Deliver Engaging Buying Experiences on any Device with Headless Commerce
In September 2021 Crownpeak announced a strategic partnership with Webscale, which is now the preferred cloud delivery engine for Crownpeak customers. Crownpeak’s Chief Product Officer Andreas Knoor, sat down with Sonal Puri, CEO of Webscale, for a conversation about headless architecture and how each company’s products can give high-growth e-commerce businesses the power, scalability and flexibility they need to grow and retain customers.
Read on to learn the latest trends in commerce growth, what to expect in 2022 and beyond, and how to put in place the architecture your business needs today, while positioning you for success in the future.
In a mobile-first world, digital leads the way in commerce growth
Andreas: Let's set the stage by talking about what we're seeing broadly in the industry in terms of e-commerce. There’s been tremendous growth, just over the last two years.
Sonal: As you know, with so many things closing down due to the pandemic, e-commerce has grown considerably. And, alongside that, consumer habits have also evolved. Online commerce grew by about 14 percent in 2019 to 20 percent or more in 2021. And we expect it to continue growing at a rapid rate because of consumers’ familiarity and experience with e-commerce. It's such an effective way to get in front of new consumers, so we're seeing a lot more spending in this space.
Andreas: We often tend to think of the countries with large economies as driving this growth, but the shift to digital and e-commerce truly is a global phenomenon.
Sonal: It certainly is, and that’s largely because of mobile commerce. Areas in the developing world don't often have broadband connections in the home because of the lack of infrastructure. So in these areas – as well as the rest of the world – mobile is where we are seeing the biggest growth.
Worldwide, mobile has grown by about 20 percent. The new world is mobile-first and not really desktop. That means the user’s digital experience on the mobile device is critical. So whether it's content or speed of delivery, there's a lot of focus on the mobile buyer because they are a growing and significant part of the consumer base.
Overall, half the world is online and shopping. And we want to encourage ease of consumption. We want these consumers to benefit from the technological advances that we see from some of the largest brands in the industry.
Commerce in 2022 and beyond: Moving from customer acquisition to customer retention
Andreas: The growth opportunities go well beyond global trends and traditional e-commerce strategies. The emphasis – with companies of any size and for any type of product, such as B2B, B2C, and companies that provide infrastructure to larger brands – has shifted from simply making an upfront sale to customer retention.
Sonal: Yes, we are starting to see a shift in the market. Three-four years ago there was a push around customer acquisition and measuring success based on the number of new users a company brought to their platform. But businesses quickly realized that this leads to a “leaky bucket” effect, as customers are fickle, and, in large part, because brands are not well differentiated in commodity spaces. So consumer retention is becoming a more critical aspect for these brands. And there are multiple ways to do consumer retention – beyond just packaging, product and pricing – to ensure that money spent upfront to acquire a customer doesn't just go to waste. Here are three key factors:
- Speed: One of most well-documented ways to ensure a customer stays is having a fast website. Twenty plus years of research have clearly shown that if your site is not fast, the consumer will leave. And search rankings are also becoming a part of this. If you look at new areas of focus like Google’s Core Web Vitals, if your site is not fast, you won’t show up on Google search rankings, and so the consumer is not going to be able to find you.
- Security: Security is critical. If you want to retain a customer you have to have their trust and maintain compliance to process their credit cards and keep them coming back.
- Affordability: We all know how difficult the margin game is for businesses. It’s a race to acquire and keep a customer, and affordability is a key piece of this.
Content-driven composable commerce is critical for brand differentiation
Andreas: Another key question for companies is: how do I differentiate my brand from the Amazons of the world? This comes down to content-driven commerce. Essentially, it’s what makes the buying experience of a particular company unique for customers or better than the buying experience of its competitors.
Content-driven commerce is a strategy about designing and orchestrating the full buying experience and not just focusing on the transactional perspective. It’s more about a story-driven approach. A good example here is Apple. Its web shop is all about visually representing their products and telling stories about their products in a very professional way. Content will help you to stand out and it is the number one differentiator for most consumers.
