June 22nd, 2022 | 5 MIN READ

Overcoming Commerce Inertia is Easier than You Think

Written by author_profile_images Bryan House

Bryan is the SVP of Product and Customer Success at Elastic Path. Previously, Bryan was the Chief Commercial Officer at Neural Magic, a deep learning software startup where he ran Product, GTM, and Customer Success. An Acquia founding team member, he helped lead the company to $170+M in revenue. His expertise spans machine learning, digital experience platforms, and open source technology. 

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The road to a modern software stack is paved with perceived obstacles. As with many things in life, these obstacles aren’t as hard to overcome as inertia itself. If you’ve ever hesitated and stared at your running shoes before just getting out the door for a workout, you know what I’m talking about.

The story of inertia plays out again and again in tech, and especially in commerce. While the benefits of going all-in on API-first are clear, the perception is that it’s difficult to foundationally overhaul the commerce platform. In reality, this perception couldn’t be further from the truth.

So, what tips the scale for making changes we perceive as difficult? What forcing functions get us to move on to fundamentally better technology? Let’s look at how these dynamics have played out in the restaurant industry over the past few years, and how they’re currently playing out in commerce.

Toast: Reinventing the restaurant POS

The success of restaurant tech company Toast is a perfect example of unseating a deeply entrenched technology that nobody likes – the point of sale (POS) system. In a previous life, I worked in restaurants for more than a decade. I was one of the many service people scurrying back and forth between my patrons and a waitstation desktop computer, swiping a key card attached to my belt to enter orders and process credit cards. While the foundational ordering and payment experience wasn’t necessarily broken, it was cumbersome, slow, error-prone, and, most notably, insecure.

Think about it: the same credit card rails have been operating on mainframes for decades. For years, the U.S. lagged behind other countries in mobile payment adoption. Many viewed this technology as solving a problem that didn’t exist yet.

As with many things digital, the pandemic was a forcing function to overhaul the restaurant POS, which previously relied on processing mostly in-person transactions. Toast was positioned to win as the industry dramatically shifted to takeout, online ordering and curbside pickup.

While these changes were originally based purely on company survival, restaurant patrons today find themselves with a better, digitized POS experience at the table. It’s a seamless, pay-with-your phone experience that doesn’t require the painful steps of waiting for the check to come back (where did my server go?) or doing napkin math for the tip.

As a customer, I can’t imagine going back. A seamless moment at the table can make a big difference. And on the business side, restaurants can feel more prepared for the future. A similar dynamic is happening in commerce, as companies realize they can’t risk their merchandisable moments with customers to ineffective legacy technology.

Commerce: Capitalizing on Merchandisable Moments

Like restaurants, many retailers faced a reckoning with their technology during the pandemic. A dramatic shift to online shopping forced some retailers to overhaul their commerce systems to prepare for the new way customers were buying.

Now that restrictions are loosening, The Wall Street Journal recently covered consumers’ shift back toward in-store buying habits. As with any Black Swan event, the industry is riding a pretty dramatic wave. Experts like Accel Partners expect these big swings to normalize over the next few years, as the U.S. market marches toward 50% ecommerce penetration (It’s important to note that tech-leading markets like China are already at 25% penetration).

 

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An important takeaway from these big swings is the need for retailers to adapt quickly to changes in consumer behavior. During the pandemic, that might have meant embracing curbside pickup, but in the future it might mean NFTs, metaverse commerce, livestream shopping with influencers, or whatever else is on the horizon. These changes require a shift in commerce architecture toward an API-first model.

That’s because differentiation today – and in the future – hinges on the digital experience. Even though some of us may be hanging out in malls more these days (please count me out of this trend) in search of some level of human interaction, high-intent buyers are still prime for conversion online. For most companies, improving digital merchandising starts with the commerce catalog.

Overcoming Catalog Entrenchment

Much like the restaurant POS example above, the commerce catalog is so deeply entrenched that retailers don’t believe change could possibly be easy. As a result, you’ll see many popular sites living with broken “shop the look” experiences. Gorgeous, catalog-like landing pages promise consumers the option to buy the exact item they see in the photo in one click.

Instead, consumers have to sift through endless options to get the actual size and color pictured. The paradox of choice coming alive right before our eyes on a digital screen. These broken experiences leave customers frustrated and block conversions from otherwise high-intent buyers.

Sadly, the market just accepts these internalized limitations of status quo legacy commerce vendors. But it doesn’t have to be that way.

With Elastic Path Commerce Cloud, we’ve solved this legacy inertia by separating Products, Price Books and Catalogs into distinct, independent microservices.

By breaking down the “commerce catalog” into its atomic elements, we have unleashed an entirely new range of combinatorial possibilities for digital catalogs, with no custom development required. Link directly to the child item shown in the $250K “shop the room” photo? Check. Hot swap catalogs to support promotional events such as high-traffic sales? Check. Create catalogs with complete contract-negotiated pricing for every one of your B2B partners? Check. Create a catalog to take advantage of the next digital experience innovation – the one that has yet to be created? Check.

To see for yourself, check out this YouTube series, where my colleague Scott Johnstone demonstrates how easy it is to move from authentication in Elastic Path Commerce Cloud to a published product catalog in less than 45 minutes. Power users can take it a step further by using advanced options within the Elastic Path Commerce Cloud API, as demonstrated in this video series.

To sum up, inertia for inertia’s sake is no longer acceptable, especially as the retail world continues to generate massive revenue through digital channels. While we hopefully won’t be experiencing a Black Swan event like the pandemic again for some time, expect ecommerce penetration to continue its upward trend. The only way to keep up with constantly changing consumer demands and emerging channels is to embrace the flexibility of API-first commerce. It all starts with the commerce catalog – a foundational shift that can happen much faster than you think.

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