When is Composable Commerce the Right Choice for Your Business?
Carlos Oliveira
Composable commerce is an emerging approach in the e-commerce landscape that emphasizes flexibility, scalability, and adaptability. Unlike traditional monolithic platforms, composable commerce allows businesses to tailor their e-commerce stack by selecting and integrating best-of-breed components that meet their unique needs.
The composable commerce strategy enables companies (particularly those going global) to respond quickly to changing market demands, innovate faster, and deliver a superior customer experience.
However, understanding when to adopt composable commerce is crucial, as it involves a significant investment in time and resources.
What is Composable Commerce?
Composable commerce refers to an approach in e-commerce architecture where businesses build their platform using a selection of modular components rather than relying on a single, all-in-one solution.
This composability allows for greater customization and flexibility, as each component can be independently selected, developed, and deployed.
Composable commerce helps optimize total cost of ownership (TCO) by enabling businesses to scale components independently, reducing unnecessary infrastructure and operational costs.
Components address functionalities such as product catalog management, personalized customer experiences, payment processing, inventory management, search optimization, content management, omnichannel retail integration, and more.
The ultimate goal is to create a tailor-made solution that perfectly aligns with the business's operational needs and customer expectations.
And IT leaders have felt the pressure and taken notice. A 2024 report by the MACH Global Research 2024 found that 89% of U.S. IT decision-makers found the MACH principles (microservices, API-first, cloud-native SaaS, headless) have been very or quite important in helping their organization meet customer expectations in recent years.
Cheat Sheet: Should You Invest in Composable Commerce?
Before we go into the details, here are straightforward questions and answers:
When should a business invest in composable commerce? When the business...
- Requires high flexibility and customization
- Is focused on long-term growth and scalability
- Wants to avoid vendor lock-in
- Operates in a fast-paced, competitive market
- Needs omnichannel capabilities for consistent customer experiences
- Aims to future-proof its e-commerce platform
- Prioritizes speed and agility in development
- Looks to optimize long-term costs
- Needs to innovate without disrupting the entire system
- Must enhance security and meet compliance requirements
When composable commerce may not be the best fit for your business? When...
- You have limited technical resources or expertise
- You need a quick, out-of-the-box solution
- Your budget cannot accommodate higher initial costs
- You don't require extensive customization or flexibility
- You are satisfied with a single-vendor platform
- Your business operates in a low-competition, slow-changing market
- You don't have frequent updates or feature releases
- Your business priorities are focused on short-term solutions over long-term scalability
The Key Components of Composable Commerce
Composable commerce is built on several key components that work together to provide a flexible and scalable e-commerce solution.
Microservices
Microservices architecture is at the heart of composable commerce. It involves breaking down the e-commerce platform into smaller, independent services, each responsible for a specific function, such as payment processing, inventory management, or customer authentication.
Such modularity allows businesses to deploy and scale individual services without affecting the entire system, leading to increased agility and faster innovation.
APIs
Application Programming Interfaces (APIs) are crucial in a composable commerce setup. They enable different microservices and third-party applications to communicate with each other seamlessly.
APIs allow businesses to integrate various components, such as CRM systems, marketing automation tools, and other specialized services, into their e-commerce platform.
This integration ensures the platform remains flexible and can evolve with the business's needs.
Headless Architecture
Headless architecture is another foundational element of composable commerce. It separates the front-end presentation layer from the back-end functionality, allowing businesses to deliver content and services across multiple channels—such as web, mobile, social media, and IoT devices—without being tied to a specific front-end framework.
The decoupling enables businesses to innovate on the front-end independently of the back-end, providing a more dynamic and engaging customer experience.
Pros of Composable Commerce
It’s essential to talk about the composable commerce pros and cons. Let’s start with the upsides.
In a 2023 survey, 200 U.S. retail leaders listed these as the top composable commerce benefits:
- the ability to create highly differentiated digital experiences (30%)
- improved customer satisfaction (30%)
- the ability to make incremental changes rather than undergoing a complete overhaul or replatform (29%).
Successful Case Study – Lulu
Lulu, a pioneer in self-publishing, faced limitations with its monolithic e-commerce platform, which hindered innovation and adaptability. Some of the challenges were related to its market, such as a complex and global supply chain, inconsistent legacy data, and an abundant number of features.
The company transitioned to a 100% bespoke composable platform with the support of Mirumee, allowing complete control over its features and user interface.
The composable commerce includes over 40 microservices to handle everything from the bookstore frontend to checkout – while orchestrating platforms for specific needs, such as Avalara (tax compliance) and Adyen (payment).
Flexibility and Customization
Composable commerce allows businesses to customize their e-commerce platform by selecting the components that best match their requirements.
