trends for e-commerce solutions

2018, what landscape and trends for e-commerce solutions?

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2017 represents a new structural component in the great battle waged by e-commerce platform editors. As is often the case, the vagaries of acquisitions enable giants to assert themselves, while the small quake with fear.

 

2017 represents a new structural component in the great battle waged by e-commerce platform editors. As is often the case, the vagaries of acquisitions enable giants to assert themselves, while the small quake with fear.
The e-commerce landscape is constantly evolving. Technologies are born, grow and impose themselves as leaders, or disappear into oblivion. The previous substantial acquisition was Hybris by SAP in 2013. Back then, the landscape was dominated by four greats: SAP, ORACLE, IBM and DEMANDWARE with a few safe bets sharing the middle & lower market (Intershop, Magento, etc.). The acquisition of Demandware by SalesForce in 2016, which gave rise to SalesForceCommerce Cloud, is therefore a good opportunity to question the evolution of this ecosystem by focusing this article on three actors who are breaking away from the others, namely SAP Hybris, SalesForceCommerce Cloud and Magento.


THE B2C BATTLE

The most natural and competitive playground for such solutions is obviously B2C, and in this matter it must be said that SalesForceCommerce Cloud is doing pretty well for itself. As a historic actor that has built its reputation around the retail sector, it has for several years managed to win over major retail actors thanks to its business model and the support afforded to each retailer by its "customer success team". Demandware's dominant position has contributed to the decline of ORACLE and IBM in B2C. Hybris only just managed to keep its head above water, mainly in the "full SAP" niche, and thanks to its ability to include specific developments.


Magento on the other hand has settled in the middle market. The platform refers to itself as the first reference worldwide in terms of the income managed by its platform. Yet the solution suffered as a result of its lack of performance and internationalisation, which hindered its ability to compete with SAP Hybris and Demandware with regard to major B2C actors. The arrival on the market of the 2.0 version has greatly improved the situation, although it doesn't seem to be causing any radical change in the established order. This editor is however enhancing its functional coverage with CMS modules, the buyout of Bluefoot CMS, and the development of two OMS and BI modules, as well as numerous partnerships with Adobe and ACQUIA …


The B2B sector has enjoyed a significant increase for several years now. SAP Hybris rapidly identified this rise, and has currently positioned itself as the sole leader in this segment. As early as 2014, SAP Hybris launched its B2B Accelerator offer, and set out to take the market by storm.


THE B2B CHALLENGE

The changes in this segment's landscape aren't quite as straightforward. Until now SAP Hybris had a free hand with regard to key accounts, but is now witnessing the arrival in its wake of a serious rival with the Magento 2.2 release and its B2B module. Although its capacities aren't as great, Magento will enable many B2B businesses to take the plunge for less, while validating the sustainability and ROI of this new channel. Magento 2 has greatly improved upon its weak spots, scalability and performances, and will therefore be in a position to take businesses into previously uncharted waters. It's worth noting that this module is only available in Enterprise version (paid version). And what of SalesForce in all this? Here we are indeed touching on the core activities of SalesForce CRM … Yet, must this be seen as stating the obvious for SalesForceCommerce cloud? The market is tempting of course, but how should it be addressed? The solution's present model is far too limiting to subscribe to the complexity and specificity of B2B scenarios. The idea of standardising B2B business processes into a single SAAS platform is probably utopian. Should we be expecting an "open" version of SalesForceCommerce Cloud? As yet there have been no information leaks regarding the chosen strategy, but there's little likelihood of SalesForce failing to make the most of the strength of its installed base, combined with its recently perfected marketing automation tools to launch its offer. All eyes are now on the CloudCraze solution, an ISV Salesforce partner having developed this eCommerce solution on the same platform. The raising of 20 million dollars in January 2017, to which the Salesforce Ventures investment fund contributed, could be the decisive sign of the strategy implemented by the San Francisco-based editor.


THE CLOUD IS THE LIMIT

Some companies experienced the Space Race, and we are currently involved in the Cloud Race. All editors are now equipped with a more or less comprehensive Cloud offer. Since 2014, when Demandware was alone in providing its SAAS approach, the SAP Hybris Commerce Cloud and Magento Cloud Edition offers have appeared on the market.


The real challenge of such offers is to be able to combine the flexibility of an on premise solution and its extension capacities, by adding specific functionalities, and the strength of the SAAS model that ensures easy maintenance and updating features. Let's not delude ourselves, these offers are private clouds hosting on premise solutions. Yet they do provide the capacity to find a happy medium between flexibility and strength. What now remains is to control the extension work technically, so as to avoid any nasty surprises during upgrades. Editors are obviously only prepared to commit to the native perimeter of their respective solutions.


And finally, SAP Hybris and Magento also took the opportunity to change their pricing systems with a recurrent model indexed on the income generated by the platform. The eCommerce solutions market is evolving at a regular pace, and essential actors such as Oracle & IBM have seen their market shares dwindle drastically, whereas others, such as Salesforce and SAP, have become leaders thanks to their acquisitions. What will tomorrow's solutions be? Orocommerce, Episerver? Solutions that are sometimes new (Orocommerce) or located in their original area (Episerver in the Nordics) are reinforcing their reputation. But at whose expense? Will the premium position of SAP Hybris allow it to maintain its dominant position? Will Salesforce be able to digest its acquisition of Demandware, and make its mark on the solution? Will Magento successfully complete its shift towards key account targets?


Each solution has its own gravity centre and comfort zone. When opting for one in particular, it's important to ask the right questions, and to really define the issues and objectives of the project. This will naturally point to a shortlist of eligible solutions.

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Benoit Honorat: Practice Leader E-commerce, SQLI


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