Beyond Digital by DMI #02: The Commerce Tools of Tomorrow

In this episode of Beyond Digital, we’re joined by DMI’s Mike Graziano and the CPO of commercetools, Kelly Goetsch.

Kelly is the Chief Product Officer at commercetools and co-founder of the MACH Alliance. He’s a four time O’Riley author on commerce tech, is the Co-Host of the “Commerce Tomorrow” podcast, and has previously worked as Oracle’s microservices lead and senior architect at ATG.

Mike Graziano is DMI’s SVP of Global Sales & Alliances, for the Digital Commerce Group.  “Graz,” (as he’s been known for 24 years in the industry) has extensive experience in commerce, alliances, and sales to drive growth for the company. His career path spans from tanks to technology, as he served as a tank platoon commander in the United States Marine Corps, later entering the tech sector in the dot.com era of the mid-90’s.

Today we’ll discuss all things commerce and MACH strategy, from microservices, API-first strategy, cloud-native multi-tenant SaaS and headless architecture…to MACH speed deployment, customization and their impact on the customer experience.

THE TECHNOLOGY LITMUS TEST: WHAT DOES MACH MEAN? – 2:30

MACH stands for Microservices, API’s, Cloud Native, multi-tenant SaaS and Headless architecture. At Commercetools, Kelly and his team came up with the term in 2017 as a way to group all the modern commerce technology they were using in their branding. They worked with a group of partners to create a standalone entity, the MACH Alliance, to educate people on what MACH means. Now, they have 31 members and counting. The four pillars of MACH, Kelly explains, are what allow commerce companies to iterate constantly, “and iteration is a precursor to innovation.”

THE “UNBOXING” OF MODERN COMMERCETOOLS       – 11:39

Kelly explains that there are some companies that are so big that it makes more sense for them to build their own commerce platforms from the ground up; take, for example, Amazon or Walmart. Commercetools fits in just below that segment.  Their customers don’t want an “all-in-a-box” solution. Commercetools provides tools to create unique solutions, tailored to each and every customer.

COMPOSABLE COMMERCE – 13:12

Back when eCommerce was just beginning to become popular, companies would often purchase all-in-one services, from merchandising, to search, to personalization, to CRM. Now, Kelly says, ecommerce companies are “growing up,” having operated in the industry for 20+ years. With public cloud offerings, Kelly explains that you can now have a company founded by two people in a dorm room pay for what they need from cloud services as they grow their business. The benefit of composable commerce is that you can now assemble all the parts of a successful ecommerce platform between in-house, partners such as DMI, and vendors like Commercetools in a “LEGO block-style collection.”

A LEADER IN B2C COMMERCE – 16:45

Kelly says that Commercetools created their own market. There was no demand for or knowledge of Headless Commerce before 2013. Kelly and his team saw a need to move faster in the industry as companies like Amazon zoomed ahead. They started by lobbying analysts, speaking at conferences, and before they knew it, Commercetools was earning its first big customers like Express, LEGO, and Burberry. Word spread in the industry, and now their product has become the standard approach. Several legacy vendors have tried to modernize by moving to the cloud, Kelly says, but if their legacy platforms were created before 2008, there’s nothing truly innovative or “cloud” about them.

“IF IT WAS BUILT BEFORE 2008, IT’S NOT CLOUD. IT’S HOSTED SOFTWARE.” – 22:18

Commercetools is a true SaaS-based product, meaning that they do not do upgrades. Real SaaS operates without need for upgrades; you log in one day, and there is new functionality. That’s real cloud, according to Kelly. When you contract with Commercetools, they will do everything to meet your goals, and if they don’t, you won’t have to pay. Commercetools is not a platform, it is a collection of APIs.

THE EXPERIENCE ECONOMY – 24:40

Iteration is innovation, Kelly says. To make sure your customer experience is as seamless as possible, you can release a new feature, test it out for a week, and iterate a new version by the end of that week, rather than iterating once a month or once a quarter. “If you’re using a monolithic platform, you’re deploying to production once a month.  If you’re Amazon, you’re deploying once a second.”

THE FUTURE OF COMMERCETOOLS – 27:25

Legacy vendors have pioneered the space, Kelly says, but now their time has passed, and Commercetools is in a great spot. Covid has changed who might be in the market for ecommerce services, and in many ways accelerated the progression of the space. There are so many new players in ecommerce like car companies with connected car offerings and massive media companies. Kelly believes the big cloud providers like AWS and Azure will begin to offer their own commerce APIs, much like they do for AI. He also says to look out for the growing adoption of GraphQL, an open-source query language for APIs used for front-end development.