Amazon not only sold $2.5 billion worth of goods, it introduced Prime members to new services. How should rivals compete in 2017?
E-retailers should avoid the pitfalls that make transitioning to another e-commerce platform painful.
The breakneck pace of technology innovation and changing consumer behaviors is having a profound impact on business. To keep up with business growth plans, competitive threats and consumer demands, online companies must support global markets, digitally empowered customers, and evolving sales and service channels, putting ever-more stress on the e-commerce engine. That's leading online retailers to look for technologies and systems that can handle the stress, and often that means moving to a new e-commerce platform.
That move can be, and often is, complicated. There are more stakeholders than ever, more data, more integrations to complete, and so on. But as e-commerce technology evolves, replatforming initiatives are inevitable. In many cases, the projects run over budget and are delivered late. Talk to any e-business leader who has been through the process and you're bound to hear a war story or two. But understanding the missteps that often happen during the replatforming process can raise the likelihood that a replatforming project will run smoothly.
1. Building the walls before the foundation
The commerce engine requires data feeds and integration points into multiple systems to deliver on its purpose. "Omnichannel" retailing is putting further pressure on the alignment of these systems. Replatforming without a thorough examination of the many systems e-commerce touches will make for a very messy integration process that can be a drag on time and budget.
2. No clear governance structure
Just as e-business teams are having input into other teams, there are more lines of business involved in e-commerce now than ever before. Without an agreed-upon governance structure, time will be wasted looking for the right person to "make the call" (or deciding who that person should be). Delaying implementation—besides requiring a reset of your timeline—significantly affects the overall budget because vendors start charging for support and maintenance from the day the contract is signed, not the go-live day.
3. Failing to develop a rigorous total cost of ownership (TCO) model
Creating a business case for replatforming is standard procedure. However, e-business leaders focused on selecting the right technology often hastily put together a TCO model that lacks reliability. Building a business case on a weak TCO creates a disconnect between upstream expectations and downstream results. Due to factors missed in the TCO phase, projects quickly become over-budget, which then results in cutting the project's scope and dashing expectations.
4. Replatforming without revamping business processes
New technology necessitates a revamp of business processes. Ignoring this planning means you may be forced to customize the solution to fit a process that isn't optimized to the new technology. This results in more latency and more workarounds, all to the detriment of project efficiency and your site experience.
5. Unrealistic expectations
The members of your team all have full-time responsibilities to fulfill in addition to their participation in the replatforming project. E-commerce replatforming takes an average of nine months. Projects that take less time are the exception, not the rule. Promising delivery in fewer than nine to 12 months will set you up for uncomfortable conversations with stakeholders later about the inevitable delays.
6. Going with a kitchen sink approach
It's easy to fall into the trap of looking at countless web sites and collecting a running list of all the capabilities you wish your e-commerce solution could provide. Trying to launch with every stakeholder's wish list of features is a sure-fire way to get your project to run over deadline and over budget.
7. Ignoring data quality problems
E-commerce companies are grappling with the dramatic increase of data they must process and store. Often, back-end data sources lack both the quality and consistency needed to deliver on the objectives of the replatforming initiative. The success of the new platform depends on the quality of the back-end integrations and the quality of the data it will retrieve.
8. Undervaluing testing and change management
Testing, though widely accepted as a best practice, is often hurried or pushed to the end of the project plan. As the go-live date approaches, teams realize they don't have the proper testing environments, that they have limited resources, and/or little time to run the many tests needed to prevent post-launch headaches. If your teams are focused on dealing with problems that testing and change management could have prevented, they'll be unable to keep up with the activities that affect crucial key performance indicators.
9. Launching with a big bang
Considering the risks involved, launching a new e-commerce solution overnight, completely in one shot, is surprisingly common. It's called "flipping the switch" or going for the "big bang," and it often ends up being a replatforming version of Russian roulette. With this strategy, all testing is limited to what's possible in the sandbox; there is no opportunity for end-to-end thorough testing (see pitfall No. 8), which means any number of problems can arise—even, potentially, site failures.
10. Treating replatforming as a project, not a program
Once the platform has launched, e-business professionals can let out a sigh of relief—but only a quick one. As soon as the new platform is live, there will be enhancements to make, new stores (brands, markets) to bring onboard, code refactoring to do, back-end plumbing fixes to make, and so on. Furthermore, by the time the platform sees the light of day, it will already be time to upgrade. The last thing e-business teams want to do is get stuck again on an outdated or legacy version of their shiny new platform.
Remember, a car needs more than an engine to both function and be used to its full potential. You may buy the Ferrari of all e-commerce platforms, but without the proper preparation, all it will do is allow you to drive off the cliff that much faster.