In a post-COVID world, digital commerce success is a prerequisite for overall business success. Sky-high customer expectations and abundant competition has raised the bar of a “minimum viable experience” that online merchants must deliver to customers, regardless of a company’s size or industry. Every seller must reevaluate the technology it uses to engage with customers and invest in areas of weakness. Cloud-native commerce technology, described in the first post of this series, has the potential to deliver on this promise by unlocking greater business and technology agility. However, many organizations struggle to take full advantage of the power of the cloud and cloud-native technology when not backed by an army of developers. At IDC, we are beginning to see this paradigm shift.
The State of Cloud-Native Technology in Digital Commerce
Since the inception of digital commerce over two decades ago, IT and line of business (LOB) folks have acted as unsynchronized dance partners. While LOB leaders – such as marketers, sales executives, or eCommerce managers – have often crafted the commerce strategy, they have relied on IT to develop those capabilities and maintain the infrastructure necessary to support online commerce operations. Something that sounds simple coming from the mouth of a marketer, such as adding a new localized site or changing the layout of product detail pages, can prove to cost hundreds of developer-hours for IT to achieve (particularly if staff are working with rigid, legacy commerce platforms).
Leveraging containers and API-first architectures, cloud-native digital commerce applications run on highly distributed and scalable architectures. However, cloud-native has also fallen into the IT vs. LOB trap, with technologically savvy organizations overwhelmingly being the ones gravitating towards cloud-native digital commerce technology up to this point while those merchants with less of a tech background settle with other technology options, such as hosted SaaS. Among these merchants hesitant to adopt cloud-native, three fears commonly rise to the top:
Dealing with infrastructure maintenance costs: Merchants do not want to pay staff to install patches, upgrade to new versions, and monitor the health of their commerce tech stack. These costs have been associated with legacy digital commerce platforms and are also associated with cloud-native.
Hiring the right talent: Digital commerce platforms typically require product-specific knowledge to run and maintain, including the use of proprietary development tools. Hiring developers familiar with these niche systems and tools is very expensive and hard to justify for the average online merchant.
Deviating from their competitive differentiation: Even for merchants that can hire the right talent, have budget to invest, and put processes in place, managing commerce infrastructure does not make competitive sense. Delivering excellent products, services, and/or experiences is their competitive advantage of online merchants, not infrastructure management.
Bad past experiences and a lack of understanding around cloud-native technology leads many organizations to select hosted SaaS commerce systems to simplify the perceived challenges of managing applications in the cloud. So, what’s the answer to quell these concerns? IDC believes the answer is simplicity and ease of use for business users. We think that deploying a cloud-native application needs to be as easy and intuitive as installing and running an app in the App Store.
Combining Ease of Use with the Power of Cloud Native: A Recipe for Success
While these are still the early days of cloud native in the digital commerce market, there are clear indicators about what merchants want. On one hand, some of the fastest-growing software providers in the market are multitenant SaaS vendors that aim to enable business user agility first and foremost. On the other hand, there is also a movement towards headless, API-first, and microservices-based commerce architectures that have picked up significant steam over the past 12 months; these vendors are typically proponents of technology user agility. At IDC, we believe the happy medium between both approaches is most beneficial to the average online merchant.
When evaluating digital commerce technology, merchants should look for modern, cloud-native technology that also simplifies highly technical concepts and tasks. Consider digital commerce solutions that:
Are no-code-low-code, where APIs can be dragged and dropped to build integrations by business users
Make DevOps simpler
Deploy easily in cloud environments of your choice
Have elastic scalability, so that merchants don’t need to worry about downtime during peak traffic
Enable trials to support discovery and experimentation
At the end of the day, the mandate of a digital commerce platform is to help merchants grow their sales. Cloud-native technologies that cater to both IT and LOB, and facilitate collaboration between them, should be viewed as innovation accelerators. IDC recommends that enterprises look at the next generation of digital commerce solutions based on cloud-native architectures and for vendors that help solve this IT vs. LOB divide.
This blog post is the second of a three-part series on the benefits of cloud-native commerce. The previous post focused on what cloud-native technology is and the benefits it can deliver in digital commerce. The last post will focus on how managed services offerings can further streamline cloud-native commerce.
Message from the Sponsor
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To read part 1 go here