Who is buying and using commerce solutions?
As Forrester outlined in their new 2020 Now Tech reports for B2B and for B2C, over a quarter of commerce solutions are fit exclusively for digitally-advanced customers. For an ideal match, commerce solutions should be considered based on digital maturity and organizations can fall into one of three categories of digital maturity with commerce:
Beginners are just getting started with online commerce. This could be a traditional retailer or manufacturer may have had a commerce website up for the last decade or two, but haven’t invested much in it. They could also be a new direct-to-consumer startup that’s just finding its product market fit and are freshly setting up their web presence.
The process of technology adoption over time illustrated as a classical normal distribution or “bell curve”.
Not all, but many beginners would be considered the late majority and laggards in the tech adoption lifecycle. Laggards are conservative to avoid risk and, as the name suggests, lag behind others in adoption of new technology as a result. They have websites that are definitely not headless and probably aren’t using cloud for new projects. Instead, they tend to opt for legacy on-premises hosting which feels tried-and-tested, without realizing or caring much about the downsides. Their IT department is likely to be fairly small due to their outsourcing of those responsibilities.
Those in the intermediate category are likely to have had a website running for a while, along with a mobile application. They may have some IT capabilities in-house and rely on outsiders for staff augmentation. They likely use public cloud for new customer-facing projects but still have a significant legacy footprint on-site and haven’t yet made investments to touch it. Still, the first steps have already been made in their journey to breaking out of the monolith — with parts of their online presence being headless, adoption of agile development, and consideration of microservices, if they haven’t started using them already.
Organizations in the advanced category are headless, have many touchpoints, use public cloud exclusively and have great in-house tech competency. The use of cloud lets them reliably handle the unexpected, such as a spike in traffic and transactions when a product goes viral, without compromising uptime. They also can nimbly deploy to setup touch points across new markets and geographic regions with ease.
Both established businesses committed to become digitally native and younger but fast-growing companies can fall under the advanced category. As far as the tech adoption curve goes, they are innovators and early adopters that are willing to try new things and use cutting-edge tech ahead of most. The payoff takes the form of flexibility, efficiency, performance and other advantages they would not get otherwise with legacy suites.
Digitally-advanced organizations have incorporated use of microservices and modern ways of working — small, cross-functional teams that each use a tech stack suited to their tasks and workflow, and with roadmaps and release cycles that are independent of each other.
This allows faster development and increased flexibility in reacting to market changes, customer demands and the competition.
Of course, there are also outliers — we’ve worked with companies that were so eager to adopt a modern commerce platform, they brought in systems integrators and aggressively modernized themselves. They dedicated themselves to the new digital era of commerce, and are now our customers.
The shift from suite to modern commerce solutions
For the 1990’s and 2000’s, many organizations were just getting started with digital commerce and fell firmly in the beginner category. Therefore, they picked suites from big vendors who could do it all for them. In essence, they outsourced everything. You’d have an ERP in the back-end and an all-in-one commerce platform that was essentially an ERP for the front-end.
However, competitive pressures (Amazon, Digitally Native Vertical Brands, etc.) and overall more widespread adoption of tech have allowed some organizations to develop in-house capabilities. Those are best manifested by exposing many customer touchpoints beyond traditional web (such as voice, IoT, VR/AR, etc.), full adoption of cloud, and modern technologies and ways of working like GraphQL and continuous integration. The ability to create unique customer experiences and configure features that are well-fitted to business needs are big differentiators so that an organization can stand out from the crowd.
For too long, the press, analysts, and thought leaders/influencers have adopted a one-size-fits-all approach to evaluating and recommending commerce platforms that was rooted in thinking from decades ago, when only suites existed on the market. Now, there’s a new type of commerce platform on the market best represented by commercetools. In fact, we invented this whole new approach. Our approach is headless, API-first, microservices, cloud-native, multi-tenant SaaS. This is all in direct opposition to the legacy suites which are not headless, not API-first, monolithic, not cloud-native, and are single tenant hosted.
These are among the advantages of a modern commerce platform like commercetools:
Commerce everywhere: The freedom to create commerce experiences that fit every current and future touchpoint you may have;
Superior development and productivity: Decoupling of your back-end from the front-end for better agility and scalability, since you can update one independently of the other;
React faster: The ability to release and innovate quicker since you’re no longer tied down to waiting for the next scheduled build that could be days or weeks away;
Always available: Better reliability and uptime as the platform scales to meet your business demands, including traffic spikes during that big sale, and you never have to go down for scheduled maintenance;
Fits like a glove: More flexibility, development speed and productivity across the board with the ability to create custom applications and feature integrations that look and feel like a native part of the commerce platform.
We were quite pleased to see Forrester come out with the below chart:
Suites are great for beginners and we tell customers all the time to come back when they’re more digitally mature. But for those who’ve built some competency over the past few decades, it’s best to start moving toward commerce components.
Compared to monolith suites, the new generation of headless commerce platforms offer many benefits to customers such as continuous daily releases, excellent compatibility with other software within their ecosystem (for instance, your CMS) and high degree of customizability to fit their exact commerce needs.
So are you ready for modern commerce?
If you don’t know what headless is, haven’t looked into digitally transforming your business or aren’t set up to leverage today’s cloud platforms, chances are your business needs to take a few steps forwards first.
But if you’re familiar with those terms and sound like an intermediate or advanced organization described above, you’re likely in good shape for a modern commerce platform and should look into options that fit your needs!
Learn more about modern commerce platforms
To get a head start in learning about this new world, check out some of our resources: