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eCommerce

Enterprise headless eCommerce: Should your organization make the switch?

Chris Powers
January 13th, 2021
12 MINUTE READ

The eCommerce industry continues to grow and evolve as brands seek to stay competitive in digital commerce. One way eCommerce companies are seeking to gain market share is by implementing a headless eCommerce architecture. In this environment, the front-end presentation layer of an eCommerce store is decoupled from its back-end.

This approach gives eCommerce businesses more freedom to deploy engaging front-end content and user experiences without having to make significant changes to the back-end codebase. This allows brands to quickly respond to shifting customer wants, needs, and desires to deploy front-end updates and changes that improve the overall shopping experience.

Once thought to be a strategy only conducive to startups, direct-to-consumer (DTC) brands, and other nimble eCommerce brands, more and more enterprises are embracing a headless commerce solution. Just like scrappy upstart brands, enterprises are enjoying the flexibility that the headless commerce approach allows. Enterprises can reap the benefits of creating more meaningful shopping experiences for their customers and building a true omnichannel marketing and sales strategy.

So what exactly is a headless eCommerce architecture, and how does it differ from a traditional eCommerce setup? How can enterprise eCommerce businesses harness the power of headless to boost conversions and grow sales? In this article, we’ll define headless eCommerce, explain how it attempts to solve the problems of traditional eCommerce architectures and outline the pros and cons of going headless. Then, we’ll discuss if a headless approach is right for your enterprise eCommerce business, and explain the benefits of adopting a headless strategy should your business decide to go that route.

What is headless eCommerce?

As mentioned above, headless eCommerce refers to an environment where the front-end presentation layer of an eCommerce system (“the head”) is decoupled from the back-end commerce functionality. When we talk about the presentation layer of an eCommerce architecture, we’re referring to all the customer-facing elements, like UX/UI, promotional content, social media eCommerce, Internet-of-Things (IoT), progressive web app (PWA) setups, and more. Essentially, the gateway through which your customers engage with and purchase your products.

Decoupling the front-end presentation layer from the back-end commerce layer means your front-end developers can focus exclusively on improving the presentation layer to offer superior customer interactions—without having to worry about the back end. The eCommerce back end, which handles things like inventory, order management, payment gateways, and shipping, communicates with the front end via application programming interface (API) calls. The front end can then be retooled for multiple different touchpoints, like IoT devices, mobile, progressive web apps (PWAs), and more using these API calls. 

The difference between traditional and headless eCommerce

A traditional eCommerce architecture operates as a monolith—or single pillar—meaning the entire structure is contained within one piece. Monolithic platforms incorporate multiple components into a single code base, and these components are used to complete a predefined set of tasks. These components typically include business logic, the database layer, and more. 

In the context of an eCommerce architecture, these individual components include back-end services that provide for the actual commerce, like product inventory management, payment authorization, shipping, and more. In a monolithic architecture, the front-end presentation layer is inextricably linked to the back-end commerce layers. This means that all changes made to the presentation layer must be replicated across the entire architecture. Simple content management tweaks, UX/UI changes, and more take significant development time and coordination between both front-end and back-end teams.

Traditional commerce architectures can only deliver content in established, templated forms, like through a website or a mobile app. There’s little room for flexibility to ensure other content forms or channels can successfully integrate with the back-end commerce layer. By separating the front-end and back-end layers, a headless eCommerce architecture provides for adaptability in commerce, ensuring an improved commerce experience across all touchpoints.

Alex Belding, the co-founder of WebriQ, writes:

“In fact, the entire concept of headless commerce is able to evolve and move with your business. By decoupling and decentralizing your website, you are able to bring in new technologies much easier than if constrained to a monolithic platform. You can bring in new and innovative payment systems, offer new experiences like AR/VR, and incorporate IoT commerce options.”

The benefits of headless eCommerce

Enterprises can be flexible too. Transitioning your business to headless eCommerce architecture can help your team quickly develop and deploy content—and utilize superior content management practices—to attract new customers and retain existing ones. 

Prioritize customer experience

In a headless setup, the decoupled front end integrates with the commerce platform’s back end through application programming interface (API) calls. With this approach, enterprise organizations have the freedom to experiment with different front-end designs and alterations without having to tack on extra development hours for the related back-end changes. An enterprise can get the most from its content management system (CMS) to tailor its front end to its customers’ unique wants and desires, without worrying about adjusting anything on the back end. Consistency is key; this approach also ensures that customers get a consistent experience across different devices and touchpoints when shopping.

