Digital commerce is rapidly evolving to keep up with the ever-growing needs of customers. New capabilities such as alternate payment methods, voice-based search and the like are becoming mainstream very quick. Organizations need to rapidly evolve their offerings to keep pace with customer expectations or risk losing customers (and revenue) to competitors who are quick to adapt to give the customers what they want. This rapid change however is a massive opportunity for organizations as it allows them to evolve and define their future. SAP solutions such as SAP Commerce Cloud, which have been trusted for decades by digital commerce organizations to bring them into the era of online, have evolved to help organizations unlock the potential of this ever-evolving commerce capability set.
In recent years, many organizations have realized that a monolithic approach to commerce solutions—where front-end and back-end commerce capabilities are combined as a single system simply cannot provide the flexibility and speed to market required in today’s dynamic business environment. For example, do you want to enhance your online store and deliver a more powerful customer experience by integrating a third-party content management system or want to accelerate time to market on features reusing microservices which you have already invested building in the past? Good luck making these changes quickly on a monolithic commerce application.
As monolithic commerce systems have shown their limitations, “headless” commerce has emerged as a potentially stronger option for organizations aiming to achieve nimbleness in their commerce operations. Headless commerce allows organizations to use an API-based approach that decouples front-end systems, commerce services, and back-end systems—providing improved flexibility in reusing common services and greater agility to deploy features at scale. Taking it a step further, if your organization relies on SAP solutions, there is now an opportunity for even greater flexibility with ‘composable’ commerce.
More flexible than headless commerce, a composable commerce approach does more than decouple your front-end and back-end systems. It allows you to select and integrate commerce capabilities in a “building blocks” fashion—adding or subtracting capabilities faster using microservices, connecting to standard SAP solutions through APIs and integrating with 3rd party partner solutions via connectors, to suit specific or evolving needs. This means you can take advantage of a wider choice of individualized solutions and vendors—for a full range of needs covering product information management (PIM), content management, search, carts, checkout experience, and more.
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Peering into the future of commerce
SAP continues to evolve its solutions for the future of composable commerce with new SAP Commerce Cloud functionality that supports greater flexibility for integrating microservices, integration with SAP and non-SAP solutions via APIs and composing commerce on your own terms. In the digital age, businesses have varying needs based on their size, customer base, product range and growth strategies. SAP Commerce Cloud steps in, allowing businesses to select, integrate and orchestrate different components or modules that fit their exact requirements. This could mean integrating a specific payment gateway, incorporating unique customer experience tools, or leveraging a particular search solution. It’s about having the freedom and flexibility to define your commerce strategy without technological constraints, ensuring the technology serves the business strategy and not the other way around. For many organizations—especially if you rely on monolithic commerce solutions—the big question is, “How can we effectively embrace composable commerce and prepare for the future of commerce?”
To answer that question in a meaningful way, you will first need to answer questions in other important areas. Here are a few key questions that can help shape your composable commerce journey with SAP solutions.
What does transformation look like?
Whether you're moving to SAP S/4HANA, adopting cloud solutions, digitizing processes, or embracing new digital commerce capabilities, if your business relies on SAP solutions, you are already undergoing a transformation. With SAP Commerce Cloud and composable commerce, you can make an even bigger impact to your organization’s transformation—and you can do it on your own terms.
Your organization may have an opportunity for a true greenfield transformation, moving to composable commerce across the entire business. Or, if a brownfield approach is important where you are incrementally and selectively enhancing your capabilities, you can modernize your tech stack while deploying composable commerce architectures and microservices where they fit best or where they can make the greatest impact. Whether you choose to be “all in” on composable commerce as part of a greenfield transformation or take a more measured approach with a brownfield transformation, you should understand that more innovation and more opportunity lies ahead. Vendors will continue to bring forward new commerce solutions and microservices, creating more possibilities for enhancing and optimizing your digital commerce capabilities. With a well-defined composable commerce architecture and strategy from get-go, you will be able to integrate these new technologies quickly—and thus innovate faster and realize business value sooner.
