Skip to Main Content

Feb 20, 2024 | 4 minute read

Breaking Down BCG’s 4 Winning Ingredients to Accelerate eCommerce Growth

What separates “winning” e-commerce brands from the laggards? In late 2023, BCG surveyed more than 800 retail and CPG companies to find out. The winning businesses they surveyed didn’t experience a slowdown after the 2020 pandemic surge —reporting post-surge (2021–2022) growth above 30% per year. They are confident of seeing the same or higher growth by 2027. To contrast, laggard organizations report post-surge growth of 10% or less per year, and lack confidence about their future e-commerce growth.

The report found winning retail organizations shared four common characteristics:

  • Greater investments in digital technologies and e-commerce, with over 70% of winners investing more than 10% of their revenues
  • More mature technology stacks, heavily employing third-party e-commerce platforms
  • Many more ambitious e-commerce initiatives, including promos, assortment, pricing, and disruptive technologies
  • Teams that work in more agile, cross-functional, and autonomous ways—with 64% of winners having fully agile teams versus just 30% of laggards

Let’s break down these characteristics into some practical steps teams can take in 2024 to supercharge their growth.

Unplatforming vs. Replatforming

Many teams think that they need to rip and replace their legacy e-commerce systems to make a significant change to their tech stacks. This line of thinking restricts companies from taking action on acute problems, causing them to fall further behind the competition. In truth, you don’t need to replatform in order to change a critical component in your legacy system.

Instead organizations should consider Unplatforming by shrinking the problem to solve; for example, a company might consider isolating a single geography or product line and making a change — testing and learning within a controlled experiment. Or they might try isolating smaller components of their existing tech stack that are not working for them, substituting in API-connected components of a composable commerce system. These components can hook into an existing technology, like an ERP system, reducing the risk associated with making a technology change.

Over time, it may make sense to swap more components of the legacy e-commerce platform for a modern, composable commerce technology. These technologies enable the other two winning parts of the formula, including the ability to execute on “ambitious e-commerce initiatives” and agile, cross-functional work.

Get started with Elastic Path today

Explore fast, flexible, and scalable eCommerce solutions from Elastic Path.

Taking on ambitious projects

As a part of taking on ambitious projects, the retail winners BCG surveyed are consistently testing disruptive technologies. Yet, they’re still determining areas of strategic focus: “Over 40% of these winners still have to work toward adding or revamping critical tech components, such as product information management or digital asset management software or their monetization stack, where relevant.”

The good news is that composable commerce technology enables rapid experimentation with much lower risk. Whether it’s social commerce, commerce media, dynamic product bundling, or shoppable landing pages — composable commerce unlocks more opportunities to test and learn from the latest trends. Combined with technology like generative AI, merchandisers can increase the pace of their experimentation, testing new content types and personalization techniques to increase engagement and unlock more revenue.

Removing silos and enabling faster experimentation

More than 50% of winners surveyed by BCG said they have extensive team agility, compared to only 20% of laggards. A second order effect of being stuck with legacy technology is an inability to move quickly, and a reliance on engineering to get anything done. Some initiatives, like spinning up a variety of SEO-optimized shoppable landing pages with generative AI, need to happen quickly to capitalize on search intent. Otherwise, that demand will be captured by competitive giants like the Amazons and Walmarts of the world.

Brands that consider composable commerce can break down the silos between engineering and merchandising or marketing. The goal is to enable rapid experimentation through low-code or no-code tools that reduce reliance on engineering. It’s possible for these tools to be easy to use, while still connecting to the larger eCommerce ecosystem in play — without the need to replatform. I’m a firm believer in the fact that technology should enable progress, not stand in its way.

Looking ahead, it’s clear that leading organizations should continue their investment and experimentation with composable commerce. A big part of that experimentation includes breaking down legacy patterns of thinking around replatforming and embracing more measured approaches to breaking up with eCommerce monoliths of the past. Not only is this Unplatforming approach better for risk-averse teams, it also allows for organizations to test what works and doesn’t work — without waiting to fall behind the competition.

Subscribe to our blog

Subscribe to our blog to stay up-to-date with the latest commerce industry insights, tips & tricks, merchandising and development best practices, and more!

Loading Form...