your website. So, delivering the same experience across both channels isn’t going to deliver the best results. To engage both, you’re going to need to tailor the experiences differently.

What’s key here is understanding that you should be able to provide your target audiences with the opportunity to choose their customer experience, and to do that, you need flexible technology. If your platform can’t enable that, then everything looks and feels the same. And, that’s where composable commerce comes in. It gives you the freedom to do whatever you think is best for your business. It doesn’t matter how many channels you sell on or how many different experiences you want to offer, you can do it and still have the benefit of unifying your operations on the backend. 

Q:  So, is unified commerce not the same thing as omnichannel commerce? How does it fit into the equation? 

A:   Unified commerce is emerging as the next level of commerce evolution, and I think it’s becoming the more accepted vision of what commerce should look like. It’s a strategy focused on centralizing all the data you collect from multiple frontends onto a single backend platform. This improves your ability to analyze your data, giving you a better picture of your customers so you can deliver more personalized experiences.

Implementing a unified commerce strategy also aligns your product data and inventory on the backend in real-time so accurate product information and availability are always available to you and your customers. With so many brands focusing on how to collect, analyze and leverage their data, it makes perfect sense that unified commerce is entering the conversation right now. 

Q: commercetools' main product is Composable Commerce, which is a MACH architecture solution. Was the vision to provide a product that — going back to the first question — enables brands to embrace change? 

That was exactly the vision Dirk Hoerig, our co-founder and CEO, had when he and Denis Werner, the COO, launched commercetools in 2013. They recognized commerce was evolving — the number of touchpoints was increasing because of the rise of mobile and consumers were demanding better UX/UI experiences. As website developers, they knew from experience that the rigid structure of traditional, monolithic platforms couldn’t support the direction commerce was headed.

The first product was a microservices-based, API-first, cloud-native backend solution they called “headless commerce” since it didn’t have a frontend attached to it. Dirk figured out that decoupling the backend from the frontend would enable developers to make changes on either end without causing risk or disruption to ongoing operations. Even though this new architecture delivered more flexibility, agility and scalability, it was so disruptive and monoliths had such a hold on the market that it wasn’t an easy sell.

Eventually, commercetools introduced the term MACH to help describe the technologies we use to build the product. Then Gartner® coined “composable commerce” which is the approach brands take to build tech stacks that use MACH as their foundation. This was immensely helpful in getting more brands to understand the difference between modern commerce solutions and the old, monolithic platforms. Today, everyone is talking about the benefits of composable commerce and we’ve expanded our product portfolio to include Composable Commerce for B2C and B2B, as well as a customized product for China.

Q:  So, if a brand adopts composable commerce technology, by default, they are also adopting a unified commerce strategy, right? 

A:  Sure, you could say that. With a composable solution in place, you have a single backend to collect and store all your data along with the ability to add as many frontends as you like. That’s what the unified strategy is all about. For a big conglomerate that owns multiple brands, being able to allow each one to create its own unique commerce experiences based on its customer base while still maintaining control on the backend is significant. That’s something that legacy platforms can’t accommodate. Each brand has to run on its own commerce solution. Not only does that mean data can’t be easily shared across the organization but, from a business perspective, it doesn’t create economies of scale.

Q:  What’s the most important thing a brand needs to consider when making a decision about how to evolve its commerce technology?

A: The likelihood of commerce evolving and your business changing is consistent, so if you’re not where you need to be from a technology perspective, you miss out on opportunities. So, I think it's all about seeing composable commerce as giving you the opportunity, the choice and the flexibility to pursue your business strategies, support them and then test them out quickly versus being stuck on a monolith platform where if you have an idea, you can't even A/B test. You can't even launch a quick MVP and take it to market and see if it's going to fly or not. 

So, you have to think about whether you’re currently delivering what your current customers, and your potential future customers, want and need. If you’re not, and your IT team is too busy maintaining your existing technology and fixing things to innovate, then it’s time to start exploring composable commerce.

Q:  Last year at Modern Commerce Day, Carrie Tharp, VP of Retail and Consumer at Google Cloud told attendees, “It’s more critical than ever for brands to always be ready to meet customers wherever they are.”  How can a brand ensure they consistently achieve that goal?

A:  It’s almost the most overused statement at the moment in the media, but I think consistently achieving that goal goes back to having the flexibility that composable commerce offers. Number one, you’re able to meet customers where they are because you’re actually capable of building out any channel. Number two, you’re able to choose what you want to do with each channel. Do you want the channel to just be a mirror of all the other channels and touchpoints because your brand is so strong, irrespectively of channel or touchpoint? Or have you identified a new customer segment that you've never served before and want to give them an experience that engages their unique profile? 

Finally, number three, you can fail fast with little risk. Experimenting with new features, markets or customer segments isn’t the investment it was before, so if you want to try something, not only do you have the option, but you can spin it up and if it doesn’t work, you move on. If your company is sitting on top of commercetools, for example, you can tinker around with your commerce — that’s the whole idea, it simplifies everything — you can just take a couple of APIs and build out whatever you want. 

Q:  One more question, we haven’t gotten to discuss contextual commerce yet which seems to be a new buzzword that just entered the conversation.

A:  The idea of something being bought or purchased in the context of your life, whether you’re sitting in a concert hall or stadium, at home browsing through a magazine, or out window shopping — I like it. It’s definitely where commerce is headed, but I think it triggers another checkout-specific blog post, so let's save it for another time. 

To learn more about how you can gain the flexibility to wow your customers, download our white paper, How to Compose your Commerce in 2023.