Instead of relying on a one-size-fits-all solution, companies can build a tailored platform that aligns perfectly with their goals and customer needs. Such flexibility enables businesses to adapt quickly to changes and deliver a unique experience that stands out in the market.
Scalability
One of the standout benefits of composable commerce is its scalability.
With a modular setup, businesses can independently scale individual components, such as front-end services or back-end systems. As a result, the store can handle increased traffic or new business requirements without overhauling the entire platform.
This ability to scale efficiently helps ensure a smooth user experience and optimized resource management.
Enhanced User Experience
Composable commerce enhances the user experience by allowing businesses to create more personalized and engaging interactions.
By integrating best-in-class components, companies can offer relevant content and seamless experiences across all customer touchpoints, whether online, on mobile, or through other channels.
Composable commerce helps to increase customer satisfaction and loyalty by providing a consistent and tailored shopping experience.
Fast Time to Market
Composable commerce enables faster deployment of new features and services. Because each component operates independently, it’s possible to update or make changes without affecting the entire system.
This agility allows businesses to respond to market demands and roll out innovations quickly, giving them a competitive advantage.
Best-of-Breed Solutions
With composable commerce, businesses can integrate the best tools and services available rather than being limited to the features of a single vendor.
As a result, you can incorporate cutting-edge technologies and specialized solutions to enhance your platform's performance and capabilities.
No Vendor Lock-In
Composable commerce reduces the risk of vendor lock-in, a common issue with traditional platforms.
Businesses can avoid dependency on a single provider by selecting and replacing individual components as needed.
This freedom allows you to evolve your technology stack over time, ensuring your platform remains adaptable and up-to-date without significant disruption or cost.
Challenges of Composable Commerce
While composable commerce offers many advantages, it’s essential to understand that it may not be the right choice for every business (or, at least, for every stage).
Going composable comes with challenges that must be carefully considered before deciding to adopt it.
Complexity of Implementation
One of the main challenges of composable commerce is the complexity of implementation. Unlike traditional, all-in-one platforms, composable commerce requires businesses to integrate multiple components from different vendors.
The integration process requires a solid technical team to manage the integrations effectively. If your business lacks in-house expertise, hiring specialized developers or consultants is recommended.
At the end of the day, composable commerce offers greater flexibility, which means it’s crucial to weigh the technical demands and ensure your team is prepared to handle them.
Higher Initial Costs
Building a custom platform by integrating various components can be more expensive upfront compared to choosing a traditional monolithic solution. You’ll need to invest in multiple technologies, hire or train skilled developers, and possibly engage external consultants to ensure everything works seamlessly.
However, while the initial costs are higher, the long-term benefits of scalability, flexibility, and the ability to innovate quickly may outweigh these initial expenses.
No surprises here: considering your budget and long-term strategy is adamant.
Maintenance and Management
Maintaining and managing a composable commerce platform can be more demanding than a traditional setup. Since you’re dealing with multiple components from different vendors, ongoing maintenance requires regular updates, troubleshooting, and ensuring that all parts of the system continue to work well together.
Such monitoring can be resource-intensive. Additionally, you’ll need to stay on top of updates and ensure that any changes to one component don’t negatively impact the overall system.
Conversely, modern tools are often ready to address these challenges. Vendors increasingly offer automated updates, monitoring tools, and comprehensive support services that reduce the burden on your internal team.
Furthermore, many composable platforms are built with user-friendly management interfaces, making it easier for non-technical staff to oversee the platform without deep technical expertise.
When to Choose Composable Commerce?
Choosing composable commerce is a strategic decision that depends on several factors specific to your business.
Here are some scenarios where composable commerce might be the right choice:
Your Business Requires High Flexibility and Customization
Composable commerce is a strong option if your business operates in a unique market or has specialized needs that a standard, out-of-the-box e-commerce solution cannot meet.
Composability allows you to build a platform tailored exactly to your requirements, enabling you to deliver a customized user experience and adapt quickly to changes in your market.
You’re Focused on Long-Term Growth and Scalability
If your business plans for substantial growth, composable commerce offers the necessary scalability. The ability to independently scale different components of your e-commerce platform means you can grow without being constrained by the limitations of a monolithic system.
This approach also allows you to continuously innovate and expand your platform’s capabilities as your business evolves.
You Want to Avoid Vendor Lock-In
For businesses that value independence and want to avoid being tied to a single vendor, composable commerce is an excellent choice, as it allows you to select and change individual components as needed, giving you the freedom to evolve your platform without being locked into a long-term contract with one provider.
Your Business Operates in a Competitive Market
If you’re in an industry where speed and adaptability are critical, composable commerce enables you to launch new features and services quickly.
