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Guide | July 12, 2021

Headless eCommerce - How Did it Become the Future of eCommerce

Let's face the reality: Your old enterprise-grade eCommerce platforms weren’t built to serve the way customers of a digital-first world purchase, whether they are B2B, B2C, or B2B2C. So, how different are legacy enterprise eCommerce platforms compared to headless, API-first solutions? How did the revolution for headless eCommerce happen? And what does it mean for business globally?

SmartOSC has much to discuss about this trend of the future, check out our complete guide here.

What is headless commerce?

What is headless commerce

Headless commerce is believed to be the future of eCommerce

Headless commerce is the separation of technologies used in the front-end presentation layer from the back-end eCommerce functionality in eCommerce sites. When the functionalities are divided into individual components which interact via standardized interfaces, new experiences are crafted with ease and better speed. In the meantime, these components are evolving independently of each other.

Business owners need to update themselves with headless commerce know-how because it enables more options in terms of eCommerce platforms. eCommerce platforms in this model serve up PCI compliance, security, fraud management, and inventory management that can also connect to larger, key infrastructure points such as ERPs, PIMs, OMS, and POS. For brands focusing on influencer/ native advertising, or experience-navigation such as travel/ lifestyle, and direct-to-consumer brands, a content-led or experience-led strategy like headless commerce is often a no-brainer.

How headless eCommerce works

Headless eCommerce systems work by passing user’s requests between the presentation and application layers through web services or application programming interface (API) calls.

For example, when a user taps on a “Submit'' button on their device, the headless eCommerce systems presentation layer immediately sends an API call to the application layer to process the “submit” order/ request/ information. Upon receiving the information, the application layer will send back another API call to the presentation layer, showing the user the information they opt for.

So, is headless right for me?

As stated in our previous Guide to Optimizing your Conversion Rate Strategy on Magento, each business has its own perks, demands, and segmentation. For example, for those owning a single channel and a storefront managed by simple tools, headless is totally unnecessary for them. 

But, we all know how fast legacy systems go outdated and how high the customer’s expectations today are! According to Mckinsey, companies with greater digital capabilities were able to convert sales at a rate 2.5 times greater than companies at the lower level did. This Europe-centric data saw a strong correlation between the likelihood that customers will choose a brand to buy from being improved depending on the number of digital touchpoints they have.

Companies with greater digital capabilities were able to convert sales at a rate 2.5 times greater than companies at the lower level did.
% of sales dominated by digital touchpoints to select brands

What SmartOSC draws from this study is that most businesses must think through before strapping themselves into a full-stack system, hanging technology innovation out to dry. In a time when customers are showing that they truly want to engage with business across multiple touch points, you’d better be able to cater to them the way they want, speak their language or they’ll leave you behind.

Headless commerce vs. traditional commerce comparison 

Think of headless eCommerce as decoupling the customer side from the technical side, how different it will be from traditional commerce? 

Traditional eCommerce

The most traditional eCommerce model is the monolithic model, developed over two decades ago. At that time, monolith architectures were the only option for eCommerce businesses, leaving enterprises with no choice but to build on and constantly update and maintain these increasingly complicated structures. For instance, if you buy IBM hardware you must use IBM software. 

In 2021, many brands are still keeping their monolithic strategy, and many eCommerce solution agencies are still recommending it for enterprise and well-established businesses. While the monolithic model gives the IT department full control over the platform, it has quite a lot of downsides.
 
Time-consuming customizations: If businesses want to enhance their website’s personalization or customizations experiences, developers will have to alter both underlying database code as well as front-end platform. Not only is it time-intensive, but it can also make the system more and more complicated over time, for different development teams working on the system over the years.

Slow response to market trends: The more it gets updated, the slower the monolithic platform gets. The inevitable result is a slow DevOps cycle, which makes it harder for swift updates to be executed.

Heavy testing required: Along with being time-burdened, the monolithic platform also bears a high potential for system failure if the business owner wants new features. As a result, all updates need to be carefully tested, requiring more manpower and time to undergo all of the testing necessary to make sure nothing goes wrong.

In short, traditional eCommerce delays innovation.

Headless eCommerce

Headless commerce happens because businesses need commerce functionality. With this innovation, brands can deliver API-driven experiences through a CMS, DXP, application, device, or custom frontend with prestigious platforms such as BigCommerce powering your commerce engine.

