Players in the ecommerce industry constantly deal with a “keep up with the customer or get stuck in the past” situation. They strive to stay atop the dynamic market changes while simultaneously increasing their own efficiency and profits. But legacy ecommerce architecture and subsequent lack of operational agility prevent companies from finding the perfect balance between customer satisfaction and profitability.
A game-changer appears to be right beneath our noses. Retailers can increase revenue, remove the friction between marketing and IT teams, and improve customer experience with headless commerce architecture.
Headless is a number one trend in the world of retail, according to 52% of digital agencies and 46% of merchants who participated in the 2021 Global Headless Report. So what makes headless ecommerce such a promising technology vector? Let’s dig in!
- What is Headless Commerce?
- Why Leading Retailers Choose to Go Headless
What is Headless Commerce?
Headless commerce, also known as composable commerce, is a technological architecture layout where the user-facing store components are separate from the backend and transactional functionality. This allows altering visual interface(s) without making server-side changes (heavy coding).
Headless stands for the H in MACH — a modular IT architecture that consists of microservices, APIs, cloud, and headless. These technology principles underpin best-in-class technology platforms.
Headless architecture allows you to have multiple frontend layers attached to a unified backend, so you can rapidly bring new campaigns to multiple sales channels — mobile, web, smart devices, or self-service kiosks — without worrying about server-side code. Or, as BigCommerce puts it: have a “swiss army knife of customer-facing tools with a single commerce platform at the backend.”
Headless architecture on BigCommerce
An ecommerce platform generally consists of three layers: the frontend, the backend + APIs.
You can purchase the total package from a SaaS provider or hire a development team to create a custom ecommerce solution.
But, let’s say, you later need more design templates and UI capabilities than those offered by your SaaS provider. There is still an option of building the required functionality from scratch, but it’s costly and time-consuming. And you need that campaign page/VR-powered page/mobile app as soon as possible.
That’s when headless comes in. In this case:
- An open SaaS provider such as BigCommerce, supplies your store backend. Their ecommerce platform has ready-made features to manage orders, product catalogs, hosting, security and so on.
- Then you can select different frontend frameworks (instead of using standard store templates) and connect everything to the BigCommerce-handled backend.
Headless architecture lets you achieve maximum flexibility in terms of digital store design and development. This is something that monolith systems often lack.
How Headless Commerce Differs From Monolithic Architecture
By design server-side components and presentation components are tightly coupled in monolithic ecommerce platforms. Because of this, updating any user interface will likely require both validation and changes on the backend side.
For instance, if you want to change the grid layout of a product page you can mess up the performance of other features such as the checkout page or shopping cart. To make a minor change in design, you need to engage both frontend and backend IT developers to make sure other parts of the app won’t go down.
Since online shopping was mainly desktop-based, few merchants were bothered by this rigidness. However, as people now shop through multiple channels (approx. 36% of offline sales are driven digitally) and expect stellar CX, monolith architecture has become a hindrance to growth.
Let’s check, how headless compares to monolith architecture.
Headless vs Monolith Architecture
Why Leading Retailers Choose to Go Headless
In 2021, a third of merchants said they plan to go headless by the middle of 2022, and another third plan to go headless before the end of this year.
Yes, store migration is a huge undertaking. But the dynamic nature of consumers’ demands will sooner or later force online retailers to go from a monolithic architecture to headless. And if a company aspires to be a leader in retail, it should be in a “sooner” team. Or else you risk losing the market share to more agile, tech-oriented players.
The transition to headless commerce presents an enormous revenue opportunity, creative freedom, and other benefits you should not miss out on:
1. Better Customer Experience (CX)
In retail, the customer experience is a crucial competitive advantage. Salesforce reports that 84% of customers value customer satisfaction as much as the products and services of a company.
Consumers want their favorite brands to deliver personalized experiences, provide exceptional customer service, and constantly exceed their expectations. Per McKinsey 2020 report, 80% of surveyed consumers look for personalization from retailers. And according to the 2021 PWC report, 39% of customers want brands to always meet their needs and 38% expect customer service to be of high quality.
Headless takes the CX to the next level as it enables changing the design on a whim, tailoring pages to dynamic user expectations, improving navigation and consistency of design between the channels, etc.
