The Core Reasons for a Digital Commerce Replatforming
When companies commit to a digital commerce replatforming, they start by looking for a vendor that will solve their pain points. Over the years, many B2B enterprises and upper mid-market companies have come to us for that very thing. So, as you can imagine, we have quite a few stories about the problems that companies encounter when trying to replatform.
Most of these fall into one of two categories:
1. Companies that are overly focused on their bottom line, at the expense of the customer experience.
2. Companies that seek to improve customer experience but struggle to identify the root cause of what’s holding them back.
> The first case is rather straightforward. It’s all about cutting cost.
Many companies use a static solution built on top of well-known brands that charge them a lot of money on a percentage of revenue (like Magento), or at a high-priced flat rate (like SAP Hybris).
Sometimes, a company will default into using a digital platform belonging to a larger parent company because it has common shareholders. The result is they end up paying too much for it.
These companies may not have given enough thought to improving the experience they deliver to customers. They don’t realize the threat from their more agile competitors and care only for their bottom lines. Rather than focus on delivering a better product, they simply look for a digital platform that is similar to what they know, but less expensive.
> The second case is much more interesting. Many companies have the right goals in mind that support the overall company business strategy yet can’t figure out how to articulate the issues with their current digital commerce platform.
This case applies to enterprises that have already realized that, by providing the best customer experience on the market, they can capture the market share from slower competitors.
For them, being agile is the answer.
To be agile, they know they have to adapt their requirements and customer experience on the fly. They want to work with a small technical team that can help deliver new services and improvements frequently. Fast and flexible are key. Yet when they try to be fast and flexible, they run into roadblocks.
And so, they come to us. “Feature development is too slow,” they’ll say. “It’s too risky to change this component,” “we can’t do what we want,” “the cost of innovation grows exponentially,” and so on. What they don’t yet realize is that no matter the symptom, the underlying disease is the same: a static digital platform.
What we also see is that the share of companies that try to solve the second problem is growing. The market still doesn’t realize the problem of running constant innovations in digital commerce. But as the competition pressure grows, more and more companies come to understand that having a static platform means they will lose the customer experience battle. According to Deloitte, this has already come for B2B companies.
At the same time, we at Virto Commerce see that agility is already defined by thought leaders in business consulting (McKinsey, Deloitte) as a critical factor for survival in a digital commerce world. So, I expect that more and more companies will switch their attention from how to pay less to how to create affordable development velocity for continuous customer experience modifications, so customers stay happy and loyal for longer.
