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Considerations when selecting a SaaS eCommerce vendor

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With retailers putting their eggs in one basket with flexible, scalable, out-of-the-box Saas eCommerce solutions, it is important that all things are considered during the vendor selection phase. This ...

With retailers putting their eggs in one basket with flexible, scalable, out-of-the-box Saas eCommerce solutions, it is important that all things are considered during the vendor selection phase. This presentation outlines key things to consider when you are selecting a SaaS eCommerce vendor/platform.

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  • 4. Talk about self
  • A unique position in the organisationGenerally have contact with most of the teams in the organisation, with the remit of delivering everything for everyone when it comes to eCommerce projects
  • But that’s a hard thing to achieve1. Historically platform selection is balance between flexibility and cost - they can be delivered as on-demand solutions or licensed/on-premise solutions - Some platforms come ‘out of the box’ with preconfigured functionality and integrations and others verge on a fully customisable toolkit for building your ecommerce site. - Customisable solutions are more flexible to develop but at a greater cost of ownership - on demand solutions have a lower set up cost, quicker time to market but at the expense of flexibilityHowever the delivery models of SaaS is beginning to blur the boundaries between the delivery and type of solution… and hence reducing the need to offset cost and flexibility against each other
  • 2. This is how delivery models are evolvingBecause the delivery models have evolved from the old world of custom build, on-premise component based solutions with ‘CPU’ pricing. To Managed or SaaS solutions with lots of components rolled-into-one usage based pricing With on demand solutions, all these components are rolled up into a single monthly, quarterly or annual fee, usually based on some sort of volume (visitors, orders). Maintenance, upgrades, base functionality and infrastructure are all managed by the vendor.Custom: Applications and services are developed entirely by the retailer or a third party to the retailer’s specifications. Application is owned by the retailer and is not commercially available for license to other retailers. The retailer or third party is responsible for ongoing maintenance, enhancements, and problem resolutionLicensed: Applications are licensed for usage from an ISV. The retailer typically pays a onetime license fee and annual maintenance fees, which provide ongoing enhancements, bug fixes, and patches. Licensed applications are supported on hardware platforms operated by the retailer or outsourced to a provider selected by the retailerManaged Services: The retailer pays a third party, often the license ISV, to host e-commerce applications. The managed service provider takes responsibility for installing software, hardware, and upgrades, working to achieve a negotiated SLA. Managed services can support either custom or licensed applicationSaaS: The retailer pays for the usage of applications from a SaaS provider. SaaS providers offer either hosted e-commerce solutions only, or can be an ISV that also provides managed services for its licensed applications as a deployment option. In both managed services and SaaS options, the retailer typically takes responsibility for customization, loading and maintaining the data, reporting and analytics, campaign development, and delivery
  • 3. In the world of SaaS the word ‘enterprise’ is becoming irrelevantThe CIO likes the word enterprise… but I don’t
  • Because the word enterprise means different things to different peopleThe CIO needs reliable, robust and low risk software, and in the old world of on-premise licensed software ‘enterprise’ software was the answerVery ImportantVery bigVery secureLots of clientsBut for the business users it meant:Reliability over flexibilityIT admin over business userIntegration over customizationSecurity over practicalitySaaS delivery models have removed the reliability, support and security risks away from the organisation… its about web services and SOA, a mash up of disparate solutions rather than the physical containment of them in an organisation
  • So Enterprise means nothing in a SaaSeCommerce, a true SaaS solution can scale to whatever size you want it to
  • Gartner says SaaS is becoming pretty important in the eCommerce spaceI can vouch for that from my experienceChances are yourselves or someone in your organisation is thinking about investing in a SaaS solution – you may even use one already and not really know it.
