Three things to consider when evaluating your e-commerce platform

As technology rapidly evolves and organizations expand their e-commerce offerings, systems are becoming obsolete faster than ever — a change that is even more pronounced as consumers and companies alike wade even further into e-commerce waters due to the global pandemic.

Keeping up with ballooning order demand and providing the latest front-end features, such as support for video, audio or free stock photos, can be key challenges for organizations that don’t prioritize cutting-edge e-commerce solutions. However, with the right strategy in place, savvy leaders can get ahead of these and other challenges to drive tremendous growth, even amid significant disruption in the marketplace and the ever-evolving business conditions that come with it.

Evaluating whether the current e-commerce solution still meets the company’s needs

A key driver in evaluating whether the company’s systems need to be replaced or upgraded is determining how well they integrate with other key technologies, provide scalability and allow for customization to meet current demand. Similarly, high maintenance costs associated with legacy systems and a lagging customer experience that is eclipsed by the competition also signal the need for change. If one or more of these factors affects the organization’s e-commerce operation, a major upgrade or new solution may be necessary.

Given the significant costs around e-commerce solutions, management may be tempted to continue using existing systems in order to drive near-term cost savings. Depending on a platform’s integration, scalability and customization capabilities, this may be the most cost-effective approach to keep up with e-commerce expectations and demand. But it is also important to analyze how well the current system will perform in the years to come in comparison to competitors’ platforms. If this analysis suggests that the organization can keep up with tech innovations through upgrades, this may be the most efficient approach.

E-commerce systems should be customizable and provide customers with front-end features and an overall experience that’s as good as or better than that offered by the competition.

Many software-as-a-service (SaaS) vendors offer the convenience of implementing system upgrades for their clients, and when practical this approach has several advantages. Namely, system upgrades are less time-consuming and do not require additional time for employee upskilling or customer education on brand-new features. But if the current technology clearly can’t grow with the business or meet evolving customer expectations, the company should resist the temptation to cling to legacy applications simply because they represent a sunk cost. This is why moving forward with a new system is often the best course of action for leadership.

Determining when upgrades alone are not sufficient

As leadership assesses existing systems, there are several factors that must be weighed. Below are the three key areas for consideration.

1. Maintenance costs

New systems can bring enormous benefits to a company by boosting efficiency and revenue. However, because new technology represents another sunk cost, business leaders should determine the amount of savings that eliminating a high-maintenance legacy system would yield to get a true picture of the overall expense. In addition, it’s important to consider the increased revenue and other benefits that come with new tools offered by state-of-the-art e-commerce platforms.

2. Advanced data and analytics

A new solution can also provide opportunities for more advanced data analytics. In the era of big data, e-commerce success depends partly on how well companies understand their customers’ buying preferences, budgets and needs compared to the competition. With analytics, targeted promotions, strategic pricing and product evolution tailored to market demand are within reach — all key drivers of long-term growth.

A key driver in evaluating whether the company’s systems need to be replaced or upgraded is determining how well they integrate with other technologies, provide scalability and allow for customization.

3. Third-party systems integration

Using a SaaS model, new software integrates e-commerce and back-office business functions into one platform. Siloed inventory management and manual stock management can be costly, with overstocks, inventory discrepancies and back orders cutting into profitability. An e-commerce platform that integrates inventory management into its system provides centralization for automated inventory management, which translates to fewer inventory errors. With inventory updated in real time, overselling and missed sales opportunities are not likely to occur.

Moreover, the benefits of integration extend far beyond inventory management. For example, with next-generation e-commerce platforms, customer service representatives have visibility into customer data across all channels in a single view. With centralized order systems, stakeholders can fulfill requests from any sales channel, including online and brick-and-mortar locations. In addition, customers’ order history can unlock personalized service and offers that take customer engagement to the next level. Implementing creative solutions through reliance on integrated software helps to amplify efficiency and drive revenue growth.

At the end of the day, legacy systems that are well integrated and scalable can perform exceptionally well with upgrades when management’s key concern is keeping maintenance costs down. However, when the lack of customization options becomes unmanageable or upgrades don’t deliver the intended customer experience, a new system is the clear path forward. A new implementation helps to recharge the business with new features that keep it running smoothly and profitably for the longer term.