What Is an E-Commerce Platform? Tips for Retailers
Changes in the e-commerce landscape have drastically altered how businesses operate, highlighting the differences between retail and ecommerce while creating new opportunities and challenges for retailers.
If you are a new retailer in an ongoing endeavour to expand through e-commerce or an existing business firm trying to fine-tune an already existing e-strategy, knowledge of the basic e-commerce platforms is significant. These platforms provide essential tools for managing online operations, offering key components of building an online presence, making shopping easier, and creating more positive consumer experiences that drive growth and customer loyalty.
This guide will walk you through the fundamentals of e-commerce platforms, how they support modern retail, and the various types available, helping you choose the right one for your business.
What is an e-commerce platform?
An e-commerce platform is a software solution built to allow retailers to create, manage, and optimise their online activity. It covers aspects of product display, sales, transactions, inventory management, customer interaction, and other key features necessary for online sales. Ecommerce solutions allow companies to run smoothly while giving consumers a pleasant buying experience by combining these necessary technologies into a single system.
Some of the well-known names in e-commerce platforms are:
- Shopify: Ideal platform for medium to small businesses that want to set up an ecommerce store quickly with customisable templates and a wealth of available apps to extend functionality.
- Magento: A more advanced solution for bigger enterprises needing advanced customisation and scalability to manage arduous processes.
- WooCommerce: A plugin dedicated to WordPress sites, allowing CMS users more control and flexibility.
- Alibaba: A worldwide market platform designed for organisations, it enables enormous scope item sourcing and B2B (business-to-business) exchanges.
These systems cater to different strategic business goals, enabling retailers to select the platform that corresponds best with their business goals, size, and audience.
Why do retailers need an e-commerce platform?
As more and more people are buying online, e-commerce platforms have turned out to be an indispensable tool for retailers. The advantages range from smoothing out operations, reaching a wider audience, and adapting to evolving customer requirements quickly and at scale.
Below are the key reasons why retail ecommerce platforms are indispensable:
- Multiple functionalities in one tool
- Expanding market reach
- Customer convenience and accessibility
- Scalability
- Enhanced analytics and insights
Multiple functionalities in one tool
E-commerce platforms centralise all vital components of online retail—secure payment gateways, real-time visibility in inventory levels, comprehensive product listings, efficient customer support, and customer reviews — into a single technological ecosystem. Plus, they streamline operations, improve overall efficiency, and minimise errors throughout the processes.
Expanding market reach
An e-commerce business helps in breaking the geographical barrier whilst making sales amongst customers across the globe, helping understand the global omnichannel shopper. Cheaper, faster international shipping also opens up opportunities for retailers to serve new markets for more varied audiences, even 24 hours a day, 7 days a week, across all time zones, quickly multiplying the potential for revenue.
Customer convenience and accessibility
E-commerce provides the highest level of accessibility, offering customers the ability to browse, shop, and make purchases at their convenience, from either a desktop or mobile device. These platforms improve customer satisfaction and loyalty with features such as multiple payment options and simple interfaces and checkout pages.
Scalability
Built to scale with your business, these platforms seamlessly accommodate higher traffic, larger order volumes, and more extensive product catalogues. Be it managing a seasonal sale or a sudden surge of sales due to exponential business growth, e-commerce platforms ensure that all of these operations run smoothly and remain responsive to customer demands.
Enhanced analytics and insights
Many platforms have built-in analytics and SEO tools that can strengthen your marketing strategy and turn useful insights into inventory performance, sales trends, and consumer behaviour. Stores can also analyse this information in order to enhance their tactics, optimise their stock inventory, and, at the end of the day, provide a more personalised shopping experience to all customers. The result? More engagement, more money in the till.
The different types of retail e-commerce platforms
Retailers can choose from various retail ecommerce software, each offering unique features and benefits.
These include:
- Software as a service (SaaS) E-Commerce platforms
- Open-source self-hosted e-commerce platforms
- Headless e-Commerce platforms
Software as a service (SaaS) e-commerce platforms
SaaS (Software as a Service) is usually a subscription-based, cloud-hosted e-commerce solution that allows organisations to operate their online business without dealing with infrastructure or complex technical configuration. These platforms often come with tools for abandoned cart recovery, helping businesses recover lost revenue by reminding customers to complete their purchases. E-commerce SaaS platforms are reached through a web browser, so no special tools are needed outside of your already available ordinary-use hardware.
This makes literally any computer that connects to the Internet your shopfront—just plug in and go without even setting foot outside. Even users without technical training may set up shop with a few clicks because of the user-friendly interfaces that allow them to easily manage their inventory management systems, accept payments, and design their products. Shopify and BigCommerce are two widely adopted examples of SaaS e-commerce platforms.
