There’s been a lot of talk lately about headless commerce. Perhaps that shouldn’t be a big surprise given the increasing amount of brand engagement that occurs off of a brand’s physical or virtual property. But like any manufactured and generally accepted term, the definition varies depending on who you ask. This was proven true during the recent Salesforce Connections conference, where I spoke with several retailers, analysts, brands, and technology vendors who pontificated about the future of commerce – and the meaning of headless.
The term is catching on, particularly with developers who want the agility to create experiences and propagate the buy button across a myriad of touchpoints. This approach has been in practice for quite some time. In fact, prior to being acquired by Salesforce, we at Demandware thought about it in the context of democratization of retail, where consumers with seemingly unlimited access, knowledge, and power began to dictate and control the terms of brand engagement. In this distributed and democratized operating environment, brands were forced to effectively extend their unique brand experience beyond their physical and virtual four walls to wherever and whenever consumers demand.
This reality became crystal clear to us about five years ago, when a board member challenged us with a provocative question, “What happens if consumers stop going to websites to buy stuff online?” Why was this disruptive and potentially scary for us? Well, our business model was predicated on consumers going to a website to buy stuff online! This prompted my team to do extensive research to uncover where commerce — the buy button — will happen in the future.
We partnered with Deborah Weinswig from Li & Fung and Incisiv, an insights firm that helps consumer executives navigate digital transformation, and we found that commerce will, in fact, increasingly occur on third-party destinations such as messaging platforms, social media, mobile aggregate apps, and marketplaces. This, in turn, will cause companies to shift their historical operating models from pulling consumers to their property to pushing their brand to wherever the consumers are hanging out.
We turned the insights into a manifesto to help guide the industry entitled Democratization of Retail, and we used the findings to influence our product strategy. We continued down the path of opening our platform, revamping our development framework, and formed partnerships with the likes of Facebook and Instagram.
Defining Headless Commerce
Based on these learnings, and after witnessing many customers embark on this journey, here’s my definition of headless commerce: It provides brands with the agility to extend key data and functionality — namely focused on consumer, product, order, inventory, and price — to engage consumers across third-party platforms that own the experience. This approach includes the following three principles:
Consumer Data and Intelligence: It’s imperative that the backbone for headless is consumer data and intelligence. According to the report Consumer Experience in the Retail Renaissance, data is the new currency. Brands must unlock the value that has been trapped in the 39 (on average) disparate consumer-facing systems. Doing so pays off; elite performers leverage data at a 2X higher rate than under performers in areas such as data agility, access, and security.
Unified Engagement Platform: Businesses must consolidate and simplify their technical portfolio to manage consumer engagement across the marketing, commerce, and service journey. This is why two-thirds of brands are in the midst of a unified platform strategy to engage consumers across all touch points — both on and off-property. Check out how Salesforce for Retail enables just such a platform.
Cloud Architecture: With the next consumer destination right around the corner, brands can’t be stymied by on-premise applications. Cloud, with its continual innovation, empowers organizations to leverage new and innovative integrations without the traditional cost and complexity of an upgrade.
This isn’t just a concept. It’s happening now. Take a look at Perry Ellis’ Ask Perry Ellis skill on Alexa. According to the description on Amazon.com, it “is the first voice-activated personal stylist for men, powered by Alexa. Whether it be for a beach wedding, interview or first date, Perry Ellis has the right outfit for every part of your life. Simply say ‘Alexa, Ask Perry Ellis what should I wear to…’ for any occasion. Alexa replies by suggesting a look, taking into account the weather down to the dress code. Alexa can then send her suggestion directly to your email, where you can continue shopping and explore on perryellis.com”
Lacoste is a great example of a brand that’s extending its reach in China; focusing on when millions of consumers spend a lot of their time – WeChat. In addition to establishing a fully functional shop on WeChat back in 2015, Lacoste has integrated WeChat Pay into its offline experience. Its stores now feature posters with scannable QR codes that reveal in-store promotions for WeChat Pay users.
By providing this ultra-convenient service, and being where the consumer is, Lacoste is now closer to its consumers, and has reduced the friction that often occurs between browsing and purchasing, online and offline.
The democratization of retail has decisively transferred the control of the user experience from the retailer to the consumer. While everybody may have their own definition of headless commerce, one thing we can all agree on is that we must embrace the fact that consumers have more access and influence than ever before. Let’s break out of our four walls and meet them on their terms.