Comparing headless commerce with composable commerce
Technology
Ecommerce DXP

Headless Commerce vs Composable Commerce

Sep 08, 2022
Oshyn
Oshyn

While the ecommerce industry continued to thrive, some brands found it hard to adapt to consumer trends and global events throughout the pandemic. Even if their strategy was sound, their technology stack simply wasn’t flexible enough to enable quick pivots and agile campaigns.

Headless and composable commerce represent the evolution of digital commerce, enabling brands to deliver top-notch, multichannel, personalized, and future-proof commerce experiences.

This article aims to shed some light on the differences between these two modern digital commerce concepts and how retailers can adopt them.

The Rise of MACH and Composable Platforms

In an effort to stay flexible and innovative, many companies and retailers quickly realized their traditional ecommerce solutions could no longer suffice. They were severely limited in terms of customization, reliant on a single vendor, and lacked the agility to meet future digital channel demands.

These limitations sped up the adoption of headless and composable commerce solutions and MACH architecture. The key driving force behind these approaches is a desire to deliver better digital experiences across all channels — web, mobile, AR/VR, digital signage, email, etc.

MACH architecture — representing microservices-based, API-first, cloud-native, and headless — is a concept that aims to shift the ways brands build or select software solutions. It moves enterprises away from the slow, rigid nature of monolithic commerce platforms toward a modular API-first solution.

Sitecore’s recent acquisitions and integrations of SaaS-based solutions — Boxever, Four51, Moosend, and Reflektion — into their core offerings further drive home the importance of MACH.

In fact, Gartner recognizes this revolution, indicating that the future of applications is composable and any brand that seeks to deliver business-centric solutions that are future-proof should consider it.

What Is Headless Commerce?

Headless commerce works like other headless approaches by decoupling the presentation layer with all its different UI designs and frameworks from the backend data and logic containing product information, orders, etc.

An essential benefit of headless software lies in creating a distinctive interface and branding based solely on your company goals, using any programming language or a framework of choice.

Having your ecommerce data and logic stored in a headless commerce platform enables you to serve content to any digital touchpoint channel, anywhere in the world.

Do you want to deliver product content to an app, social media channel, email, or via augmented reality? Headless commerce is the solution for you.

What Is Composable Commerce?

Composable commerce is an extension of headless commerce, consisting of the integration of other third-party software components to form a robust, flexible, future-proof tech ecosystem. This is akin to a conductor in front of an orchestra rather than a single instrument.

Composable commerce consists of a range of other microservices-based SaaS solutions, which may include a content management system (CMS), analytics, customer relationship management (CRM), customer data platform (CDP), search functionality, and digital asset management (DAM), A/B testing, and more.

Adopting a composable commerce tech stack requires the adoption of a composable strategy. Brands should remain nimble, un-married to technology, and ready to change at a moment’s notice to respond to trends, expand into new markets, or conserve budget.

A Typical Composition of a Composable Commerce Tech Stack

A composable commerce solution consists of several best-of-breed services that integrate seamlessly with one another. In this way, it is quite similar to composable digital experience platforms (DXPs) — but with a finer focus on commerce experiences. These solutions can be from a single vendor, or from different vendors.

Small companies embarking on an ecommerce journey don’t have to adapt all the solutions on the list from the start. Instead, they should start with the solutions they need and scale up to include other solutions as their company grows.

Most enterprise companies already operate with some of these solutions. Even if the existing CRM or service isn’t API first, you can still build a composable strategy around it to make it work.

The following is an ideal composition of a composable commerce stack:

Ecommerce Platform

An ecommerce platform is central to any composable commerce architecture. It should offer a robust checkout process, payment processing, shopping cart, product information management (PIM), capabilities,, promotions engine, regional tax structures, multiple currency acceptance, RMA and returns, multi-destination shipments, and headless commerce functionality.

Example: Shopify, BigCommerce

CMS

A CMS is an essential part of any tech stack. Content is the centerpiece of your entire customer-facing site. While an ecommerce platform may provide content management capabilities, it’s not the most ideal.

An enterprise-grade CMS will enable you to leverage features such as WYSIWYG editing, drag and drop, content previews, personalization, analytics, multi-language and multi-site functionality, global content delivery networks (CDN), headless and multi-channel content delivery.

Read more: 10 Reasons Why a CMS is Important for Your Business

Customer Relationship Management (CRM)

Customer relationship management (CRM) is a software solution that enables retailers and brands to manage customer interactions and build strong customer relationships and engagement across their channels. They help brands nurture leads, boost sales, and increase retention.

In a way, a CRM replaces traditional spreadsheets and databases that companies often use to track customer data and interactions.

Example: HubSpot, Salesforce

Payment Integration

Every ecommerce shop has an integrated payment system that allows retailers to receive payment from customers across the globe or within a particular location. They are API-first payment gateways that enable faster and more personalized payment processes.

The beauty of leveraging these payment solutions is that you can always switch seamlessly to your preferred payment gateway.

Example: Stripe, PayPal

Shopping Cart

A shopping cart software plays an important role in managing an ecommerce store’s inventory, helping customers select, add, and remove products as they shop, calculating taxes, shipping costs, and running promotions. They are the backbone of any ecommerce business.

This software can also help in transmitting customer or product information to other composable commerce services such as an ERP, CDP, CRM, etc.

