What is composable commerce and why does it matter? Your questions answered

In an age of constant change, composable commerce has emerged as the answer for brands and retailers to stay ahead of the competition, new market developments and customer needs. Here, we answer your burning questions about composable commerce and how your business can benefit.

Composable commerce is a modular development approach that enables brands to leverage best-of-breed building blocks such as search, cart or checkout (also known as packaged business capabilities or PBCs) and “compose” them according to their needs. Think of it as LEGO bricks that provide infinite combinations, offering custom and unique ways to differentiate your business. 

These interchangeable building blocks (basically, a library of eCommerce APIs) allow you to customize your technology stack instead of restricting you to the standardized and template-like features from all-in-one platforms that may or may not suit your needs. Composing your own commerce means unlocking maximum flexibility as you can expand these building blocks, contract or even swap them entirely for other solutions.

For example, the American manufacturer of baked goods, Dawn Foods, integrated a search function by a vendor, which turned out to be incompatible with their goals. After a year, the company migrated to a new provider and plugged in the search component without a hitch. 

Coined by Gartner® in 2020, composable commerce is anchored in four core pillars: 

• Modular: Select best-of-breed components for unique business needs, assembling a customized technology stack. Plug, scale and swap components at any moment without affecting other applications or your infrastructure.

• Flexible: Create, update and customize solutions with your chosen components whenever you want, however you want.

• Open: With a modular and flexible architecture, you have the freedom to select vendors that offer the commerce solutions required for your specific business needs, so you can say goodbye to vendor lock-in. 

• Future-proof: Being able to tailor the tech stack with swappable components means staying ahead of new market opportunities and changing customer needs.

It’s no secret that today’s customer experiences come with high expectations! Consumers want to interact via multiple channels throughout the shopping journey, and personalization is key to upselling and cross-selling effectively.

For instance, shoppers may start a purchase online and then go inspect the product in-store before comparing pricing and finishing the transaction on a mobile device. They may feel compelled to engage with a brand after seeing a product featured on an influencer's Instagram or search online to look for the best deals during Black Friday. Consumers want to connect with brands on their terms and whenever it suits them, and expect a highly convenient, consistent and inspiring experience. After all, 80% of consumers say a company’s experience is as important as its products and services.

Composable commerce enables brands to continually translate these expectations into exciting brand experiences by plugging in the best-of-breed eCommerce components that suit each of these demands and needs.

For example, the beauty retailer Trinny London added a component that delivers a more tailored checkout experience by presenting customers with sample options that complement the products purchased, such as an eyeshadow matching the color of a purchased lipstick. At the same time, BMW Group is able to auto-scale online capacity during traffic peaks across multiple touchpoints, such as Connected Drive, boosting omnichannel sales like never before.

Traditional eCommerce solutions, also known as monoliths, are indivisible blocks of standardized software that are rigid and slow to update. Every time you change or update something, the entire system must be retested and redeployed, which may cause issues or even a complete system crash. This inherent lack of flexibility and agility doesn’t compute at today’s accelerated pace; consequently, companies struggle to innovate and even hire and retain talent (unsurprisingly, top engineers aren’t eager to work with old technologies). 

For instance, Chris Bach, co-founder of Netlify and board member of The MACH Alliance said at Modern Commerce Day 2022 that companies need to recognize that “tech choices matter. Imagine telling a marketer they just have to do legacy ads in the yellow pages… that’s it. They’d probably move on. The same goes for developers…they don’t want to work with legacy solutions. They want modern stacks.”

The cost of running monolithic infrastructures has also become prohibitive for many firms due to additional fees for upgrades, integrations, etc. 

That said, composable commerce is gaining traction in the digital space because it’s the answer for brands and retailers to manage constant change in their customer experiences without spending a fortune. Because composability transcends commerce and can be applied across all IT environments, companies can shift from a monolithic approach to maximum flexibility in their technology stacks, so they’re adaptable to whatever the future brings. 