Headless commerce indeed enables brands to integrate even the most complex commerce requirements with beautiful work - they don't have to compromise content to combine it with agile, flexible eCommerce.

In the next part, let’s have a closer look at its benefits as well as drawbacks.

Benefits of headless commerce for online merchants

Benefits of headless commerce for online merchants

Headless commerce has a lot of benefits

Headless truly opens up a world of possibilities for those hoping to make a name in the digital-first and consumer-centric world we are living in now. There are truly no limitations to the customizations in one’s platform.

Advanced technologies

Without the burden of outdated legacy systems, brands can test new technology to create ground-breaking visionary and fast websites in a headless environment. Thanks to the separation between the front-end and back-end, confines-bound developers of a traditional CMS are now way in the past.

Headless allows more legibility in content delivery as it lets users connect to a CMS, DXP, or Internet of Things device (IoT) and even swap out the front-end without affecting the back-end operations.

Easy extension 

In a headless environment, a platform can be easily extended to new channels, devices, and customers. Multiple front-ends can be connected to the same backend, enabling users to manage multiple user experiences across multiple devices without making a mess of different systems.

Effective integration

Headless eCommerce platforms control API’s power and agility so perfectly that businesses can create a tech stack unique to their business. In fact, the headless, API-first platforms enable a “best-of-breed” technology strategy, which allows users to create their own “virtual suite” of best-in-class software. Businesses can also switch applications out upon requirement.

Flexibility and familiarity

Headless gives you the opportunity to create the eCommerce site of your dreams. It enables businesses to opt for the platform they think works best for their online store, while also working with the front-end of their choice, be it a CMS, a DXP, a PWA, or a custom solution. 

What does all of this mean? If your dedicated team or internal development team has a certain technology or programming language they’re comfortable working with, headless allows them to keep what works with their workflow, meanwhile streamlining their processes and developing efficiencies.

Higher conversion rates and lower customer acquisition costs

Paid advertising opens the funnels for businesses to find more customers, but at the same time increases customer acquisition costs. Headless commerce solves this pain point by enabling brands to use content or experience-led strategies to draw in organic traffic instead of relying on paid advertising. The better thing is, while opening more gates for organic visitors, its dynamic and smooth customer experiences also help increase conversion rates.

Minimize the total cost of ownership

Normally, on-premise solutions are sold in core-based licenses forms, which, in the long run, has been causing many problems for scale. Why? As businesses grow over the year, technology has taken quite significant leaps, too. This means more licenses to be bought, and more changes to the core made by software vendors in each new version released.

Businesses wanting to take advantage of these upgrades need to constantly review and rewrite parts of their custom code to make sure it works with the new version. With headless commerce, these worries just fly over the heads.

Drawbacks of headless commerce for online merchants

Seeming ideal, but headless commerce platforms have two key issues that need addressing. Business owners also need to evaluate their digital transformation plan carefully based on: 

Ongoing costs

Headless commerce platforms do not provide users with a front-end, which means your IT department will have to build one on its own. On one hand, this is great because it enables developers to build front-ends bespoke for each device and touchpoint. But on the other hand, having your teams build templates and user interfaces from scratch is very time-consuming and costly. Developers will also need to troubleshoot their own front-end creations, leading to ongoing costs beyond the initial build.
SmartOSC solves these problems by offering you a great pool of IT talents with 1000+ successful projects and 15+ years in eCommerce focus. See how we help customers leverage technology courses and pricing policy HERE

Marketer isolation 

The other main drawback is that marketer isolation. This means your IT team is the only ones to know how to launch landing pages and content on different devices. Because a pure headless commerce system offers no front-end presentation layer, marketers can no longer:

  • Produce content in a WYSIWYG environment
  • Preview to see what it will look like on different devices or screen
  • Quickly create and publish content independently 

For many companies, their internal IT department has some of the highest turnover rates, which can cause disruption in IT support as well as marketing activities. However, this kind of drawbacks can be solved easily by choosing a third vendor to take care of all the managed work for you.

Headless commerce uses cases

With all these headless commerce pros and cons, it is no doubt that headless is all the rage now in the eCommerce world. We can name some of the best uses cases here:

Magento Commerce 

Magento Commerce is the best headless eCommerce platforms for analytics and data visualization

SmartOSC has been a partner with Magento for 15+ years and has empowered 500+ merchants to solidify the control of their system's resources 

Magento Commerce is named among the best headless eCommerce platforms for analytics and data visualization. It also allows developers to deliver tailor-made applications with a high level of customization based on the customer’s needs. 