  • it’s a very confusing market, with lots of new terminology. It’s a sales persons dream!On demand: delivers capacity when the retailer needs it, e.g. Christmas peakAutomated upgrades: Free upgrades several times a year providing additional ecommerce functionality on a frequent basisMerchandiser and developer control: The detachment of the infrastructure puts all focus on the business tools used to control the site, so the focus can be on merchandising and sophisticated customization. Perfect for a reactive industry like retail where differentiation and keeping one step ahead is a major success factorAccess anywhere: being in the cloud, SaaS applications can be accessed anywhere through a browser/web connection. No need to go through an IT root canal to get VPN access.Multi-tenant architecture: drives cost efficiency for retailer when run on a single instanceLow total cost of ownership: customer does not assume ownership for maintenance and installation and associated costsEconomies of scale passed to the customer: such as IT resources for support that can be called in on an as needed basis rather than internal resources
  • And its easy to make mistakesSo here are 6 lessons learned from my experience, I hope they are helpful to you all
  • 1. If you are thinking about replatforming onto a SaaS platform, or assessing the vendors out there it is important to define the scope of what you are actually trying to deliver
  • There is always a risk you can get down the line in a re-platform project and realise that the solution you have signed up to doesn’t do what you assumed it would, or at least not the way you thought it would
  • 2. an ecommerce or multi-channel platform means different things to different peopleAsk your IT guys, they’ll say it’s a commerce engine. Ask your web team, they want merchandising tools. Ask marketing, and they want CRM capabilities.I’ve had experience where people have heard about a solution we have been procuring and actually assumed it delivers something they are looking forIts really important to define your customer and business mission statements for any platform selection, and stick to itAsk the ecommerce software vendors, and they’ll tell you it does everything perfectlyImportant rules to make sure the solution or platform your are buying into meets your business needs:Clearly defined objectives and share this across all departments (IT, business, marketing) on what you are ‘replacing’ or ‘enhancing’
  • 3. And if you are thinking of SaaS, it’s a good opportunity to consolidate your platform ecosystem into a truly web service based oneLook at existing processes and systems and consolidateDon’t get stung with additional solution procurement and integration down the linePreintegrations and get as many products within the same solution as possible otherwise integration becomes an issue and reduces the benefits of the SaaS offering
  • And talking of what the platform means to different departments, its really important to start any selection process with the business user at the forefront of your mind
  • 1. In the old world of ‘Platforms as a Product’ in the on-premise world there was heavy IT involvement in projects, especially due to the fact that hosting of the application was so tied up with what it could do
  • 2. But that’s all changed now. So be absolutely clear what you can do with your new platform! Define lots of business user use cases and make sure it ticks the boxes! All the things on the left should be business configurable tasks with NO IT INVOLVEMENTWhat business tools do the web team currently use to manage the websites?What are the pain points with these tools?What additional capabilities do they require?What level of ability to you need to develop on your new platform?
  • 2. Because the business user tools (and these could be web merchandising teams or front end deveopers) enable you to do a lot with your platformWeb teams tend to focus on the delivery of the front end of a website. Its not surprising given how prominent it is in the organisation and how tightly coupled it is to trading and ultimately profit. But to create storefronts, you need tools. So make sure whatever you are going for has the tools to enable you to create unique storefrontsSo make sure you know what tools are available to your business and development teams to create your propositions
  • Which brings us onto the next point. Its really important to define what ‘out of the box’ means when selecting a SaaS provider
  • Because you never know whats in there unless you have a look, you could be in for a nasty surprise
  • 1. SaaS ecommerce platforms solution should enable a level of customizationBut be warned – customization = cost!
  • 2. Its always valuable to ask for a reference application. When assessing any ‘out of the box’ or reference application functionality, make sure you remember the 80:20 ruleYou may find that only 20% of your total platform requirements are catered for in the reference application, and 80% is irrelevant to your business needs.Make sure you ask for a reference application – and not just a demo! Hands on experience with the tools before your buy them is important.Try-before-you-buy, evaluation versions are always great way to eliminate the initial hurdle. 
  • 3. Also consider the interpretation of ‘out of the box’ requirements. Here is an exampleDetail vs high level, heres an exampleWhat functionality does your business require?What does the reference application deliver ‘out of the box’ in terms of functionality?What will you use out of this?Assess the deficitGet into a low level of detail certainly around data structures.
  • The on demand nature of aSaaS platform means that you should in theory by able to benefit from automated upgrades and additional functonality delivered in a rolling schedule of roadmap releases.
  • Define your platform roadmap. Be concise about what you want to deliver in terms of your ecommerce platform.I find a good way of doing this is to split it into three – look at your strategic business goals, and align these with business user and customer use cases relating to your platform. Conso0lidate these into a roadmap document and prioritise/phase accordinglyProduct roadmap release scheduleDefine your business roadmapMatch yours against theirsWhat about third party preferred integrations?Is an acquisition on the horizon?
