Global retail and wholesale companies are changing the technology that runs commerce:
- At the end of 2020, more than one-third of global retail and wholesale companies told us they were evaluating or planning to replace their commerce solution. This is a huge percentage of the market, given the commitment, timeline, and cost of replatforming.
- Additionally, over half of global retail/wholesale businesses plan to replace their commerce solutions with software as a service (SaaS) within two years — or already have — and another one-fifth plan to at least complement their commerce tech with SaaS during the same time period.
- Nonetheless, more than one-quarter of global retailers and wholesalers surveyed still house their commerce solution on-premises. That number climbs closer to one-third if we look only at larger enterprises based in the US (presumably, those most likely to have started their e-commerce journey earlier).
There was a time when most commerce solutions for the largest, most serious digital retailers were either homegrown or served by one or two major providers. Those systems were powerhouses in their time, but they took at least a year to implement, were deeply embedded in back-office systems, and became increasingly customized “Franken-solutions” over time.
The Problem: Customized Legacy Tech Is Hard — And Costly — To Change
When businesses control and deeply customize legacy tech, they take on the responsibility for keeping the solution current – rather than leaving that responsibility with the solutions provider. This responsibility was hard enough when digital commerce was younger and consumer expectations were simpler. Today’s world, rife with supply chain emergencies, natural disasters, and pandemic responses, requires agility and adaptability that businesses cannot deliver with static, overly customized tech. Plus, modern technology, built for the cloud with API-first modularity, enables businesses that embrace it to adapt much faster.
Do Digital Businesses Want To Change It?
In this 3.5-minute video, I explain how we know that businesses want a change and what they’re doing about it:
So digital businesses are making the hard transition to modern commerce tech that will help them move faster in the future. But how are they doing it? The same way you would (proverbially) eat an elephant: one bite at a time. For a deeper dive, see our full Legacy Commerce Technology Faces Death By A Thousand Cuts report.
To speak with me about these changes, or for help figuring out how to move forward, do get in touch with me.