The story of food and beverage giant Danone encapsulates the need for adaptability in times of constant change. By leveraging composable commerce, the company made its first inroads into direct-to-consumer (D2C) sales to address the baby formula crisis during the COVID-19 pandemic in 2020, enabling distressed parents to find the right nutrition products for their babies directly on Danone’s website. The France-based company’s healthcare division in the UK is able to use the same backend commerce solution to enable B2B customers to order medical samples directly from Danone, streamlining the customer experience while gathering critical data on how these customers use its products. 

As Gartner states, “Monolithic digital commerce applications cannot support the agility and flexibility needed to support fast-moving digital business. Organizations will need to move toward composable commerce to keep up with the pace of change in customer demand.”

Composable commerce has emerged as the modern answer to replace monolithic platforms, anchored in maximum flexibility, scalability and agility for businesses of any size or industry. Key benefits of composable commerce include:

• Create omnichannel shopping experiences: With a composable stack, brands can create and tweak customer experiences without constraints. You can add or remove new touchpoints, create high-performance and fast digital storefronts, release new features and customize journeys like never before. 

• Adapt to constant change: The pandemic and other macroeconomic shifts like the war in Ukraine, Brexit and rising inflation globally create challenges for customer experiences. With composable commerce, you can easily adapt to new market conditions, creating new ways of interacting with consumers, like curbside pickup. 

• Avoid vendor lock-in: Composable commerce is all about freedom. With modular iterations and best-of-breed, you can add, remove or switch functionalities without vendor lock-in.

• Reduce total costs of ownership (TCO): Because composable commerce is versionless, you never struggle with upgrading or maintaining old versions, so you can eliminate technical debt and reduce costs. In addition, you can avoid monitoring costs, endless customizations, and hosting fees that bloat your IT budget unnecessarily. 

• Expand to new geographies and/or business models: Test and launch new business models from B2B, B2C and/or D2C with a business-model-agnostic commerce engine under the hood. You can also try new channels and expand to multiple countries, uniting multiple countries and brands under one roof and effectively managing languages, currencies and local regulations.

• Orchestrate data without limits: Without being tied to a monolithic platform, you’re in charge of your data and can use it to upsell and cross-sell across the customer journey. 

• Innovate faster: The flexibility afforded by composable means tech teams have more freedom to iterate and experiment with touchpoints and features without incurring downtime. The result? Teams can focus on innovation output, reducing time-to-market for new releases.

• Scale automatically: Composable commerce is cloud-native, so you can scale online capacity automatically, ensuring your eCommerce performance and speed. 

Like everything in life, however, there may be roadblocks and challenges. A few things to consider as you explore composable commerce include:

• Multiple components and vendors: Managing multiple best-of-breed solutions means dealing with more vendors, negotiating subscriptions and pricing, contracts and integrating terms for each solution. 

• Adopting new technologies requires a mind shift: Implementing composable commerce may require a digitally mature organization with a deep collaboration approach among tech and business workers. However, implementing composable commerce is not as complex as you think: It’s more about shifting the mindset toward composability and using specialized partners during your digital transformation. 

Overall, the benefits of composable commerce outweigh the drawbacks, so it’s time to consider this new technology for your business.

Today, consumers shop across multiple channels and devices. For instance, they may find a clothing item they like in a brick-and-mortar store but not in their size, prompting an online search to track down the desired item. Conversely, they may find something online and head to the store to try it on and purchase it. Consumers expect to find, engage with and buy products from an array of touchpoints that range from the traditional in-store and webshops to the more cutting-edge channels of social media, in-car dashboards and augmented/virtual reality (AR/VR).

More than managing touchpoints and device responsiveness, omnichannel commerce is about making those shoppable experiences seamless and cohesive, no matter the touchpoint in which the consumer starts or finishes the buying journey. Implementing BOPIS (Buy Online, Pick Up In-Store), which merges digital and physical shopping while offering customers a more convenient way to shop, is a key example of a unified experience across in-store and digital touchpoints.

As omnichannel strategies drive an 80% higher rate of incremental store visits and companies with strong omnichannel customer engagement see a 9.5% year-over-year increase in annual revenue, it’s clear that boosting an omnichannel strategy is the path forward.

