The digital commerce landscape is far from static. In it, a new paradigm known as “headless commerce” is gaining significant traction.
But what, exactly, is headless commerce?
As Andrew Gordon, eCommerce payments strategist at Discover® Global Network (DGN), explained to PYMNTS, headless commerce empowers merchants to adopt a more agile and innovative approach to eCommerce, leading to better customer experiences. customers across all channels. Headless commerce is an architectural approach to eCommerce where the front-end (customer-facing) and back-end (business logic and operations) parts of a platform are separated.
In traditional eCommerce setups, the front end and back end are tightly coupled, meaning that changes in one part can affect the other. This integration often leads to limitations in customization and a slower response to technological advances or customer demands. For example, updating a feature may require extensive platform-wide changes, making the overall system less agile.
“Headless commerce is about separating the customer-facing elements — the look and feel of a website — from the back-end systems that manage business functions like inventory, checkout and payments. This decoupling is achieved through APIs, which connect these two layers,” said Gordon.
This separation allows for greater flexibility and customization, as businesses can independently manage and update the user interface and back-end system without disrupting the entire platform.
And in a fast-moving commerce landscape where the competition is just a click away, headless commerce is proving essential for merchants looking to meet their customers’ needs while driving more viscosity and retention.
Headless Commerce and the Transition From Traditional eCommerce
While to the uninitiated the term headless commerce may seem like a buzzword, its implications are far-reaching, and they are already changing how businesses and consumers interact in the digital marketplace.
Among the main benefits of headless commerce is the game-changing but simple fact that it allows businesses to choose the best tools and technologies for each part of their system.
For example, as Gordon highlighted, a merchant may need to connect their mobile app and desktop store to both customer relationship management (CRM) software and a payment gateway. With the API-based architecture of headless commerce, this is possible.
Additionally, this level of configuration can also be applied to back-end services that help merchants operate their digital experiences. The flexibility of headless commerce allows companies to leverage best-in-class capabilities — for example, a CRM, payment solutions or even shipping software — right into their headless commerce solution. This ability for customization is similar to building with Legos, where different pieces can be assembled in different configurations, in this case for business success.
“Out-of-the-box eCommerce platforms often restrict businesses to the features they offer, limiting customization. Headless commerce breaks this limitation by enabling businesses to design their front-end experience across multiple channels — whether desktop, mobile app or kiosk — while maintaining a consistent back-end system,” he said.
This flexibility also extends to incorporating new technologies and customer engagement strategies.
For example, Gordon said businesses can quickly adapt to emerging trends such as augmented reality (AR) for virtual trials or implement advanced artificial intelligence (AI) customer service bots.
The ability to provide a consistent experience across all touchpoints is essential in today’s omnichannel retail environment. As consumers increasingly expect seamless interactions, whether they shop online, on mobile devices or in physical stores, headless commerce enables businesses to meet these expectations more effectively, Gordon said.
Future Trends in Headless Commerce
The growing adoption of headless commerce and its flexibility has lowered the barrier to entry for businesses interested in this approach. Its benefits are no longer limited to tech-savvy startups or businesses building a new online architecture from scratch.
“We are seeing a significant shift as legacy eCommerce platforms adopt headless commerce strategies. This trend indicates a wider acceptance of the model, making it more accessible to mid-tier companies and even some smaller businesses with sufficient development resources,” Gordon said. .
He added that there are four key trends and innovation pillars that will support the expansion of headless commerce while developing a broader ecosystem of compatible tools and services: API-driven innovation, next-generation applications of artificial intelligence (AI) and machine learning, the convergence of social media and eCommerce and the integration of payment innovations.
APIs are the backbone of headless commerce, allowing different systems to communicate and share data for services such as personalized recommendation engines or advanced analytics platforms, says said Gordon. He believes that as we see the digital space and payments ecosystem continue to expand, APIs will be an important part of that growth.
Powered by API connectivity, merchants can have the ability to use AI and machine learning-powered tools to further benefit their customers. This can range from an AI chatbot that handles customer service questions on a website to a powerful product recommendations algorithm that increases sales at checkout.
Another space that benefits from improved connectivity through APIs and headless commerce is the relationship between eCommerce and social media. As more and more buyers turn to influencers and social media for product recommendations, merchants have more tools to convert consumer interest into sales by directly connecting their social media presence to their eCommerce site. The flexibility of headless commerce also extends to payment systems, and businesses can integrate different payment options, from digital wallets and buy-now-pay-later solutions to cryptocurrencies, catering to a diverse range of customers.
The best part? These innovations can be seamlessly integrated into the existing system without modifying the back-end infrastructure.
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