Amid all the technological change, it is important not to lose sight of the real transformation at play. Ultimately, a composable commerce approach allows you to take your customers’ experience beyond the transaction. By flexibly deploying microservices and APIs that support deeper A.I. driven personalization, ease of engagement, and proactive customer service—you can make it more human and elevate the customer experience across all touchpoints.
Making the move to composable commerce can also support your organization’s transformation to a complete built-to-evolve enterprise (what we at Deloitte call the Kinetic Enterprise™) enabled by clean ERP, intelligent technologies, responsive cloud solutions, and an inclusive ecosystem of services. Deloitte’s Lead-to-Loyalty offering is a prime example of the Kinetic Enterprise in action—bringing together SAP S/4HANA, SAP customer experience cloud solutions, and other intelligent SAP technologies to create a flexible, unified ecosystem for connecting with your customers across touchpoints—integrating your customer strategy, advertising, marketing, commerce, sales, and service processes.
How should my organization think about risk?
Business users can be risk-averse to the change that commerce requires. There may be concerns that a pivot to composable commerce will take too much time and effort, or your organization may simply want to move to new commerce platform that minimizes disruption for the enterprise. While the costs of pivoting to composable commerce could be high for some companies, the benefits of flexibility and speed of innovation should far outweigh those costs. Business users and IT departments can collaboratively leverage composable commerce in the enterprise, enhancing flexibility and scalability in operations. By focusing on value drivers like return on investment (ROI) through increased reusability and streamlining business processes, they can not only boost profitability but also improve customer experiences. The future of commerce will be composable—and as evident in SAP’s evolution of SAP Commerce Cloud, the vendor ecosystem continues to build toward that vision. Organizations that do not move quickly to embrace composable commerce could find themselves at a competitive disadvantage and at risk being left behind as competitors offer new digital commerce capabilities at touchpoints across the lead-to-loyalty spectrum.
What skillsets will my organization need to fully embrace composable commerce?
While SAP Commerce Cloud provides a foundation for composable commerce, your organization will need talent that can take full advantage of the cloud-native solution. Getting into a “cloud commerce” mindset is just the beginning. With SAP Commerce Cloud, your organization will have an opportunity to leverage the best of SAP’s Business Technology Platform (BTP) to create and integrate microservices, leverage out of the box integration to SAP S/4, CPQ, CX suite of products, analytical tools, intelligent automation, and other innovative capabilities including integrations with 3rd party vendors to leverage best of the breed solution for your SAP Commerce needs. That opportunity means you will need individuals on your team who understand how to unlock the value with cloud technologies.
How can my organization create greater efficiency and impact for digital commerce?
With the ability to add or remove capabilities based on business needs, with low TCO, composable commerce with SAP Commerce Cloud will automatically open a door to greater commerce flexibility for your organization. That flexibility inherently brings greater functionality, but your organization can and should do more. You should develop a plan for how your organization will build reusable components that can extend functionality in other areas. For example, if you build a payment integration service as part of the consumer online ordering experience, you should architect it in a way to use that same component for use by customer service, point-of-sale, and returns use cases. The same goes for PIM functionality, the microservice built for PIM during a commerce implementation should be readily usable in configure-price-quote (CPQ), product content syndication, digital shelf and similar use cases. The “building blocks” nature of composable commerce means you can use components more effectively, in more parts of your business, to extend their impact.
Assembling a new vision for commerce
The future of commerce will continue to evolve. But no matter what form that future takes, composable commerce helps create a flexible foundation that allow organizations to quickly pivot to new realities. Organizations that lack a clear strategy for composable commerce may find themselves playing catch-up as their peers and partners gain momentum.
The good news is that implementing composable commerce, in part or in full, can become easier as SAP and other vendors bring forward enabling solutions and as your organization continues to digitally transform on all fronts—including core ERP, business processes, data landscape, and human experience.
Ready to start building a new vision for commerce? Contact SAP@deloitte.com to get additional insights, schedule a demo of composable commerce capabilities, or discuss a specific challenge your organization is facing.