Advantages of SaaS platforms
- Keep on track with the updates: This is one of the main benefits of having a SaaS platform, the provider is continually updating it. These updates generally come with new features, bug fixes, and crucial security patches. Businesses utilising SaaS platforms don’t have to worry about manually installing updates or there being any upkeep required for the system. This ensures that all features and capabilities are current, competitive, and secure. Shopify and BigCommerce automatically ship new features, allowing retailers to utilise the latest tools available to optimise their online store and improve the customer experience.
- Low maintenance: Many operations can be offloaded to the host. By handling all infrastructure, hosting, and software installation and maintenance, the provider allows retailers to focus on their core business instead of worrying about technical back-end operations. In this scenario the system takes care of itself; maintenance becomes trivial. For small to medium businesses without an IT team, it allows them to run an online retail site smoothly without much technical intrusion.
- Enhanced security: In particular, the issue of security is a highly important one for online businesses, who bear the responsibility of protecting sensitive customer data as well as their own operational details. E-commerce platforms SaaS are designed with security features built in, such as meeting payment standards, including PCI DSS (Payment Card Industry Data Security Standard). It means that customers’ financial information is processed securely through payment transactions. In addition, SaaS vendors generally provide SSL encryption, secure payment gateways, and tools to protect both the business itself and its customers at large.
The biggest advantage of SaaS e-commerce platforms like Shopify and BigCommerce is that they deliver a very efficient, secure, and scalable solution for businesses that want to create and grow their online stores without requiring deep technical skills. These platforms offer the flexibility, support, and dependability that contemporary merchants require to thrive in the competitive e-commerce market.
Open-source self-hosted e-commerce platforms
Open-source, self-hosted e-commerce platforms give companies maximum control over website hosting, with greater customisability and flexibility to manage an online store. Unlike SaaS platforms, self-hosted open-source systems provide web hosting that can be directly managed by the operator.
In layman’s terms, when it comes to self-hosted platforms, the retailer is in charge of hosting their ecommerce site. Companies must either manage their own servers or locate a hosting provider that provides the necessary infrastructure for e-commerce sites. Retailers need to set up, install, and maintain the platform in contrast to SaaS platforms.
Sites that use such software as WooCommerce and Magento can host releases on their own servers.
Advantages of self-hosted platforms
- Greater control: Perhaps the greatest advantage of choosing an e-commerce platform of this type, lies in the control it gives companies over their online stores. Retailers can change every detail of the e-commerce website. They have control over design and functionality, integration of tools, or services from third parties. Businesses cannot do this in SaaS environments.
They have no choice but to accept whatever features, workflows, and even the appearance of their website templates might have been predetermined by the supplier. With self-hosted solutions such as Magento and WooCommerce, it’s possible to alter a site’s layout, user interface, and customer experience to meet your specific requirements. Ecommerce businesses with needs that others don’t have and those who want to stand out in a saturated market will love the ability to customise things at that level.
- Freedom of hosting: Businesses that are self-hosted can choose whatever kind of hosting they like. For different web hosting providers, a merchant can pick the type that suits them best based on factors such as price and performance ability, size, and security. Flexibility like this lets companies tailor the hosting solution to meet their budget and operational needs. The hosts of large websites with many visitors or higher hits (dedicated servers) and those for small sites (shared hosting) offer this kind of hosting benefit. For example, retailers of WooCommerce can use any hosting provider that supports WordPress. They consistently provide a wide range of solutions for retailers to choose from.
- Easier migration: With a self-hosted e-commerce platform, upgrading applications is much simpler compared to SaaS ones. When a company’s website data is controlled by the business itself, moving to a different platform or hosting provider is relatively easy. Retailers can export all of their data—customer information, product lists, and transaction records—and import it into a new system or platform at will, keeping things running smoothly for an online store. As business needs change, it also offers companies the freedom to move into a different, more suitable hosting environment and escape the restrictions of working on one platform only. For instance, Magento’s open-source approach allows for businesses to shift all their data across seamlessly, keeping both site structure and content intact.
In short, open-source, self-hosted e-commerce platforms give businesses ultimate control and flexibility. You can infinitely revise every detail; there will be better hosting choices, and things are easier to move around. That said, setting it up technically and then maintaining and managing security means businesses not specifically designated as tech operations hubs will have a big job on their hands. Nevertheless, for businesses requiring a high level of customisation and control, self-hosted platforms remain a powerful choice.
