There comes a day when a brand’s commerce site does not meet all its enterprise needs — and even actively holds them back from innovation. Case in point, a new retail industry report, Retail ecommerce in context: The next iteration, reveals that 35 percent of brands have budgeted for, or are planning a change to their ecommerce platform.
When a legacy tech stack requires updated functionality and features, replatforming is one option, but an incremental “strangler” modular approach should be considered as well, says Senior Product Marketing Manager at Bold Commerce, Anatolii Iakimets.
Also referred to as composable commerce, modular architecture allows retailers to pick and choose the specialized microservices they need most, and it doesn’t require a complete overhaul of their current platform to implement.
Often, there’s one key customization pain point — for instance, limited checkout flexibility — that drives a brand to consider replatforming, says Iakimets, but a modular structure allows a brand to address a specific issue with far less downtime and expense.
Ultimately, retailers should pinpoint the functionality improvements they require, weigh the business risks of replatforming against alternative solutions, and then evaluate whether a new full-stack solution is necessary at all, he says.
Customer demands driving need for innovative functionality
The RSR report identified that customer value propositions have shifted towards convenience, meaning “more ways to shop, fast delivery, preferred payment methods, shipping options, same day pick up, and even hassle-free returns.”
According to the report, retailers are looking to add or improve these convenience-focused capabilities in an effort to improve their customer satisfaction scores, increase the value of average orders, and boost customer lifetime value.
Retailers are also aware of how important the omnichannel experience is for customers, but how challenging it can be to deliver. The report found that providing seamless online and offline service (58%) was a top business challenge for half of leading retail respondents. However, it is difficult for them to move to “a real-time, single view of the customer and inventory” due to “rigid, siloed data and technology infrastructure.”
Although adding these capabilities may be possible with a monolithic platform, it can take a tremendous amount of time and money to do so, because any customization requires extensive changes.
Paul do Forno, Managing Director, Deloitte Digital talked about this on a recent episode of Bold’s Own Your Commerce podcast: “Back in the day there were platforms that were integrated front and back, and [it was] very hard to pull out bits and pieces. Now, being able to differentiate…is a way to very quickly add value. So we’ve seen that a lot with very specific things — be it subscription, different payments capabilities, different functional tax services — become part of what is driving a transformation, as opposed to like, I’ve got to change everything at once. It’s really based on what the opportunities are in the functional areas.”
Iakimets agrees: “Retailers on legacy commerce platforms want to switch to more modern platforms because they are focused on growing revenue, making changes quickly, offering a better customer experience — which they cannot accomplish easily because legacy technology is rigid and expensive to maintain.
As well, the lack of flexibility in legacy platforms makes it difficult for retailers to launch new opportunities that might directly increase revenue such as, “implementing new sales channels, new promotions, or new products like subscriptions,” he says.
The challenges of replatforming: Timelines and downtime
For those retailers looking to modernize their commerce stack, replatforming can be a daunting option. It is often a massive undertaking that can require a significant investment, says Iakimets. Two key areas of business risk with commerce replatforming are:
- Timelines: “Implementation will likely take longer and be more expensive than expected,” says Iakimets citing a Project Management Institute report that found 43 percent of IT projects exceed their planned budget and 49 percent complete the project late.
- Downtime: Once the project is finished, “if your new commerce platform doesn't function as planned or your launch doesn’t go smoothly then you have a big problem because you’re losing money,” he says. Of course retailers allow for some downtime, but a smooth, working system is mission critical and if that fails, customers will turn to other brands and sales will be lost.
From a technical perspective, the actual migration of data from one platform to another, as well as the potential need to integrate different vendors and APIs for customizations is also quite complex, says Iakimets. After all, “your commerce platform is integrated with a lot of things like your CMS, order management, product information management, etc.,” he says.
So even though almost a third of respondents to the RSR survey are interested in replatforming (28%), the main inhibition to improving online shopping experiences for their customers is that “existing technologies are difficult to change.” This may explain why, as the report highlights, that “the largest group of overall survey respondents (40%) favor increasing investments in their current ecommerce solutions to accommodate new requirements.”
Iakimets says retailers have to weigh the cost of a new full-stack solution against more flexible options built with headless architecture, which allows customization to consumer-facing frontend platforms, without requiring backend modification and vice versa. “The choice is a tradeoff between risk and control,” he says.
Consider best-in-breed solutions provided by MACH architecture
As an alternative to replatforming, Iakimets suggests a best-in-breed solution, which allows brands to “rebuild their tech stack by picking individual pieces to address specific needs”. For instance, the RSR survey reveals that offering same-day pickup and one-click checkout are top priorities for retail companies. These individual features can be implemented much faster and require shorter downtime periods with modular options that focus on one functionality at a time, versus the long and complex process of a full replatforming, according to Iakimets.
Known as leveraging a MACH ecosystem — which stands for microservices-based, API-first, cloud-native SaaS and headless — the best-in-breed approach offers “the best solutions from multiple vendors, with low risk and easy deployment and allows you to update your tech stack over time,” says Iakimets.
If a solution adheres to all four MACH principles, it can integrate with a retailers’ commerce stack, whether legacy or otherwise, says Iakimets. Even if a monolithic platform is in use, best-in-breed can essentially bypass the older, more rigid infrastructure to address brand priorities head-on.
Here’s how each concept contributes to the overarching ecosystem:
- Microservices are backend software applications that function (and can be scaled) independently, offering up specific solutions. They can be accessed from a variety of different sources/vendors.
- API-first means all functionality flows through Application Programming Interfaces (APIs) that connect decoupled frontends and backends.
- Cloud-native SaaS means the solutions are all hosted and consumed from the cloud as needed (so you don’t have to deploy from a data centre or buy hardware, says Iakimets).
- And of course headless refers to decoupled platform architecture.
As an example, the Bold Checkout Experience Suite is a MACH-based solution, says Iakimets. “It provides expansive checkout options via an API that can connect with any platform, it’s microservices-based at the backend, stored on Google Cloud and integrates easily with headless commerce.”
When the suite is utilized, a retailer can activate a fully customized solution that allows for multiple delivery and pickup options, the choice of one-page or multi-page checkout steps, and the ability to offer transactions on any platform — even connected devices.
Best of all, MACH solutions efficiently address customer demands for improved convenience, streamline their omnichannel experience and make it possible to incorporate promotions/subscriptions, whether you replatform or not, says Iakimets. It’s a simpler, more customized approach to both addressing ecommerce pain points and engaging new revenue opportunities, while modernizing a platform as needed.
Download “Retail ecommerce in context: the next iteration,” sponsored by Bold Commerce, here.