When is it worth considering Composable Commerce?

What is Composable Commerce?

In today's fast-paced business environment, companies need to be agile and able to quickly adapt to changing market conditions. Composable commerce is a development approach that enables businesses to achieve this flexibility by selecting the best commerce components and combining them into a custom application tailored to specific business needs. This is achieved by composing Packaged Business Capabilities (PBCs), which are pre-built, independent business functions that can be combined and reassembled as needed.

With composable commerce, businesses can achieve a more agile and responsive e-commerce operation that can keep up with the pace of today's digital marketplace. For this article we use this definition: “Combining IT solutions from (usually) different providers, making your organization agile so you can always switch quickly”.

Business and IT architecture are now inextricably linked in e-commerce. Although marketers and salespeople have already made huge steps towards a more digital and data-driven way of working, some of them still prefer to stay away from IT architectures. That is a shame, because this architecture ultimately determines not only what your e-commerce organization looks like now, but also how (quickly) you can shape the future.

How Composable Commerce enables business agility

Research and advisory firm Gartner refers to the example of Services Australia, which provides health and social services to more than 25 million residents in Australia. To prevent the spread of the coronavirus pandemic in 2020 as much as possible, lockdowns were announced in Australia and digital touchpoints became more important than ever. However, the Services Australia website quickly crashed during the first lockdown due to the enormous number of visitors.

Services Australia was able to correct the overload very quickly thanks to its composable structure. To meet the high demand, separate IT applications were deployed and linked to each other. Visiting appointments were converted to telephone or online (video) appointments, voice printing technology was implemented for 1.2 million users and the use of the digital assistant increased by 600%. Because the IT and the business were composable, Services Australia was able to quickly provide a safety net to citizens who needed it.

Composable Commerce supports evolutionary architectures

Large e-commerce organizations are often used to building their own IT solutions. If the software no longer fits, for example if it is at the end of its life, the entire system is replaced by a newer version. According to expert Rebecca Parsons, this is no longer needed today, and she prefers to speak (for example in this presentation) of "evolutionary architecture".

By improving parts of your IT architecture every time, you continue to grow. This is therefore very close to the intention of composable e-commerce: not one rigid IT solution, but a composite network with multiple applications from different providers. The latter is sometimes seen as a stumbling block, because on average there are about 15 different applications within a composable e-commerce organization. The question is often whether that is not confusing. In practice, however, within an organization it appears that only two or three different applications are used per department. This is very manageable for the employees if care is taken to ensure that the data can be shared with the entire organization.

For what kind of organizations is Composable Commerce suitable for?

You want an e-commerce environment that is flexible, so that you can continuously grow with market developments, but is it better to build an e-commerce environment yourself, or is it more convenient to buy separate parts that you need at the moment? It depends on the requirements you set for your systems and their complexity.

At the intersection of business and IT, it must be looked at whether composable e-commerce is the best way. Of course, this is not a sacred approach, although it is often worth considering composable e-commerce in any case. The build-versus-buy principle plays a major role in this. With a composable approach, you can purchase many more components that are already available on the market. This can save on costs because you don't have to build everything yourself (or because you only use a small part of an expensive monolithic system). This is certainly the case for medium to large companies and it has everything to do with the wide range of software solutions that are often needed.

There are, of course, exceptions that confirm the rule. But looking at larger organizations, it is possible to see that they can hardly live without the composable formula anymore. Their organizations and their e-commerce are often so complex that building their own solution means running into high costs. Add to that also maintenance costs and the fact that there is still a shortage of developers, and it is clear why a solution with “purchased” individual components – from different suppliers - is often much cheaper and more efficient. 

Why connection components are key for Composable Commerce

A crucial point that remains important to mention is that the success of composable e-commerce depends on the way in which all components are connected to each other. If the various suppliers do not include this aspect in the development of their software, the composition of so many separate parts will not work in practice. But if different developers take each other into account and ensure that as many solutions are compatible, or even plug-and-play, then composable e-commerce is certainly the future.