Blog Post - Hugh Fletcher, Sep 8 2020

IT and Digital leaders need to align on eCommerce strategy. Here’s why

IT and Digital leaders need to align on eCommerce strategy. Here’s why

The unprecedented events of 2020 have had a profound impact on commerce. In years to come, it already seems likely that we will look back on the COVID-19 pandemic as a watershed moment which, among many other things, shifted patterns of consumption irrevocably.

The surge in demand for digital shopping triggered by lockdowns and social distancing has been well documented. For many businesses, this has required them to scale up their digital capabilities at speed. But in the longer term, a more profound effect is likely to be the way it accelerates the evolution of eCommerce, both in terms of how people use it and the technology deployed to meet shoppers’ expectations.

That has created a new onus on IT and commerce leaders coming together within an organisation to make sure their visions for eCommerce are in sync. The ability to future-proof capabilities in the face of shifting consumer trends and technological innovations depends on it.

Yet in our new report Headless, Microservices and the Future of Commerce Platforms, we found clear evidence that many enterprises still have a way to go in making sure their IT and commerce departments are singing from the same hymn sheet when it comes to the technology underpinning their digital estate.

Changing habits, changing technologies

Digital commerce has been undergoing a shift in emphasis away from transactions towards experiences for some time now. As the number of digital channels has multiplied steadily over the past decade or so, the traditional linear ‘funnel’ model of how customers pass from discovery through to purchase simply no longer reflect the way people actually shop.

We know from our Future Shopper surveys into online consumer behaviour that the way people jump across vendors, channels and devices nowadays to fulfil their inspiration, search and purchasing needs forms a complex web of interactions. Brands and retailers therefore now need commerce platforms that are agile and dynamic enough to connect a wide variety of experiences, interactions and shopping journeys across multiple channels - seamlessly, consistently and with an unwavering commitment to quality.

Commerce platform technology has evolved in line with these shifting demands. In place of the self-contained, monolithic architectures of the past that proved difficult to adapt and scale, we are now seeing approaches like API-first, Cloud Native, Headless and Microservices dominating the development landscape. Taken together, these approaches represent a loosening of the joints that hold the different moving parts of a commerce platform together. The benefits include easier customisation, the ability to embrace innovation at speed, open-ended scalability, centralised control of multi-faceted assets and cost efficiency.

If COVID-19 has pushed brands and retailers to beef up their digital commerce offerings in response to rising demand, it has also created a new emphasis on adopting these kinds of modern, agile commerce platform technologies. In our report, we found a strong consensus agreeing this was necessary - more than half of our survey respondents (57%) said they felt their current commerce platform would only be fit for purpose for another 12 months or less. An even more convincing majority, meanwhile, felt new platform technologies were the right fit for upgrading their capabilities - 67%, for example, said Microservices would benefit them.

Yet despite so many professionals in the industry recognising the direction of travel when it comes to platform technology trends, we also found evidence of a gap between acknowledgement and plans to actually adopt. A stubborn quarter or so of people we spoke to said their organisation had no plans to adopt Microservices, Headless or any other form of API-first, Cloud-native technology into their commerce platform within the next 12 months.

Given the speed of technological evolution and the way that the coronavirus has accelerated the use of digital retail, we believe a significant number of organisations therefore risk being left behind when it comes to supporting the kind of engaging, dynamic omnichannel experiences which are becoming the standard across commerce.

What industry insiders are saying

The findings of our survey of more than 400 senior leaders occupying a variety of roles in organisations across the UK and US suggests a number of possible reasons for this hesitation. One of them is a lack of alignment between Heads of IT and Heads of Digital / eCommerce in their views on the role of new platform technology, what it can bring to their organisation, and ultimately what their priorities are for their commerce platform.

For example, our survey results showed a considerable gap in how different professionals rated their understanding of technologies like Headless and Microservices. As you might expect, 37% of Heads of IT rated their understanding as strong, versus 18% of Heads of Digital and eCommerce. Similarly, 41% of Heads of IT and CIOs were very confident in their organisation’s abilities to work with these technologies right away, versus just 19% of their colleagues in digital and eCommerce departments. Perhaps most revealingly, more than 1 in 3 tech leads (32%) felt Headless, Microservices and the rest would be a good fit for their business right away, versus just 1 in 5 digital / eCommerce heads (20%).

Elsewhere, we discovered that IT pros on the whole felt that the need to upgrade their current commerce platform was more pressing than Digital / eCommerce leaders - 64% said it would need replacing within 12 months versus 49% of commerce colleagues. We also found clear differences in the reasons why different departments felt an upgrade would be necessary, and what they wanted to get out of it. The top benefit of updating their platform offered by CIOs was the ability to develop a more bespoke solution, while heads of digital / eCommerce want a solution that makes better use of customer data.

Heads of IT and CIOs were also more clear about the type of technology they wanted to see in their new platforms. A comprehensive 89% stated they planned to have some form of API-first solution in place within 12 months, versus 62% of Heads of Digital / eCommerce. On the other hand, IT leaders expressed more concern over the potential complexity of Microservices (68%) than digital / eCommerce leads (47%), perhaps a reflection of the formers’ greater familiarity with the technology.

In some respects, these differences in views on commerce platform solutions are completely understandable. Digital commerce does after all straddle IT and business functions, drawing people with different expertise and professional backgrounds together. This makes a certain degree of divergence in expectations and priorities inevitable and, particularly when it comes to the adoption of new technologies, opens the door for certain things to be lost in translation.

What strikes the IT side as clear and obvious benefits of Microservices, Headless, API-first and the rest, for example, might be so technical that they fail to even register on the radar of digital and commerce leads.

But this only underlines the pressing need for the two sides to work hard at coming together to find common ground. With digital now right at the centre of mainstream retail strategy, it is time for the technical and operational sides to emerge from their silos. For the very best digital commerce operations around the globe, the push for world-class CX drives innovation in technology, and technology delivers world-class CX. In other words, the two sides, operational and technical, work in perfect harmony to deliver key strategic goals.

The open-ended agility of API-first platform approaches like Headless and Microservices help to make this integration of IT and commerce objectives possible. But to take advantage of it, organisations also need to make sure their IT and commerce teams are on the same page when it comes to how these technologies can work for them.

You can read more about the commerce platform preferences, plans and points of difference among UK’s IT and Digital leaders in the report “Headless, Microservices and the Future of Commerce Platforms”. This research-backed paper also includes a review of the leading modern architecture technologies and approaches, and the steps to take to adopt them.

Download Headless & Microservices Report