E-commerce is constantly facing the challenges of the digital ecosystem.
Where the demands of consumers and the volume of competitors force organizations to offer flexible, agile and adapted solutions to the needs of the business, and this is the case of ‘composable commerce’. Let’s see here the differences between composable commerce versus traditional one.
Thus, e-commerce platforms have evolved from traditional commerce to composable commerce, forcing industry leaders to stay on the cutting edge of technology and ensure its proper use.
In a sector where, according to a publication made by Oberlo, a growth of 9.4% is forecast for 2024, raising sales to 6.3 trillion dollars.
Not having the knowledge to clearly differentiate the characteristics, advantages and disadvantages of each approach could directly impact business profitability.
In this article, we will break down the differences and advantages of each of these approaches, as well as considerations for transitioning from traditional commerce to composable commerce.
Composable commerce and development via microservices have a lot in common, both are modular, API First and headless approaches. Here are the basics you need to know about Microservices.
History of traditional e-commerce
E-commerce began with the emergence of the Internet and Web pages in the 1990s, which opened up new spaces for the sale of products and services.
These spaces as well as the technologies associated with them evolved into comprehensive software solutions with a finite set of functionalities and features, known as traditional e-commerce.
Traditional commerce platforms offer software solutions with a monolithic architecture that integrate functionalities such as shopping cart, products, payments, among others, into a single system.
These architectures consist of a presentation layer (front-end) with the user interface, which communicates with the business layer (back-end) where the business processes, rules and operations are defined. Both are integrated into a cohesive and unified system, and a coupled infrastructure.
These platforms offer multiple advantages such as simplicity of installation and maintenance, security and stability.
But in today’s digital ecosystem they generate significant disadvantages for businesses such as lack of flexibility, lack of customization, low scalability and dependence on a single technology provider. This hinders growth and the fulfillment of customer expectations.
The emergence of composable commerce
Composable commerce arises in response to the needs and demands of the digital ecosystem, forcing e-commerce to adapt to new trends and market demands, which were impossible to cover with traditional commerce.
A publication made by Gartner in 2020 mentions this need as follows:
“Application leaders responsible for digital commerce must prepare for a “composable” approach using packaged commerce capabilities to move toward future-ready digital commerce experiences.”
Referring to the need for digital tools that enable adaptation to the constant change that the digital environment demands. And creating a composability approach, which consists of the separation of functionalities in different modules that combined form a system.
Thus, companies are able to create and manage their e-commerce solutions in a customized way from modular, flexible and scalable components.
Key attributes of composable commerce
1.- Headless
Which implies that the presentation layer (Front-end) is separated from the business rules layer (Back-end).
Thus, the responsibilities are separated into independent modules.
2.- Cloud-native and based on microservices.
A feature that allows to keep the functionalities decoupled, making a modular platform, which allows to maintain independently each of the components, and taking advantage of the great benefits of cloud environments.
3.- API first
All components separated into front-end and back-end communicate through standardized APIs.
The different components of composable commerce communicate with each other via standardized interfaces, which facilitate integration and interoperability. In this way, companies can combine their own components with third-party components, creating customized, personalized and differentiated solutions.
Learn about other features that Microservices shares with Composable Commerce: The 10 advantages of microservices architecture.
Technical Comparison: Composable vs. Traditional
E-commerce, whether traditional or composable, offers different advantages, and even the possibility of combining both approaches as a particular strategy for each business.
Therefore, recognizing the technical characteristics that make them similar or different is vital for decision making, especially in aspects such as infrastructure and architecture, which have a direct impact on costs and response times.
Architecture
While traditional commerce packages all functionalities into a single indivisible system or platform, composable commerce is based on the separation of functionalities into small independent and autonomous services called microservices.
With a monolithic architecture, you can take advantage of centralization, security and easy maintainability because everything is unified and integrated.
But other risks are faced such as high dependency, low scalability and customization. All of these characteristics are offered by the API-driven modular architecture of composable commerce, along with others such as flexibility.
Flexibility and Scalability
Composable commerce is based on cloud-native technologies, which allow taking advantage of the resources and services offered by the cloud, such as scalability, elasticity, availability and security.
Whereas traditional commerce uses on-premise technologies, which require proprietary infrastructure, limiting growth to the current platform.
