IBS Software’s Chris Branagan opens up the rapidly growing trend of headless commerce, and how the radical separation of front and back-end in e-commerce provides brands with the power to personalize content, tap into new revenue streams, and stay competitive in the digital age.
As the world becomes increasingly digital, companies are constantly seeking ways to improve their customer’s retail experiences to gain a competitive edge. In recent years, the use of technology has been key to transforming the customer experience, and now, headless commerce is emerging as the hottest trend that promises to deliver a new era of brand experience.
No longer just a buzzword, headless commerce is a rapidly growing trend that provides a fundamental shift in the way brands interact with their customers. Defined as the separation of the front-end and back-end of an ecommerce application, headless commerce allows brands to keep their back-end constant, but use APIs to work with multiple different applications, such as content management systems (CMS), and vendors to promote products as they see fit.
In other words, headless commerce gives brands control over their front-end – the all-important interaction with their buying audience and provides a smooth user experience. According to a recent survey conducted by Digital.com to investigate online shoppers' behavior when waiting for web pages to load, 25% of online shoppers will abandon a page that doesn't load within 4-6 seconds. The results underscore how in today's fast-paced world, time is a precious commodity, and online shoppers are no exception to this rule. If a website fails to deliver a seamless experience, customers won't hesitate to abandon it and explore other options.
This separation of back and front functions is a fairly dramatic departure from the status quo, where ecommerce platforms tie the front-end and back-end together, thereby restricting brands to the often-limited customization templates offered by their ecommerce platform. The result is a lack of control over the front-end, limiting the ability of brands to adapt the shopping experience to dynamically change the way they reach customers on emerging different channels, which inevitably leads to lower conversion rates.
From my perspective, there are three reasons why headless commerce will transform the brand experience:
- With consumer behavior changing at breakneck speed, brands that do not adapt to the different emerging channels face an existential threat to their business models: It's possible nowadays to achieve omnichannel commerce seamlessly – brands have the power to connect with customers on their preferred devices, whether it be a smartphone, laptop, tablet, or voice assistants such as Alexa or Siri. A study done in 2021 by the National Retail Federation (NRF) and Forrester reported that retailers who have strong omnichannel customer engagement strategies experience a 10% year-over-year increase in annual revenue, in comparison to a 3.4% increase for retailers that have weak omnichannel strategies.
- Adopting a headless architecture allows brands to transform the customer experience and deliver personalized content to the right people at the right time: In today's fast-paced business world, that agility is more important than ever before. This is why brands are embracing dynamic marketing to allow for greater flexibility in delivering personalized offers and promotions without disrupting the back-end systems. The ability to react quickly to trends and behaviors and bring in new features has become a game-changer; a study by Digital Commerce 360 and BigCommerce found that 67% of respondents believe that headless commerce improves time-to-market for new products. This means that organizations can bring their products and services to market faster, keeping up with their competition and meeting the demands of their customers.
- Headless architecture gives brands the freedom to tap into new revenue streams and optimize existing ones: According to a report by Accenture, companies that implement headless commerce see a 30% increase in revenue due to expanded product offerings and enhanced customer experience. For instance, a company can leverage the benefits of headless commerce to expand its retail options beyond devices and services to include complementary products like phone cases, screen protectors, and other accessories.
While the maturation of headless commerce into the MACH (Microservices, API-first, Cloud native, Headless) architecture approach has made it more accessible for brands to adopt due to the way it provides flexibility for businesses to build digital experiences, IT infrastructure still needs to take on more of a progressive approach to truly make the most out of headless commerce.
Only the businesses that are willing to recognize the limitations of their current set-up and are open to implementing change can fully reap the rewards that headless commerce offers. With the growth of ecommerce showing no signs of slowing down, it's clear that the brands that do embrace headless commerce will be well-positioned to succeed in the digital age.
