November 2, 2016, 12:24 PM

Sponsored Special Report: Why retailers are embracing cloud-based technology

Cloud-based technology vendors discuss how their technology can provide online retailers with new capabilities.

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Meet the next generation of cloud-based e-commerce platforms

Cloud-based technology is more robust, powerful and flexible than ever. Today’s software-as-a-service e-commerce platforms—those that are hosted online and accessed by users via the web—offer a full suite of customizable features retailers can use to create unique, feature-rich websites, as opposed to the cookie-cutter websites that were synonymous with them just a few years ago.

At the same time, cloud-based software and service providers are making it easier for retailers to connect applications they already use, such as shipping solutions and inventory management software, to their website and share data among them in real time. Connecting an inventory management system to the e-commerce platform through an application programming interface allows a retailer to display up-to-date inventory availability to customers on the website, and automatically update inventory counts in the inventory management system after each online purchase.

“Five years ago cloud-based technology was not as open as it is today, which restricted what retailers could do with it,” says Jimmy Duvall, chief product officer for e-commerce platform provider BigCommerce. “Today, the openness of cloud technology lets retailers own the customer experience without having to invest the resources internally to continually develop new technology.”

The growing sophistication of cloud-based e-commerce platforms means retailers have more tools to expand their business to other online sales channels, such as Facebook Inc. and Amazon.com Inc. Making the integration paths to a Facebook webstore and online marketplaces such as Amazon within a cloud-based platform spares retailers the cost of creating and maintaining separate product catalogs for those sales channels in-house or hiring a vendor to do so.

BigCommerce’s platform has ready-made integration paths retailers can use to synchronize their product catalog to Amazon and Facebook without having to write or edit existing code. To use this capability, retailers using BigCommerce’s platform only need to turn on these features in their management dashboard.

BigCommerce’s platform allows e-retailers using Facebook’s Shop feature to checkout on Facebook. Facebook launched Shop in 2015. The feature lets a retailer add a Shop tab to its Facebook page and feature products consumers can buy without leaving Facebook. Through BigCommerce’s integration, all Facebook orders are automatically synced with the retailer’s online store.

“We provide the capability for retailers to manage inventory in one place, push it out to multiple marketplaces and process transactions through webstores in other channels with the flip of a switch,” Duvall says. “That’s a huge plus for retailers looking to grow their business, because they need to be where their customers are online and many consumers shop through Facebook and Amazon.”

One advantage of using web-hosted software-as-a-service programs is they are typically low maintenance for the user. BigCommerce, for example, manages its platform and rolls out updates and new features, like support for Apple Inc.’s Apple Pay payment technology, to users automatically. “Including upgrades like support for Apple Pay on the web into our core platform allows retailers to offer the latest features and functionality consumers expect as soon as they are ready, with little or no effort on their part,” Duvall says. “We make adding new features a series of on and off switches for the retailer.”

As part of its service, BigCommerce performance tests all new features under a variety of conditions and makes sure those enhancements do not compromise data security within its platform before rolling them out to customers. By taking on technology development and platform maintenance, BigCommerce can reduce a retailer’s e-commerce platform costs by as much as 75% compared to developing and maintaining a platform in-house, Duvall says.

Another benefit of BigCommerce’s cloud-based platform is that scalability during peak periods, such as during the holiday season, is included as part of a retailer’s monthly fee. This assures retailers they will have the on-demand capacity needed to handle unexpected traffic spikes that can slow website performance and lead to a poor customer experience.

“With a cloud-based platform, retailers can focus on their core business instead of becoming technologists, which helps them become more successful,” Duvall says.

Consider your options before going to the cloud

Building and managing the technology required to run an e-commerce business is a challenging and complex undertaking. First, there’s hardware, such as the servers that host the site and run the software it needs to run. There are also the myriad software programs needed to run the back-office applications that support the consumer-facing website and other business areas.

Even if a retailer has the financial resources to build its technology infrastructure wholly in-house, it may lack the personnel resources to maintain it.

To overcome such obstacles, some retailers are turning to cloud technology providers for the infrastructure, knowledge and services they need to support their businesses and satisfy customers’ online shopping expectations. Cloud technology refers to computing power, storage and software applications delivered via the internet.

“Most retailers are not technologists, so for them it’s a matter of determining their core competencies, focusing on doing what they do best and outsourcing their IT infrastructure,” says Adam Roozen, a former e-commerce executive in Wal-Mart Stores Inc.’s SamsClub.com division who is now CEO of the e-commerce-focused digital agency Echidna Inc. Echidna provides technology, visual design, digital marketing and strategy consulting services to merchants.

As a cloud-based technology provider and systems integrator, Echidna has a software engineering staff that maintains e-commerce software for a variety of retailers. By servicing a broad customer base, Echidna’s engineers have experience troubleshooting problems that a retailer running its software in-house may not see.

“The more exposure software engineers have to other e-commerce platforms, the better equipped they are to fix problems quickly and take proactive measures to prevent additional potential problems,” Roozen says. “Working on a single platform in-house can limit a retailer’s knowledge of problems that can occur, prohibiting it from preventing and resolving issues.”

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