The ability to make updates or changes to specific components without disrupting the entire platform gives you a competitive edge, allowing you to respond swiftly to new market trends and customer demands.
Your Strategy Demands Omnichannel Customer Experience
Composable commerce is an excellent fit for businesses aiming to deliver a consistent and engaging customer experience across multiple channels – whether online, in-store, mobile, or social media.
The headless architecture component of composable commerce allows you to deliver content and experiences across various platforms without being tied to a single front-end interface.
You Want to Future-Proof Your E-Commerce Platform
As technology evolves and new tools emerge, a composable commerce setup lets you integrate these innovations into your platform without needing a complete overhaul. Future-proofing ensures that your e-commerce operations remain competitive and adaptable, protecting your investment in the long run.
Your Business Prioritizes Speed and Agility in Development
If rapid innovation and quick iteration are central to your business strategy, composable commerce fits well by enabling faster development cycles.
Since each platform component can be developed, tested, and deployed independently, your team can experiment with new features, optimize performance, and roll out updates more efficiently.
You’re Looking to Optimize Costs in the Long Run
While composable commerce may involve higher initial costs, it can lead to cost efficiencies over time. By choosing and paying for only the components you need, you avoid the bloat and inefficiencies that can come with all-in-one solutions.
Additionally, the ability to scale components individually means optimizing spending based on actual usage and business needs, potentially reducing operational costs in the long term.
You Need to Innovate Without Disruption
Composable commerce's modular approach is particularly advantageous in highly competitive markets where downtime can lead to lost revenue. It allows you to innovate and implement changes without disrupting the entire system.
Whether you’re launching a new feature, upgrading a service, or testing a new component, you can do so with minimal impact on the overall platform’s stability and performance.
You Want to Enhance Security and Compliance
For businesses operating in industries with stringent security and compliance requirements – such as finance, healthcare, or government – composable commerce offers the ability to build a platform that meets these specific needs.
By carefully selecting components that adhere to industry regulations and standards, you can ensure your platform remains secure and compliant without sacrificing flexibility or performance.
How to Decide if Composable Commerce is a Good Fit?
Composable commerce offers a powerful alternative to traditional e-commerce platforms, providing businesses with the flexibility, scalability, and control needed to thrive in today’s dynamic market environment.
While the initial complexity can be higher, the long-term benefits – such as enhanced customization, faster time to market, and the ability to integrate best-of-breed solutions – make it a compelling choice for businesses prioritizing innovation and growth.
The bottom-line: assessing your company’s specific needs, technical capabilities, and long-term goals is essential before making the switch.
By understanding the pros and cons and learning from other businesses' experiences, you can make an informed decision about whether composable commerce is the right path for your e-commerce strategy.
Composable Commerce FAQ
What is composable commerce?
Composable commerce is an approach to building e-commerce platforms using a selection of modular, best-of-breed components. Instead of relying on a single, monolithic system, businesses can integrate various services into a customized platform that meets their unique needs.
How does composable commerce differ from monolithic commerce?
Monolithic commerce platforms offer an all-in-one solution where all features are built into a single system. While this can be easier to manage, it lacks flexibility and can be difficult to scale or customize. Composable commerce allows businesses to select and integrate individual components, offering greater flexibility, scalability, and the ability to innovate quickly.
When should a business invest in composable commerce?
A business should consider investing in composable commerce if it requires a high degree of flexibility and customization, needs to scale rapidly, or operates in a fast-changing market. It's also a good choice for companies with complex requirements, those looking to avoid vendor lock-in, or businesses that prioritize delivering a superior customer experience.
What are the pros of composable commerce?
The pros of composable commerce include increased flexibility and customization, scalability, enhanced user experience, faster time to market, the ability to use best-of-breed solutions, and freedom from vendor lock-in.
These benefits allow businesses to build a platform tailored to their specific needs and adapt quickly to market changes.
What are the cons of composable commerce?
The cons of composable commerce include the complexity of implementation, higher initial costs, and the need for ongoing maintenance and management. Businesses must be prepared to invest in skilled technical teams and may face challenges in integrating multiple components from different vendors.
Despite these challenges, many businesses find the long-term benefits outweigh the initial hurdles.
How does composable commerce affect time to market?
Composable commerce can significantly reduce the time to market for new features and services.
Because components can be developed and deployed independently, businesses can implement changes without overhauling the entire system. This allows for quicker innovation and responsiveness.
What industries benefit most from composable commerce?
Industries that experience rapid change, such as fashion, technology, and consumer electronics, benefit most from composable commerce. It’s also ideal for businesses with complex product offerings or those requiring a high level of customization, such as B2B companies. Additionally, companies in highly competitive markets, where agility and innovation are crucial, find composable commerce particularly advantageous.