Deploy updates swiftly

With a headless commerce architecture, enterprises can easily make changes to the front end without altering the background in a headless system. This means updates can be deployed much faster. Your front-end teams can make UX/UI improvements and other customer-facing changes quickly, helping your brand to stay competitive and up-to-date with the numerous technologies and devices your customers use to browse and shop.

Drive down customer acquisition cost (CAC)

Every day, competition in the eCommerce space intensifies. Consumers now have countless opportunities to engage with brands, browse products, and eventually make purchases. New-fangled, digital-first businesses are buying up ad space, trying to carve out a niche and step on competitors’ toes. Because of this, paid advertising costs are rising, meaning some eCommerce businesses are pursuing more organic methods to drive consumers to purchase their products.

With a headless approach, your content can easily be shifted and adjusted to meet your goals to drive organic traffic. Because your content is truly flexible, you can drive down your customer acquisition cost (CAC) and focus on your tailored customer experiences to increase conversion rate, boost sales, and grow revenue.

Going headless in the enterprise

Though enterprise eCommerce businesses are being asked to behave more and more like startups to stay competitive, the reality is that they have a whole host of priorities and concerns that can prevent them from being truly nimble and flexible. Startups are built to move fast, stop on a dime, and shift priorities at the drop of a hat. Enabled by cutting-edge technology and unburdened by layers of bureaucracy, eCommerce startups can afford to shift their approach and freely respond to the will of their customers-an advantage enterprises are rarely afforded.

Due to their age, size, and numerous other factors, eCommerce enterprise companies likely operate on legacy technologies. With multiple back-end systems and a singular code base, making adjustments to improve efficiency in eCommerce and adapt to customer wants and needs can mean a full-scale replatforming. 

But this is where headless eCommerce truly shines. With a decoupled front end, enterprises can utilize their existing back-end systems while having the freedom to make necessary changes to the presentation layer. Enterprise businesses can put APIs to work to communicate between the two layers, integrate touchpoints, and create a consistent customer journey. Even as enterprise organizations implement back-end changes to improve efficiencies, the customer-facing presentation layer is never altered. Significant updates without downtime become a reality, solving one of the biggest challenges to any enterprise software. Headless eCommerce offers enterprises something they rarely encounter: flexibility to innovate without having to implement costly-and time-consuming-new technologies. 

Improved data visibility

For enterprise companies, having accurate and timely data to monitor all aspects of their eCommerce operations is fundamental to their long-term success. Enterprises need full visibility into their eCommerce operations to ensure they are running efficiently and effectively. And it’s not just bottom-of-the-funnel data (i.e., conversion rate, sales, etc.) that’s essential. Enterprise businesses need data gleaned from every touchpoint consumers use to interact with their brand.

Due to its API-first nature, a headless eCommerce approach can gather data from all elements of the customer journey. Each API call can offer its own set of data, meaning enterprises can capture specific metrics based on each eCommerce channel, like social media. Enterprises can assign individual key performance indicators (KPIs) to each eCommerce channel and get a clearer picture of how they are performing beyond typical metrics like conversation rate. This data can give enterprises a picture of their reach, growth, customer engagement, and much more.

Omnichannel eCommerce

According to Aspect Software, businesses that adopt an omnichannel strategy achieve 91% greater year-over-year customer retention rates when compared to businesses that use more traditional sales and marketing strategies. Enterprise organizations seeking to capitalize on the omnichannel approach can see improved customer retention and revenue growth thanks to seamlessly connected eCommerce touchpoints.

Omnichannel eCommerce seeks to provide consumers with a consistent experience across touchpoints. By meeting your customers on their terms at their preferred touchpoints, you can provide them with the products they need, exactly when they need them. Omnichannel eCommerce succeeds by breaking down the dividers between individual eCommerce channels. The goal is to ensure your customers get the same tailored, branded experience from shopping on your site that they do from, say, your mobile application or social media channels. Aligning your sales and marketing strategies across channels creates a truly consistent brand experience—and lets your marketing team sleep easier at night.

A headless eCommerce architecture ensures a seamlessly integrated experience for consumers. This is important for enterprises that have a large customer base and a sizable brick-and-mortar footprint.

Take Walmart for example. A massive retail player and the go-to big box store for many shoppers, Walmart saw the inherent value in adopting a seamless, omnichannel approach to eCommerce years ago. 

Says CEO Doug McMillon:

“Our work starts and ends with the customer. Technology has changed customer expectations. Customers used to compare us with the store down the street; now they compare us with the best online shopping experience. And beyond retail, they compare us with every business they interact within their lives.”