Headless e-commerce platforms
Headless e-commerce platforms are a sophisticated alternative for companies that want to keep up to speed with the latest retail technological developments. In traditional retail e-commerce platforms, the frontend (what customers see) and backend (where data is stored and processed) are closely integrated such that software systems above department level cannot easily be changed.
The two share a single space on disc memory, becoming closely interlinked in terms. In headless e-commerce, these two elements are independent of each other, and in it we see a severance of the previous system architecture. This new separation enables companies to deliver a more individualised experience.
Between the front and back end, there’s a layer of APIs (Application Programming Interfaces) that makes communication possible between these two systems. Businesses can make websites, mobile apps, voice assistants, and other digital touchpoints of various kinds talk directly to the backend infrastructure thanks to these APIs.
This kind of flexibility also allows businesses to build highly customised experiences for users, but they still run all their orders through one back end that serves thousands of shops and hundreds of millions of customers.
Online retailers can use Commercetools, Fabric, and others for headless e-commerce solutions that deliver completely new shopping experiences over many platforms and devices.
Advantages of headless e-commerce platforms
- Customisable shopping experiences: Headless e-commerce platforms offer unparalleled flexibility in customising the user experience. The face end is dissociated from the rear end. So, retailers are able to design the appearance of all or part of online shops for different customer segments and sales channels. Retailers can thus create an everchanging experience unique to each platform—a website, a mobile app, or a social media channel. This provides users with a seamless omnichannel journey while at the same time adjusting to their various needs. For example, a retailer can offer a streamlined mobile shopping experience while providing richer features on the desktop, all based on the same backend system.
- Omnichannel readiness: Headless platforms are designed for retailers who want to be truly on top of omnichannel retail. Thanks to technology, every customer touchpoint should thus have a consistent experience with the physical store. Given the impact of consumer behaviour turning toward mobile phones and computers, by using APIs, retailers can easily integrate various sales channels, from websites and mobile apps to social media platforms, kiosks, and in-store systems. Lastly, though, when everything is said and done, using a combination of systems and channels instead of just a single sales channel will greatly increase your chances for purchasing success. A retailer who executes an effective omnichannel strategy can retain as many as 89% of customers compared to only 33% relying on the single-channel strategy.
- High level of customisation and creative freedom: By decoupling the front and back ends, you have much freedom to create from scratch. Backend forces, like ecommerce inventory software or payment processing functionality, can be developed by developers alone while the front-end design deals only with serving up visuals to meet user demands. These are ideal platforms for retail experimentation at its best, regardless of your location. Retailers can create personal experiences that truly show their customers they are number one.
- Increased flexibility: The way in which headless platforms are constructed facilitates greater adaptability to changes in the market or technological surroundings. Retailers can insert new functions, revise interfaces, or initiate higher-level features (such as AI-fuelled recommendations or voice-activated shopping assistants) without having their main backend system disturbed. This autonomy in innovation lets retailers keep up, respond quicker to technology or retail and e-commerce trends, and meet customers’ demands more fully.
- Strategic integrations: Headless commerce platforms allow companies to seamlessly connect with third-party technologies, enabling innovative solutions that enhance customer experiences across multiple channels. Such third-party integrations include (but are not limited to) chatbots, AI-powered customer service tools, voice assistants like Amazon Alexa, and even virtual try-ons using augmented reality (AR). In this way, businesses can provide a more personalised and energetic shopping experience, better matching up with their brand image and an evolving need of customers as well.
Summing up, the huge flexibility, scalability, and customisation promised by this type of headless e-commerce platform are exactly what retail brands need. Embracing headless commerce means retailers can provide personalised, omnichannel retailing experiences that promote customer loyalty and satisfaction while at the same adapting to today’s growth and technological innovation.
Final thoughts
Choosing an e-commerce platform is a crucial decision for retailers. In today’s digital era, e-commerce continues to boom, and where one can do business has also changed dramatically.
To have a successful online business, regardless of whether you are just starting out now or plan to develop an existing online presence, it is essential to carefully assess your goals, the money at hand, and your more real day-to-day needs and choose a platform that integrates ecommerce features with your in-store technology.
As the digitalisation of the retail industry goes on, the nature of e-commerce platforms is also evolving. In this new era, you must still grow with them. In your business’s ability to scale, maintain customer engagement, and remain competitive, understanding different types of e-commerce platforms and choosing the right one are key. Make sure you prioritise technical innovation as well as customer experience in order to stay ahead of market trends.
If you’re an eCommerce retailer looking to elevate your strategy or just starting out, you can’t afford to miss eComm North. Discover the essential tools and strategies to drive your success. Register now!