Second to this is the fact that nobody knows more about your products than you do. Therefore, you should leverage and use this knowledge to tell the right stories around the products you want to sell. Showing your expertise about your products and establishing yourself as a trusted advisor is something that will help consumers make a decision.
The third aspect is that customers are typically looking for inspiration. They’re looking for something that is specific to their situation, for specific use cases and specific proof points. They want to know, “Why should I buy the product? Why should I buy it now?” So if you are able to inspire these people, then they will evolve into lifelong, loyal fans.
And while this very clearly applies to B2C e-commerce scenarios, we are also seeing that a direct-to-consumer strategy is getting more important and relevant nowadays for B2B companies. That’s why content is so important and needs to be a critical part of the e-commerce strategy.
How headless commerce architecture is changing the way brands meet consumer demands and desires
Andreas: The most important change that we’re seeing is around how some of the largest brands are driving innovation – specifically, going with a headless content-driven commerce architecture. This allows you to make faster changes to your site and pivot to meet consumer trends and desires. Is this what you are seeing as well?
Sonal: Definitely. A headless e-commerce platform enables you to make changes to your site more quickly, whether it’s setting up new payment gateways or new ways of fulfillment, such as “buy online/fulfill in-store” or “buy now/pay later” features. The largest brands in the industry are able to make these sorts of quick changes. So when looking at headless commerce vs traditional commerce, it may be difficult for merchants who cannot innovate quickly because they have a monolithic CMS to compete on that same level.
Andreas: As you alluded to, another key to having this level of speed and flexibility is having a composable architecture that is API-driven versus a large, monolithic system that is less flexible and makes it harder to keep up with the latest technologies and customer trends.
Sonal: Being at the forefront of innovation is critical. The market is definitely going in the direction of composable packaged business capabilities, or microservices, and that means being more API-first. All these new features and functions that are coming to the market are easily integrated using headless commerce APIs. It is critical that your application can accept those APIs and work with them. That requires a pretty significant change, but not necessarily a rip and replace. It's an evolution, but it requires brands to think about the cloud as the place to be for e-commerce. This includes headless deployments with content management systems and other packaged business capabilities for their payment gateways, etc.
Ultimately, fast and secure sites, affordable products, and getting in front of consumers through innovation are all key to commerce starting in 2022 and beyond. There are no shortcuts anymore.
Monolith vs. microservices: moving towards a headless e-commerce API-first environment
Sonal: This is a fun conversation for the e-commerce world right now. Monolith versus microservices are in what feels like a giant tug of war. In our opinion, companies don’t have to choose one or the other because there's a place for both. Both have good stability and good reasons for existence. As we mentioned earlier, it’s not a “rip and replace” of an existing e-commerce platform but rather an evolution. And starting with a headless commerce architecture and then expanding into more package business capabilities is a good way to evolve slowly from an absolute monolith, or one-stop shop, towards an API-first environment.
Andreas: I couldn't agree more. What we see in the market is around 80+ percent of all the existing e-commerce implementations out there are currently using a monolithic architecture. And with this type of e-commerce platform, not only are the transactional activities taking place here, but also the user experience, the user interface, and the delivery of the end-user experience. If you want to go beyond the limitations of your vendor's packaged capabilities and adopt a content-driven commerce, story-driven approach you also need a headless commerce content management system that is seamlessly integrated into the platform and delivering the right content and transactional functionality to the end user.
Sonal: If we look at the monolithic approach, there are some advantages and some disadvantages.
Andreas: Absolutely. One, a monolithic system is a very stable, mature technology, including the content management integrations. Typically, these types of platforms have low operating costs and they are easy to test and debug.
Andreas: But there are also disadvantages, especially from an end-user experience perspective. If customer experience is your number one priority, then you will want to use the latest and greatest front-end technology. And that can be hard to implement in a monolithic environment because you are tied to the system’s e-commerce shop front-end technology, which is handling all the interactions with the client.
