The 2021 holiday shopping season is predicted to yield the highest retail sales on record. According to the National Retail Federation (NRF), holiday sales will grow between 8.5% and 10.5% compared with last year.
McKinsey confirms there will be strong consumer demand throughout November and December, predicting a 7% increase in retail sales from 2020.
Driven by the rampant news of supply chain issues, staffing shortages, and probably shipping delays, shoppers are embracing omnichannel experiences. They’re also starting their holiday spending earlier than usual.
This year (perhaps more than others), retailers need to account for all of this, plus an increasing lack of consumer loyalty when it comes to brands, merchants, and products. Consumer are much more apt to shop around for what they need, with 70% of the 2100 shoppers surveyed by McKinsey indicated they readily switched brands or retailers in the past three months when an item they wanted was out of stock,
For retailers facing what’s shaping up to be an unprecedented holiday shopping season, a headless commerce approach offers greater resilience, flexibility, and scalability to address increased consumer demand, supply chain issues, stock shortages, and shifts in consumer shopping behavior.
What is headless commerce?
Headless commerce is a digital commerce strategy that decouples the frontend, client-side commerce experience (e.g., “the head”) from the backend, server-side data layer that processes orders, stores customer information, and manages inventory data.
In a traditional digital commerce approach, the frontend and backend systems are tightly coupled together. This requires your development team (or IT consultants) to make updates to both sides of the commerce ecosystem. Testing new experiences and making content changes can be cumbersome and difficult to execute, hindering agility.
Likewise, adding new functionality to the backend can compromise frontend performance and experiences (e.g., by decreasing page speed and introducing design inconsistencies or security issues.)
By decoupling the frontend from the backend, headless commerce enables marketing, brand, and sales teams to rapidly test and deploy new designs, marketing copy, templates, and offers without the need to get IT or development teams involved.
This frees up development time to focus on backend systems (e.g., website functionality, security, data storage, etc.), enabling you to be much more agile when addressing shopper needs, especially around the holiday crunch time.
The key features in a headless commerce platform include:
- An API-first infrastructure that enables seamless integration with critical retail systems like CRM, CMS, ERP, and warehouse management systems.
- A microservices-based architecture with a modular approach which enables users to access the products, services, and capabilities they need as they need them.
- Unified commerce functionality that connects and facilitates consistent shopping experiences across multiple touchpoints (e.g., in-store, website, mobile app, social app, IoT, and ecommerce marketplaces like eBay and Amazon.)
- Flexible order management from a single unified catalog so you can offer multiple fulfillment options, optimize inventory across your entire fulfillment network, reduce shipping costs, and deliver orders faster.
- A flexible environment that gives your marketing and merchandising teams the power to optimize the front-end shopping experience, while freeing up developer time to focus on back-end functions and functionality.
Headless commerce ensures that merchants are engaging with customers across all channels and touchpoints. With your front end decoupled from your back end, your marketing team is free to test and deploy effective shopper experiences while your development team is free to add functionality and interface changes on the backend.
Expect the unexpected during the holidays
Based on recent data from McKinsey, the NRF, Deloitte, and many other sources, we know that consumer demand over the 2021 holiday shopping season is—and will continue to be—strong.
Consumers are optimistic about their ability to spend this year which translates to double-digit growth for many product categories including sporting and retail apparel, cosmetics, software, and electronics.
We also know that consumers have increased their omnichannel shopping behavior significantly over the past 18 months. This promises to be the norm throughout the 2021 holiday shopping season, with roughly 70% of McKinsey respondents planning to take an omnichannel approach to holiday shopping, and nearly half saying they plan to spend more than last year.
While predictions about consumer intentions can help set retailer expectations, they only go so far. Supply chain issues are predicted to impact the availability of popular items from iPhones to toys to holiday turkeys. As the holidays draw closer, in-store shopping will likely increase thanks to the widespread availability of covid vaccines and the fact that USPS, UPS, and Fedex are not guaranteeing specific delivery times.
The best way to combat uncertainty is to be prepared for anything and everything. This is where headless commerce truly shines.
How headless commerce enables holiday readiness
The key benefits of a headless commerce approach directly address the current uncertainties surrounding this year’s holiday shopping environment because they contribute to holiday readiness in a few very specific ways. These include:
- Flexible frontend development: API-first headless platforms allow retailers to ensure customers can purchase products from anywhere. Marketers can tailor experiences without the need to pull on development teams, for example, by creating unique holiday-focused shopping offers and content based on real-time inventory, demand, and shopper behavior.
- Unified inventory management: Real-time inventory management will be critical this year. A headless commerce system enables retailers to manage all available inventory from a single catalog, regardless of where products are sold. Catalog updates are done in real-time using API calls, ensuring that customers have the latest product availability information whether they’re shopping on your website, app, or in a third-party marketplace.
- Superior customer experience: Headless commerce supports multiple platforms and tools that contribute to better, more personalized customer shopping experiences. The API-first, microservices architecture makes it easy for developers to add features like personalized product recommendations, audience-targeted promotions, recommendations based on past purchase behavior, and relevant substitutions/recommendations when an item is out of stock.
- Flexibility for developers: Headless commerce frees backend developers to focus on developing and introducing features that foster engagement and create excitement. For example, you can connect your shopper rewards program to your omnichannel commerce experience, enable social selling, and unify shopping channels like mobile and web commerce sites.
The right tools to support holiday sales
Headless commerce gives retailers the freedom to design custom front-end shopping experiences with less disruption than full replatforming.
Kibo’s headless commerce platform takes a hybrid approach in that we allow frontend and backend communication, providing tools marketers need to deliver personalized client-side experiences while fully supporting and enabling backend commerce infrastructure.
City Furniture, a furniture brand with showrooms in southwest and central Florida, selected Kibo’s headless, micro-services ecommerce offering last year. City Furniture needed to design pages, marketing content, and promotions for high-value products.
The furniture retailer has a complex set of requirements around discounts and offers combined with an omnichannel customer journey that includes their website, physical showrooms, and multiple brands. They were attracted to Kibo’s headless commerce approach because it offered flexible modular design, rich customization, and comprehensive documentation and support throughout the entire selection and onboarding process.
Kibo’s API-first headless commerce platform gives both B2C and B2B merchants the tools to sell anywhere and everywhere. Contact us to learn more about the power of headless commerce, speak with a member of our team, or better understand how your customers can benefit from a headless commerce approach.