  • 2. You then have a basis to look at your technology reoadmap and plot against theirsTwo things to noteFirst that in the long term, your roadmaps may end up diverging away from one another, meaning you have to build more and more customisations in the long run. This defeats the point in SaaS – where you should get benefit of regular product developments
  • 3. Another thing to note is the time it actually takes to take advantage of new product releases. Generally a SaaS vendor will take care of upgrades of their core reference application. Anything additonal may end up either costing money to upgrade of If you have overcustomised your platform, it may take longer to upgrade to the same level of functionality as the reference application.Get a product roadmap release schedule and match it against your roadmap. Try and align it as much as possible – for example if you want a certain feature now, rather than customising it you might wait until it comes as part of the platform.
  • SaaS platforms take the performance cosiderations out of the hands of the retailer. This is great, as it reduces the need for IT involvement, infrastructure investment, monitoring, load balancing, scaling etc
  • So when a SaaS vendor says they have a global datacentre, make sure global really does mean global.Especially important when you are setting up multi-territory websites. E.g. if the hypothetical cloud is based in the States, and all your sites are european, then you may have problems with latency and performanceWhat is my website(s) domain(s)?Which countries will customers access it from?Where are the servers?What about DR and backup?
  • 2. Black cloud rained on our party when we realised a. our global datacantre was actually all based in the states and content delivery wasn’t included. Can lead to massive costs in the long run. As far as I’m concerned if a vendor offers a fully fledged SaaS platform they should include CDN.What is my website(s) domain(s)?Which countries will customers access it from?Where are the servers?Is content caching included?Never underestimate performace considerations even on the cloudDR and backup
  • Market moving, dynamic – depends on what your site can currently doHow far can you push existing platformWhy is this important?You will migrate your web platform, there is no doubt about it. You probably won’t be around in 3 years and neither will most of your team, the people that helped you procure it.Make your replacements lives easierIP – you technically don’t own any of the platform out of the box. Make sure contractually your customizations and storefronts are Interllectual Property. Cost of ownership may be low but IP gains are also low.Web services – takes some functionality out of the realm of your web platform (e.g. ratings and reviews, maps, rich media). Reduces the risk factor when migrating away from your commerce platform. Independent
  • Market moving, dynamic – depends on what your site can currently doHow far can you push existing platformWhy is this important?You will migrate your web platform, there is no doubt about it. You probably won’t be around in 3 years and neither will most of your team, the people that helped you procure it.Make your replacements lives easierIP – you technically don’t own any of the platform out of the box. Make sure contractually your customizations and storefronts are Interllectual Property. Cost of ownership may be low but IP gains are also low.Web services – takes some functionality out of the realm of your web platform (e.g. ratings and reviews, maps, rich media). Reduces the risk factor when migrating away from your commerce platform. Independent

Considerations when selecting a SaaS eCommerce vendor Considerations when selecting a SaaS eCommerce vendor Presentation Transcript

  • Considerations when selecting aSaaS eCommerce vendorBen Adams
  • Who Am I?Supporting the development of common processes, capability and technologyacross EuropeProduct owner for the European eCommerce platformRepresent the business user and customer in selection, business andtechnical requirements definition and delivery of the web platformHave experience implementing, managing and using SaaS eCommercesolutions at 3 major retailers
  • Where do I sit? Business I.T. Commercial System Platforms & Web Teams Teams Integrator Solutions Enterprise Legal Procurement Architecture Ben Customer Customer Customer Experience Research Storefronts CRM
  • A balance between flexibility and cost Licensed Software Higher set up costs On More Flexible Demand Out of Fully the box Customisable
  • Licensed Software is “so last season” Custom Licensed Managed SaaS Component, CPU Rolled-into-one usage based pricing based pricing More retailer Less retailer involvement involvement
  • ‘Enterprise’ licensed softwareCIO Paranoia Number of mentions of ‘enterprise’ in a sales pitch
  • What does ‘enterprise’ actually mean? To the CIO To the Business True in the world of SaaS removes these issues as it takes licensed, on premise the reliability, support and security software aspects away from the organisation
  • Enterprise means nothing in true SaaS eCommerce
  • “By 2013, 40 % of e-commerce deployments will use a complete SaaS e-commerce solution and 90 % of e- commerce sites will subscribe to at least one SaaS- based service” Gartner Inc, SaaS Impact on eCommerce, 2008
  • It’s a confusing market… Merchandising On Demand Multi-tenant Control delivery model Automated Access upgrades anywhere Out of the box Low TCO Low Risk
  • …and easy to make mistakes 6 Lessons Learned
  • Lesson 1Define the platform scope
  • “It’s not a CMS?!”