Customer personalization: Magento encourages customer personalization by supporting A/B tests/ experimentations. Its systems are all divided, preventing the risks of operations from disturbing each other. The separated architecture facilitates new features and integrations quickly.

Inventory management: Its inventory management features let business owners accurately track inventory levels across different places such as warehouses, stores, dropshippers, and more. It also integrates a live count of saleable stock per source, and per product.

Analytics and data visualization: Magento Commerce is famous for its data studio as the tool’s analytics dashboard allows you to visualize key data points in dynamic scatter and bubble charts. This means marketers can export data directly to people’s inboxes, get quick average order value insights and other important data, such as lifetime value, retention rates, and more.

SmartOSC has been a partner with Magento for 15+ years and has empowered 500+ merchants to solidify the control of their system's resources. 

See more of our Magento capabilities.

Sitecore

sitecore-logo_red_RGB_large_600x135_transparent

SmartOSC is a Gold Solution Partner of Sitecore

Even though Sitecore has never marketed itself as “headless,” they have always separated content from presentation since well before “headless” was even a term.

But how is Sitecore a headless eCommerce platform? In the first place, Sitecore has been storing content as small objects while their layout engine places those in a web presentation format. So, when a marketer changes some web content in Sitecore, those changes will automatically propagate across any channel on which you’ve called or reused those content objects. For example, a mobile app developer who uses this content to make an app for your business!

SmartOSC has attained many achievements in our 4+ years with Sitecore. From being the Gold Solution Partner of Sitecore to many awards in 2018 and 2020, we are here to provide a smarter and personalized customer journey based on its Experience Platform and solid Commerce capabilities.

See more of our Sitecore capabilities.

BigCommerce 

BigCommerce-logo-dark

SmartOSC offers extensive development and strategic knowledge that will equip merchants with the right direction and capabilities to scale using BigCommerce

BigCommerce is named the best headless eCommerce WordPress Plugin. In fact, BigCommerce really lives up to its name, securing the leader position in the eCommerce space. 

All-in-one solution: This headless platform comes with full-service features covering everything an eCommerce business needs, from product listing, customer segmentation, payment processing, cart recovery, and so on. The site editor lets you easily edit and customize the platform according to your brand language.

Agility: BigCommerce’s headless eCommerce features allow users to create and run multiple stores simultaneously across various front-end solutions from a single BigCommerce account.

Hiccup-free experience: BigCommerce has a tailor-made WordPress Plugin that’s worth mentioning. It provides a smooth experience without slowing down the site. 

SmartOSC offers extensive development and strategic knowledge that will equip merchants with the right direction and capabilities to scale using BigCommerce. 

See more of our BigCommerce capability

Shopify 

shopify

SmartOSC is the pioneer Shopify Plus partner and currently the largest Shopify Plus agency in Southeast Asia

If you are seeking a top headless eCommerce platform with always-on availability, Shopify Plus may be the answer to your quest. This is the headless eCommerce platform that provides total creative control across all touchpoints to deliver a cohesive customer experience. 

Site-performance speed: Shopify helps speed up a site’s speed with a web app that reacts like a native mobile app. Apart from that, you can integrate all the systems involved in your business like ERP, PIM, CRM, CMS, and design frameworks.

Analytics and data visualization: Shopify Plus includes inventory tracking, exporting/importing inventory via CSV files, and other crucial tasks. Its analytics allow business owners to track conversions, average order value, store visits, and other data.

SmartOSC is the pioneer Shopify Plus partner and currently the largest Shopify Plus agency in Southeast Asia. We offer fast go-to-market solutions, helping brands and retailers to launch and grow their online businesses rapidly and sustainably.

See more of our Shopify Plus capability

Conclusion

While monolithic platforms are now restricting many of the fast-moving innovations that modern retail requires, many companies are still not ready to step out of their comfort zones to make a difference in their business.

If this article reaches you well, and you are considering a switch from the outdated monolith to headless commerce, SmartOSC would love to partner with you through your digital transformation journey. Contact us for further information, or read more about our capabilities and industrial authority with SmartOSC whitepapers.

 
 
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