To stay competitive and offer customers the Walmart experience they’re used to in the store, the company needed to embrace a technology-focused omnichannel strategy. This allows the retailer to create a seamless shopping experience, no matter what channel consumers use to make purchases.

“Ultimately, customers don’t care about what channel they’re shopping in, or about how we deliver them a product or service,” says McMillon. “They simply know they’re shopping with Walmart.”

The decoupled nature of headless eCommerce is extremely conducive to creating on-brand customer experiences across all consumer touchpoints. Enterprise businesses with a headless architecture can easily reap the benefits of omnichannel strategy-something businesses operating with a traditional, monolithic architecture cannot.

An enterprise headless success story

Numerous enterprises are at the forefront of the headless eCommerce revolution. Taking advantage of the decoupled architecture has helped these businesses continue to innovate, scale, and improve their overall customer experience. 

As mentioned above, Walmart was an early adopter of the headless approach for enterprise organizations. To create an improved online experience, Walmart decoupled its front end from its legacy, monolithic eCommerce back end, Oracle ATG, and has seen incredible success since. Prioritizing an intuitive, immersive, and flexible front-end design approach has helped Walmart to grow its eCommerce sales by 41%—enough to keep Amazon on its toes. 

Read more about companies that have successfully embraced the headless commerce strategy here.

Is headless right for my enterprise business?

Headless eCommerce’s benefits are numerous and well-documented. But when it comes to enterprise commerce, there’s not a one-size-fits-all solution. What works well for one company may not offer the same benefits to another. Many enterprises prefer the stability that a traditional, monolithic setup provides and would be wary of an architecture that depends so heavily on APIs. Additionally, enterprises are more likely to have both front-end and back-end developers on staff and therefore can make cross-platform changes readily and cheaply. However, some enterprises can certainly benefit from all that a decouple commerce architecture provides. Here are some factors to consider if you’re debating moving your enterprise to a headless eCommerce architecture.

Multiple brands

If your enterprise eCommerce portfolio features multiple companies, brands, or entities, you may be a good candidate for a headless eCommerce system. With multiple brands being managed using a single eCommerce platform back end, you could deploy a headless approach to create custom front-end experiences for each brand, while ensuring they connect to a singular application layer. This allows you to be flexible in how you present and display each brand, knowing that they interface with a single source for back-end eCommerce functionality.

Growth-stage eCommerce

If your enterprise-or one of its brands-is in a stage of rapid growth, a headless approach may be ideal. Being able to deploy bespoke content rapidly is invaluable to a growing brand seeking to establish market share. Things like promotions are crucial to luring new customers and retaining existing ones, so having the ability to deploy this type of content will set you apart from your competitors.

Front-end commitment

While a headless front end does offer its share of benefits in the form of flexibility and scalability, it is not without its downsides. Because a headless system migrates away from the monolithic architecture of traditional eCommerce, the front end will have to be built from scratch. This can take significant developer hours and incur sizable costs depending on the size of your business and your organization’s needs. It will also take dedicated resources to continuously manage and refine the front end as an entity separate from the back-end commerce layer, which can also add up to significant costs and development effort. If your organization is not prepared to fully invest in the front end as a modular component of its overall eCommerce effort and prefers the ease-of-use a monolithic solution provides-then a headless approach may not be best.

Implementing an enterprise headless solution

Switching to a headless commerce architecture at the enterprise level may seem like an arduous, time-consuming endeavor. If the idea has been proposed, your executive leadership team is probably asking the following questions:

  • What new technologies do I need to implement?
  • What elements of my current eCommerce tech stack will still work?
  • How do I ensure there is no downtime or outages with my eCommerce site as I make the switch?

Consider enlisting the help of an eCommerce development agency to help you reap the full benefits of a headless platform. At Codal, we’ve worked with numerous clients-many at the enterprise level-to build and deploy cutting-edge eCommerce solutions that boost conversion rates, grow sales, and increase customer retention and satisfaction.

Codal will review your pre-existing data and user journeys to contextualize our design and determine the ideal headless storefront, We’ll supplement this research with an audit of your current tech and data flow processes, working to understand all features and pain points on your current eCommerce platform, and what technologies we’ll enlist to solve them. Working with our extensive set of eCommerce technology partners, we’ll craft an enterprise-level headless solution that delivers. Talk to Codal today.

Chris Powers
AUTHOR

Chris Powers

Chris is a Content Marketing Specialist at Codal. With a background in journalism and marketing, Chris has written about a variety of tech topics, including open source, fintech, and cybersecurity. Chris loves taking on new challenges with just a pen, paper, and his brain.

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