For example, Burrow, a furniture retailer, opted for BigCommerce specifically because it offers headless. They chose to combine a custom CMS with the BigCommerce backend. By using a custom solution Burrow created unique shopping experiences across various channels, increased website performance, and brought customized designs to new marketing campaigns. This UX creative freedom resulted in a 30% conversion rate increase for Burrow.
2. Omnichannel retail
Over 60-70% of customers now shop through multiple channels – in-store and online. Yet, large brands are stepping up and investing in other platforms that combine the advantages of in-store and online shopping, such as self-service kiosks and live commerce. For instance, companies see a 20% rise in younger customers when they use live commerce.
As brands adopt new channels, they must also maintain their brand identity and keep the same level of customer experience. Customers want to prioritize great experiences at every touchpoint be it your website or a smart fridge interface. And that’s where headless architecture proves to be helpful.
Headless allows design consistency and content optimization tailored to each channel’s requirements. For instance, for mobile devices, the main buttons need to be bigger and for kiosks, there should be no long texts so as not to create queues. Headless enables you to delight users with a custom brand-tailored presentation layer on each channel and at the same time aggregate and process retail transactions from multiple channels into one backend system.
3. Speed to Market and Faster Growth
The ecommerce market grew on steroids in 2020/21 and is nowhere close to cooling off in 2022. This year, worldwide ecommerce sales will exceed $5 trillion for the first time. Such rapid sector growth means increasing competition. So if you want to dominate a customer segment or a new market, you have to move at cruising speed.
With headless, you can expand operations to new channels and markets faster. Here’s how:
- Headless architecture means that you are using backend features (core commerce capabilities) out of the box from your SaaS provider like BigCommerce. And only develop custom frontend. This speeds up the development process.
- With headless, you can cherry-pick and connect the best-of-breed frontend tools to gain the extra features you need (e.g., AR-powered landing pages). You can create different designs or use specific tools for each channel’s frontend layer
- Headless lets marketing teams create custom content and alter the page design without relying on IT.
With access to core commerce features and rapid interaction speed, you can rapidly expand to new channels and markets (ahead of your competitors).
4. Best-of-Breed Technology and APIs
Headless architecture relies heavily on Application Programming Interfaces (APIs). APIs are like ‘glue’. They help you connect different frontend frameworks, CMSs, DXPs, and PWAs to your backend (ecommerce platform).
In monolith systems, developers were forced to use the same programming languages or a set number of supported frontend frameworks to develop custom designs. Or build things from scratch, which is always more expensive. Headless changed that.
Because headless architecture assumes using ‘composable blocks’ (microservices and APIs), you have the ability to cherry-pick and easily adopt best-of-breed frontend tools with ready-made solutions you need. At least 75% of customers now expect brands to embrace new technologies to improve their CX. Headless architecture gives you the room and agility to do so.
5. Stable Operations
Because you have a separate frontend and backend, you can adjust each without disrupting the other. Thus, your developers can optimize backend processes (e.g., add new integrations, maximize speed, improve security, scale the application easily) without worrying about the frontend.
For instance, when The Good and the Beautiful couldn’t scale their ecommerce platform any further, they chose to migrate to headless architecture on BigCommerce. By decoupling the frontend from the backend, the retailer managed to increase sales and improve order and shipment fulfillment on the backend. On the front, they’ve refreshed their design and connected WordPress CMS to publish more educational and promotional content for customers. Post-migration, the company saw a 72% increase in conversion rate, a 358% increase in orders and a 322% increase in revenue.
Furthermore, with headless, the marketing team can use page builders without calling up the IT department. Burrow, for example, has been able to focus more on marketing since headless gave teams autonomous control over the site without relying on code. In fact, reduced friction between teams is the reason why 72% of merchants are planning to use headless architecture in the future.
Online retail is constantly evolving and giving retailers new ways to win customers. Whether a brand takes advantage of these ways or stays steadfast depends on its ability to innovate and change.
Often, it is leaders who capitalize on changes. According to McKinsey, 50 percent of companies with the top 10 percent revenue are more successful at testing ideas and changing products, services, and how they do business than their competitors.
In the race to win the customers, winners are those who make bold decisions to innovate just in time. Be amongst the front-runners.