With e-commerce adoption soaring, we look at how "headless" architecture — which separates the back-end nuts and bolts from the ways customers interact with a shopping platform — could help brands and retailers better compete with giant e-commerce players like Amazon and Walmart.
Online transactions now happen across a rising number of platforms and on lots of different devices — from laptops to mobiles to smart speakers. Yet, a lot of today’s e-commerce infrastructure was built with just desktop computers in mind. Headless commerce could soon change that.
Headless commerce architecture separates the customer interface (the front-end) from a platform’s core commerce functions (the back-end) like processing payments and keeping track of inventory.
By allowing customer interactions like message-based sales channels or 1-click checkouts to become more plug-and-play, this approach offers a way for brands and retailers to more easily tap into emerging e-commerce mediums like voice, text, mobile, and more. Notably, Amazon leverages headless architecture to offer a consistent shopping experience to its Prime members across desktop, mobile, and voice.
Propelled by the sudden rise in e-commerce adoption resulting from the pandemic and the need for brands and retailers to better serve online shoppers as they scale their digital channels, headless commerce is attracting more and more media attention.
Table of contents
- What makes headless commerce different?
- What are the benefits of headless commerce for brands and retailers?
- What’s next for headless commerce
What makes headless commerce different?
E-commerce platforms were originally built for desktop-based shopping — the only available platform for many years — using a monolithic architecture with tightly coupled back-end and front-end components. However, the growth of mobile commerce over the past decade and the more recent emergence of numerous other forms of e-commerce have pushed brands and retailers to look for a more flexible approach like headless commerce.
The main differentiator for headless commerce architecture is that the back-end and front-end components are decoupled systems that communicate through an API (application programming interface) layer.
A company can use back-end databases, with information from sources like customer relationship management platforms, to handle features like product information, marketing logic behind promotions and discounts, and checkout, among others.
This output — think product images, prices, “buy now” buttons — is then pushed using APIs to front-end experiences, which can include any digital user interface. This can make it easier for companies to allow shoppers to transact using mediums like mobile apps, Instagram store pages, or even interactive kiosks.
What are the benefits of headless commerce for brands and retailers?
One advantage of a headless commerce approach is that it helps brands and retailers to offer a more tailored and seamless shopping experience for customers — aiding broader efforts to attract and retain shoppers.
Improved user experience and navigation
Using an API-based architecture like headless commerce makes it easier for merchants to deliver front-end experiences using Progressive Web Applications (PWA) technology, which can significantly accelerate page load speed and therefore boost sales conversion rates by reducing page abandonment. A survey by Google found that 53% of mobile site visits are abandoned if pages take longer than 3 seconds to load, translating into lost revenue for brands and retailers.
At the same time, headless commerce platforms allow for the same information to be available on — and optimized for — a broad range of devices and contexts. This particularly matters for mobile commerce.
A traditional commerce architecture built for desktop-based navigation would often show the same website layout on a smartphone as a laptop, leaving potential shoppers zooming in to read content, struggling to find the “add to cart” button, or even abandoning a transaction. Being able to design specific experiences for various mediums without having to worry about updating back-end systems can help retailers cater to more types of devices and scenarios.
Differentiated digital experiences and faster deployment
With the sudden rush to offer fleshed-out e-commerce options amid the Covid-19 pandemic, offering a differentiated digital experience is becoming more and more vital for attracting online shoppers.
But sellers using a headless approach might find this an easier task. The modular nature of headless commerce architecture makes it more straightforward for merchants to create new digital experiences, for example, by:
- Adding commerce capabilities to more digital touchpoints. Customers today can find themselves shopping on social media pages, smartwatches, connected cars, and much more — every medium requires a tweaked approach but also casts a wider net and can offer users more convenience and a better customer experience
- Enabling personalized shopping experiences across touchpoints. Removing data silos between touchpoints means that customer data is more easily accessible and actionable, thus allowing brands and retailers to make better use of their predictive analytics capabilities
- Facilitating the adoption of new business models. Trending approaches to commerce, like subscriptions or rentals, can be enabled by discrete modules — as opposed to having to update an e-commerce site’s entire back-end infrastructure
While some monolithic e-commerce platforms may offer some or all of these touchpoints and features, brands and retailers using these platforms may still be hampered in integrating commerce experiences that may arise in the future. A headless commerce engine allows brands and retailers to experiment with the front-end without requiring developers to make changes on the back-end. This could help reduce the time needed to launch a new touchpoint or A/B test a new shopping flow, for example.
What’s next for headless commerce
A number of brands and retailers have already adopted a headless commerce architecture, including Amazon, Walmart, and Nike, among others. Going forward, we expect headless commerce use-cases to expand far beyond mobile website optimization and large B2C merchants.
Virtual pop-up stores will gain momentum
A headless commerce system makes it simpler to create new online touchpoints. Expect brands and retailers to leverage this capability to launch campaign-specific, time-limited e-commerce websites and experiences, similar to how some already use physical pop-up stores. For example, early headless commerce architecture adopter and L’Oréal-owned beauty brand Lancôme launched its first-ever virtual pop-up store in Singapore in August 2020. The temporary online experience included a virtual consultation, a live-streaming section, and a dedicated shop.
Low-code/no-code services will make headless more accessible
Dominant players in the e-commerce platform space such as Shopify, BigCommerce, and Magento are already starting to offer headless commerce capabilities. However, these solutions are often retrofitted, meaning that they provide headless tools or modules on top of a monolithic architecture which can limit their benefits, or requires a full — and expensive — team of developers. Some recently funded startups such as Shogun and Commerce.js are aiming to make headless commerce solutions more accessible, especially to SMBs, by providing low-code/no-code environments to build and optimize storefronts for headless architectures without the need for developers.
Headless is coming for B2B e-commerce
The pandemic has pushed B2B buyers and sellers to increasingly transact online, thus boosting demand for B2B e-commerce solution providers such as Spryker. The Berlin-based startup, which recently raised $130M, helps B2B companies build their e-commerce channel with a headless architecture that includes B2B-specific features such as quotation & offer management, company user permission, and packaging & measurement units, among others. We anticipate that this type of solution will gain in popularity as more of the wholesale industry moves online thanks to the rise of platforms such as Faire, and as more B2B buyers demand an equally convenient purchasing experience as when they shop for themselves.
Will headless commerce become the new normal?
Looking ahead, headless commerce architecture is set to continue gaining traction and will likely become the go-to approach for brands and retailers that want to, and can afford to, tap into multiple elaborate e-commerce channels — including smartwatches, messaging services like WhatsApp, recommerce, and more.
Currently, adoption will be limited among medium and small businesses due to steep setup costs and the need to have a dedicated engineering team to manage the infrastructure and make changes. Going forward, the affordability and ease-of-use of low-code/no-code services will likely determine how quickly smaller brands and retailers implement a headless commerce architecture. But those that do will find themselves better placed to compete with e-commerce giants like Amazon. Getting ahead may soon mean going headless.If you aren’t already a client, sign up for a free trial to learn more about our platform.