This is where composable commerce comes in. With a modular, best-of-breed architecture, composable commerce provides the flexibility and agility for brands to add, adapt and even remove touchpoints without friction, as well as benefit from mobile commerce with device responsiveness. In addition, composability enables brands to customize their touchpoints and how they connect with one another. 

For instance, Mars, best known for M&M’s, Skittles and Snickers, implemented composable commerce to provide a personalized experience with a “My M&M’s” online store for customers to create custom bags of candy, as well as marrying the physical and digital worlds with BOPIS. American retailer Ulta Beauty has also created shopping experiences that mirror in-store with digital thanks to composable commerce. For example, the company provides virtual beauty advisor services like GLAMLab, enabling consumers to try on thousands of beauty products via the web or app and get personalized recommendations without having to step into a store.

There are three ways to transition from a monolithic platform to composable architecture:

Switching from monolithic to composable with the “Big Bang” approach 

The monolithic platform remains in place until the composable infrastructure can be switched on — which can take months or even years. This is a risk-prone migration alternative due to unpredictable errors that might cause headaches and, in the worst-case scenario, switch back to the monolith.

Beheading the monolithic architecture 

This option decouples the customer-facing presentation layer from the monolithic platform with headless commerce. Still, it keeps the business logic in the commerce engine intact, as well as the ERP and CRM integrations plugged into the system. This is usually a temporary solution toward composable architecture. 

Phased migration with the strangler pattern

Break your monolith into small pieces and replace those with single components incrementally. Over time, the monolith will suffocate and disappear. Progressively build your composable commerce architecture, controlling every step of the way and minimizing disruptions and mitigating risks. The main benefit is clear: You don’t have to wait for a “switch day” to see the first results!

With composable commerce’s inherent modular design, a phased migration via the strangler pattern provides a great choice to re-platform and migrate data step by step. 

Take the example from Trendhim: The Scandinavian retailer first integrated commercetools as its centerpiece to connect every aspect of the customer journey. Next, the team at Trendhim selected a low-risk system to migrate first — fulfillment — and plugged it. This gradual rollout also allowed the company to optimize constantly, unplug components when something went wrong, and stay on top of its migration roadmap with minimum disruption to the business.

Driving the uptake of composable commerce are the principles of MACH™-based architecture. The technologies behind MACH (Microservices-based, API-first, Cloud-native and Headless) comprise the technical backbone needed to deliver composable commerce now and in the future. 

Countless companies have already future-proofed their commerce architectures with MACH to manage constant change. For instance, when the Canadian made-to-measure menswear retailer Harry Rosen decided to modernize its commerce infrastructure, the COVID-19 lockdowns hit in full force. Suddenly, the fashion company had to become a digital-only player while handling Black Friday-like traffic daily with a crumbling webshop. 

With MACH, Harry Rosen translated its beloved in-store personalized consultation to a digital laydown experience. Their clothing advisors pull together various fashion pieces to create a wholly curated look for individual customers, with the client’s correct size and in-stock items. The recommendations are shared as a digital webpage, giving clients more confidence to buy complete looks fitting their style with an easy option to add their desired items to the shopping cart. 

The results? 300% growth in orders, a 1.8% increase in basket value and a 3x lower return rate. These stunning numbers have been made possible because the tech team at Harry Rosen was able to accelerate feature releases like never before. 

Stories like Harry Rosen’s show how composable commerce, implemented through adopting MACH architecture, enables companies of any industry or size to surf the waves of change now and in the future.

Gartner predicts that “organizations that have adopted a Composable Commerce approach will outpace the competition by 80% in the speed of feature implementation.” Indeed, composable commerce, alongside MACH, is poised to grow exponentially in the years to come as businesses choose to ditch monolithic platforms in their quest to elevate customer experiences, improve and lower costs in IT infrastructures and boost revenue streams.

Ready to dive deeper into composable commerce? Check out the guide How to Compose your Commerce in 2023 and our Composable Commerce solutions for B2C and B2B.