This means that composable commerce brings greater flexibility to online stores by facilitating and speeding up the inclusion of new services through the API without impacting operability. Additionally, it gives teams the ability to efficiently allocate resources to the components that generate the greatest demand, optimizing their use.
Ease of system integration
The API First feature of Composable Commerce adds the ability to use APIs (Application Programming Interface) to integrate various applications and microservices.
This enables the integration of different types of software tools in an agile way. Traditional commerce, on the other hand, faces the major challenge of creating new solutions that allow access to new features or functionalities, making integration much more complex.
User experience
Headless composable commerce separates the user interface from the operations, allowing companies to adapt their services to the preferences of their users, and offer an optimal and satisfactory shopping experience to their customers.
Whereas, with traditional commerce, the interface is limited by the features offered by the selected e-commerce platform.
Composable commerce is just one of many current eCommerce trends, discover 9 eCommerce trends driven by Artificial Intelligence.
Advantages of Component Commerce
Composable commerce offers a series of advantages for companies that want to improve their e-commerce business.
As mentioned in Elastic Path:
“With a composable architecture, you now have the technological power to assemble a best-in-class commerce solution, which means you can pioneer new, high-performance commerce experiences.”
Agility in the Market
The ability to choose the components that suit the company’s needs and objectives, and change or update them according to demand, without affecting the system. It allows e-businesses to react to market changes and customer demands in an agile and fast way, offering customized solutions.
Continuous innovation
Composable commerce, being built in a way to easily integrate new components, gives companies the ability to evolve continuously, without depending on updates from the e-commerce provider as in the case of traditional commerce. Incorporating capabilities to create new and better services that provide a differentiating element with the competition.
In fact, the web portal Commercetools offers a clear example of how a company leveraged the innovation of its services in a composable commerce platform, resulting in an absolute success.
Operational efficiency
Dependence on suppliers forces traditional business owners to invest in upgrades that they may not require, impacting the cost of their services.
With composable commerce, suppliers can be diverse and can be substituted without impacting the operation, focusing resources on services that impact business profitability.
In addition, composable commerce improves performance and productivity by accelerating time to market for new functionality.
Transition Considerations
Any migration process requires a prior analysis and a clear understanding of the needs driving the change. It is important to take into account the current business situation in terms of:
- Current technologies
- Levels of customization or flexibility required
- Communication channels with customers
- Competitive differentiators
- Business objectives and strategies
- Resources available
With this, the strengths and areas of opportunity will be evaluated, which will allow defining if the migration to composable commerce is adequate for the company, due to the flexibility, agility and customization it offers, or if it is the right time to implement it.
Planning and Preparing for Composable Commerce Strategy
When determining that composable commerce is the solution that the organization requires, it is important to:
- Define the business objectives that will guide the migration, thus determining the stack of components that will shape the organization’s composable commerce.
- Select the components that based on the needs, priorities and requirements of the business will be part of the solution, considering external or internal suppliers.
- Identify the areas of implementation where the migration can be simpler and generate greater benefit.
- Perform the migration in a granular manner, so the impact will be lower in costs and operability. Additionally, there will be room for technical and process tests that will allow perfecting the migration process.
Composable commerce solutions add high value to organizations, but also add challenges due to the complexity involved in working with a diversity of components, from different suppliers and even different technologies.
For this reason, it is necessary to rely on experts or suppliers to provide the necessary support for the adoption of each component. Additionally, since it is not a ready package, the initial implementation requires more time and dedication.
Best practices in eCommerce development are the microservices approach and composable commerce. Learn about other best practices for implementing an eCommerce business.
Composable Commerce vs. Traditional Commerce – Conclusion
In a digital era where the needs of the environment and users change at an accelerated pace, having e-commerce platforms that add flexibility, agility and customization, such as composable commerce, is what will guarantee permanence in the market.
Thus, composable commerce is the future of e-commerce, allowing the creation and management of tailor-made solutions with the differentiating elements of each business.
Composable commerce marks another step in the evolution of traditional e-commerce, leaving behind the standard monolithic and rigid platforms, and initiating a new era of building blocks that take full advantage of the benefits of the cloud, microservices and containers.
Knowing these differences will enable e-commerce leaders to make informed decisions that foster the growth of organizations in a progressive and controlled manner, optimizing the use of resources and increasing profitability.
At Nulogic we are specialists in the implementation of composable eCommerce platform solutions, supporting the implementation and integration processes, so that our clients acquire the maximum benefit from them.