A reasonable alternative here is to go with a headless architecture, which allows you to decouple the e-commerce platform and content management system from the actual delivery, or “head” which creates the full user experience. Crownpeak’s headless CMS is at the center of our content-driven commerce solution enabling a composable, headless commerce API-driven approach. This allows for much more agility and flexibility regarding system updates or changes, and you don’t have to be locked-in to one vendor, especially with so many great headless commerce providers in the market. Having the freedom of choice, particularly for the front-end technology, typically creates a much better user experience from a desktop perspective and from a mobile perspective.
The building blocks of a headless composable commerce SaaS architecture
Sonal: Think of headless as being like a Lego set and you can choose what tools and vendors work best for you. Let’s break down the categories that explain how this landscape is set up.
- E-commerce platforms: These are traditional, well-known brands that typically provide a monolithic architecture. Some may be open-source, some may have expensive licensing that requires deep expertise, and some of them are more of a DIY approach where a company creates their own commerce store.
- Security/CDN delivery: We all know that where there are transactions, revenue and currency, there are also bad guys. So, we have to make sure that there's security available to protect merchants. Webscale provides a “serverless” experience to deliver CDN and security capabilities both at the origin and the edge.
- Composable stack: This category has a lot of newer players that talk about headless as a leading way to deliver. They typically provide the tools to make a very successful bid at a headless set; however many merchants don’t have in-house expertise to use those tools effectively. We're able to provide that glue that can bring some of these tools together. Because it is a composable stack, the merchant can pick and choose. It's almost like going into a buffet and choosing what you want to eat, but then somebody needs to cook it for you.
- Package business capabilities (PBCs): Think of this as pre-packaged microservices provided by a vendor, allowing a merchant to put all the pieces together and be API-first. For example, Crownpeak does a very successful job of pre-packaging the content management system for , whether it is for monolithic applications or for headless applications. It is a great way to transition from one to the other or to stay where you are at. This area is where we expect to see the most advancement in the industry. We anticipate that newer players will come to the table with PBCs and instead of saying, “here are the tools, go do it yourself," they will say “here are the PBCs, learn our APIs, get integrated, and let's make you successful."
- PWA frameworks: Progressive Web Application (PWA) frameworks provide the ability to build a fast, interactive front-end that can serve mobile and desktop. Any way the user chooses to come, they get the right experience. And it integrates and interacts through APIs with the backend.
- Front-end optimization: Think of this as a newer name for a type of CDN. It does a number of the interactive pieces for commerce brands. Webscale can deliver a front-end optimization platform in a multi-cloud format that makes it easy for customers to interact and work with any of the choices that they might make.
Andreas: So, what could this look like in real life? We can start with simple headless commerce examples. Let’s say you want to go headless with a content-driven approach. We have three critical components, which I would call the headless content and commerce triangle.
- Front-end UI: You can buy the front-end UI from a vendor (examples in image) and use a front-end as a service provider. You can also develop this from scratch, depending on your requirements.
- Headless-ecommerce system: Next up is the headless e-commerce system. There are pure headless systems or there are hybrid solutions from headless commerce providers, such as Salesforce or SAP, that can be used in either a monolithic or headless way.
- Headless CMS: And last but not least, you need to have a content management system in play. It can be a pure headless player or a hybrid headless solution like Crownpeak. So if you want to implement a futureproof headless B2B e-commerce and content strategy, this is a solid architectural foundation. And the different parts should be easily interchangeable like the Lego bricks we mentioned earlier.
The future looks bright: Moving forward with headless commerce providers Webscale and Crownpeak
Sonal: To wrap up, why Webscale and Crownpeak? Because we're really cool people and love to work together! But beyond that, content-driven commerce is the future and headless architecture is very clearly growing in popularity. At the end of the day, we want to make sure we are partnering with the right group of individuals and companies to make it easy for our customers to deliver now on this futuristic vision. We want online and mobile commerce to be half of all retail. Because, after understanding the flexibility and the ease of being able to buy and make decisions online, who wants to go back to a crowded mall?
Want to learn more about headless content-driven commerce, and how Crownpeak Delivery Powered by Webscale provides the power, flexibility and security you need to grow your e-commerce business? Speak to an expert, today >