Example: Sam Cart, Ecwid

Promotions Engine

A promotions engine helps retailers and brands provide effective and personalized promotions and discounts across their ecommerce shops. Retailers using this software can include or exclude certain products from promotions, offer dynamic and conditional discounts, and provide location-based deals.

Example: Uniqodo, Qixol

Personalization Engine

A personalization engine helps businesses deliver customer-centric experiences that appeal to their unique and personal needs. Some of the personalized services can include a list of recommended products based on a customer’s purchase history, location, demography, or interests.

A personalization engine can be built around your CRM or first-party data, helping you to tailor content and products to your customers. Having this solution in your composable tech stack results in increased conversions, higher sales, and ultimately greater revenue.

Example: Ninetailed, Yieldify

Read more: 5 Reasons Why Personalization Matters

Customer Data Platform

A customer data platform helps retailers aggregate customer information across multiple sources into a single database. This solution is designed to provide a holistic view of customer journeys and interactions.

Since customer data is spread across many different channels and sources, a CDP helps to structure and organize the data for more effective marketing strategies and campaigns.

Example: Sitecore CDP, Segment

Analytics

Analytics is a core part of any tech stack—and a composable commerce stack is no exception. An analytics engine gathers and informs brands on the performance of their system and operations.

They can provide insight on your site traffic, bounce rate, amount of products in the cart, average time spent on a page, etc. An informed insight from your analytics engine will be essential in driving improvements for your ecommerce platform.

Example: Tableau, Looker

No ecommerce store or site is complete without the ever-present search bar. A site search engine helps to provide real-time dynamic search functionality across your entire website, ensuring customers can quickly sort through and access relevant information.

The site search solution includes features, such as search-as-you-type, synonyms, faceted search, typo-tolerance, full-text crawling, and indexing.

Example: Algolia, Yext

Email and Marketing Automation

Email and marketing automation tools help to ensure the successful management and execution of marketing campaigns. For instance, imagine having to send a personalized email newsletter to 500 recipients, it’s going to take a lot of time and effort.

Using data gathered in your CRM or CDP, these solutions help you reach greater audiences than you might if you were doing it manually. A marketing automation tool helps you efficiently nurture leads, and boost sales and conversions.

Example: Klayvio, Active Campaign

Digital Asset Management (DAM)

Digital asset management (DAM) is an API-first cloud-native solution that helps enterprises store media files and data such as images, videos, PDFs, and audio files, enabling faster accessibility and delivery across your channels.

Storing all media — especially video — on your database can considerably drive up your operating costs. A DAM can help you save costs on cloud storage, helping you store a high amount of media data at a low cost.

Example: Bynder, Canto

Why Enterprises Should Opt for Composable Commerce

A 2020 research conducted by Gartner revealed that enterprises will need to adopt a composable commerce future, “Application leaders responsible for digital commerce should prepare for a “composable” approach using packaged business capabilities to move toward future-proof digital commerce experiences.”

Here’s why you need to adopt a composable commerce solution:

  • Personalized experiences:Having a composable commerce architecture leads to enhanced personalization and better digital experiences for your website visitors. This helps to increase conversions and guides customers to make better purchasing decisions.
  • Highly flexible: With a composable and modular architecture, brands are agile enough to adapt to specific business needs by integrating or removing any best-of-breed services as needed.
  • Unique, branded journeys: Enterprises can leverage best-of-breed services to deliver distinctive customer journeys and interfaces that appeal to your customers. You can build custom application and commerce experiences using cutting-edge frameworks and technologies like AI, AR, and VR. Retailers no longer need to rely on platform themes and plugins.
  • Future-proof your ecommerce tech stack: The flexibility of a composable commerce platform helps you keep up with market demands and trends, making it easy to change and adapt to dynamic conditions.
  • Omnichannel delivery: The presence of customers and potential customers across a wide array of interfaces and touchpoints requires an omnichannel solution. A composable commerce platform helps create and deliver digital products and content to any channel or device at once.

Ensure Future-Proof Digital Experiences With MACH and Composable Commerce

For an enterprise company or retailer, composable commerce and MACH architecture give them the flexibility needed to adapt to today’s ever-evolving market. An advantage of having your digital shop built around a composable strategy is that you don’t have to integrate all services at once.

Instead, you can start with a headless commerce platform. With its API-first approach, you can subsequently integrate other services as the need arises. This means you can enable better-personalized experiences, deliver to global audiences, and generate more revenue.

In a bid to untangle its broken and outdated buyer’s journey that resulted in a poor conversion rate, Audio Digest sought out Oshyn — an established development agency — to help resolve the challenges.

Using Optimizely (formerly Episerver) B2B SaaS-based, API-first commerce platform, Oshyn was able to deliver a personalized and remarkable customer experience that included a unique interface design, promotions and discounts, and a seamless checkout process.

Want to know how Oshyn made this possible? Check out our case study.

Frequently Asked Questions

What is a headless commerce system?

Headless commerce decouples the client-side architecture containing the frontend interface from the backend logic and data.

What is the difference between headless commerce and composable commerce?

Headless commerce only handles the client-side logic of a commerce architecture while composable commerce extends this concept to include other API-first third party integrations—such as CMS, CRM, analytics, PIM, and more— to create a scalable, future-proof tech stack.

What is the composition of a composable commerce?

A composable commerce stack consists of different integrated components, some of which includes a commerce platform, CMS, analytics, A/B testing, search engine, marketing automation, CRM, CDP, and a payment gateway.

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