  • A platform means different things to different people I.T. Commercial Marketing Web Team FinanceCommerce PIM DAM CMS Reporting Engine Search Promotions CRM engine MV Testing Engine engine Personalisation engine
  • Benefits of a consolidated platform ecosystem Social Promotions Targeting CRM Testing Reporting Merchandising Product
  • Lesson 2Start with the business user
  • The old world of platform as a product Business IT Promotions Sites Product info New pages Banners New Layouts Transactional capabilities SEO Widgets Microsites Analytics Tagging Integration Hosting
  • The new world of platform as a service Business IT Initial set up Legacy system integration Sites New Pages Layouts Transactional capabilities SEO Widgets Microsites Analytics Tagging
  • Never underestimate the bits the customer can’t see StorefrontsIt is relatively easy to create Website Facebook Mobilethese when you have theright business and developertools In store Affiliate Call Centre Business & Developer toolsThese tools enable you tocreate and manage APIs Merchandising Personalisationstorefronts Promotions Testing Reporting
  • Lesson 3Define ‘out of the box’
  • What’s in the box?
  • You will never get everything out of the box CustomizationsThe splitbetween thesecould be costly Reference Application Back office Integration layer Back end
  • Ask for a reference applicationThink about the 80:20 rule… Reference app Reference Business functionality Application you actually use requirements
  • Requirement: the platform should cater for a telco datamodel ‘Out of the box’ Client interpretation Phone Phone Tariff Tariff Bolt-ons Bolt-ons Insurance Customisation is costly and causes problems down the line with ‘out of the Bundles box’ upgrades Sim only
  • The best of both worlds… Truly Unique Storefronts Standards based server side script Standards based client side script support DEVELOPMENT APIs TOOLKIT Web services Business configurable data model extensions and business logic, True multi-site and international Reference application
  • …and don’t forget about pre-integrations ATG Commerce ATG Content Admin ATG Business Control Centre (BCC) ATG Search ATG Customer Intelligence Middleware Retailer applications and web services
  • Lesson 4Ask for a Roadmap
  • Be thorough when defining your roadmap Strategic Business User Customer Roadmap
  • A product roadmap does not necessarily mean more capabilities Client requirements Customisations = costCapabilities Vendor roadmap Time
  • Regular relevant product releases and consider upgradeimpact of customizations This usually varies according to the amount of customization you do Vendor roadmap Client roadmap Time
  • Lesson 5Think about performance
  • A ‘global’ datacentre…
  • …and don’t forget content caching and delivery CDN
  • Don’t get stung by boring compliancy issues down the line VAT Distance selling
  • Lesson 6Shape your organisation
  • Your organisation – is it ready for SaaS? WaterfallHere you will strugglewith time to market Longer time to marketThis is the perfectbalance between time tomarket and businessflexibilityHere you will struggle Agile Reduced flexibilitywith constant change Develop Fully In-house Outsource
  • It is fashionable to migrate your web platform “you generally migrate your web platform every 3 or 4 years”New web platforms Changes in leadership
  • SaaS doesn’t mean no portability
  • Picking a SaaS eCommercevendor is easy
  • Things to look for in a vendor pitch or RFI response Focus on value and not just cost No mentions of the word ‘enterprise’ Live reference application demo deployed on their cloud Clear roadmap focused on delivery of business capability and not just gloss Pre-integrations with other Third Party solutions Developer tool-kit based on open standards Robust, global infrastruture including DR, CDN Security ‘out of the box’ Clear platform scope An agile way of working
  • Thanks for listening! Ben Adams benadams1@gmail.com /in/benjadams @benadams2009