Aaron Conant 0:18

Happy Thursday everybody. My name is Aaron Conant. I'm the Co-founder and managing director at BWG Connect. And we're a networking and knowledge sharing group with 1000s of brands who do exactly that, with networking knowledge share together to stay on top of the newest trends, strategies, pain points, whatever it is that shaping the digital landscape as a whole, I get to connect with about 30 brands a week to stay on top of those trends with the same topics come up over and over again. That's how we come up for the topics for these events that we do. We're getting close to 500 virtual events like this, this year, we're close to 100 in person events. And so, you know, feel free to visit our website if you want to see any of those upcoming ones, more than happy to have you attend a couple housekeeping items as we get started. At any point in time you have any questions, we want this to be as educational and informational as possible. So at any point in time, feel free to drop questions or commentary into the chat in the question section. Or you can always email me Aaron aaron@bwgconnect.com. And we can get as many questions answered today as possible. The other thing is, we're kicking this off at three to four minutes after the hour. And just you know, we're gonna wrap this up with probably right around the same amount of time left in the hour as well want to give you plenty of time to get on to your next meeting without being late with that. And I want to kind of kick off this, this conversation and just in the pre call chit chat, we're saying a little bit that it's like this next level of commerce that we're talking about, it's we're past the checkboxes if we want to be successful if we want to lead or be leaders in our industry as a whole. And so, you know, just thought, you know, this whole topic. So whole, we got some great friends across the network come highly recommended from a ton of brands in it, just from three different great organizations that agreed to kind of jump on the call today. We did a research project together with them. And we're gonna go through some of those findings, then we're going to kind of open it up to a conversation. But just to kind of go quickly around the horn here for a brief intro, you know, Kelly, I'll kick it to you first, if you want to do a brief intro to yourself company, which you guys do, you know, and we can just make it around the horn there. And then we can jump back into some of this content, and then open up the q&a. Sound good.

Kelly Goetsch 2:25

Sounds great. Thanks for having me. I'm Kelly Goetsch. I'm Chief Product Officer of commercetool. So I look after product strategy, product management, really anything product related to commercetools. So glad to be here.

Kevin Cochrane 2:38

Kevin, you want to go? Hey, thank you so much, Kelly. I'm Kevin Cochrane, Senior Vice President of Product Marketing here at Acquia responsible for go to market strategy, and all of our go to market partnerships with commercetools, and with the digital here.

Dr. Ali Alkhafaji 2:42

I guess I'll wrap it up Ali Alkhafaji, I'm the Chief Technology Officer at TA Digital. My role is overseeing our digital transformation initiatives with customers. So I work with with software's like commercetools and Acquia glad to be here.

Aaron Conant 3:13

Yeah, awesome. So let's just a reminder, drop questions in the chat the q&a, or email them to me, Aaron Aaron@bwgconnect.com And we can we can tackle those questions. So first, we're gonna go through and we can make this available to people after the call, kind of the project that we went into as a whole to take a look at, you know, across organizations, how are they looking at this space as a whole. And so just, you know, survey 79 different organizations, 27% of respondents are presented consumer discretionary companies, two thirds rank director level or higher in seniority. So we're really going for decision makers at these companies as a whole, you know, 39% of respondents, and I'm not going to spend a ton of time on all of these, because we can make it available afterwards represented three 9% represented companies with less than 500. And then about, you know, a third or so 10,000 or more employees. So, we try to get a broad spectrum across the board. You know, interesting here, you know, when we ask, are you using an external team for your web or eCommerce needs 44% said, you know, self managed, it's, which is very interesting at this point in time. You know, just as we try to tackle it, I think people are trying to figure out, you know, who do they use, who's the right partner, and over, you know, the past year, a lot of people have been, you know, acquired, and there's a shortening of staff. If you think pre pandemic, if there's 1000 people that knew, eCommerce, now we're at 1500, but there's need for 10,000. So, I think a lot of people that 44% are still scrambling, you know, the other way is what is your current eCommerce platform? You know, we have this chunk of 8% that says they still don't have one, you know, first generation and kind of the second generation you know, Adobe commerce cloud Magento, Salesforce Sitecore. bolt on Shopify, you can see them here. You know, I'm going to kick this over just to Kevin and Kelly and Ali. First thing. Is this ring true for kind of what you guys are seeing today is this random collection of people, you know, it's almost evenly spread 3333 And then wraps up with the 5033 and eCommerce platform selection. Is that kind of what you guys are seeing as well?

Kelly Goetsch 5:30

Yeah, I think this, this really rings true. You know, there's still a lot of old software out there. And I think it's holding a lot of organizations back. So it's a, it's good to see this third generation, which we're part of represented here. And that slice is growing very rapidly. As folks decommission and and vendors cut off support for those old platforms. So overall, this is this is good. That means we're in the right market.

Aaron Conant 5:55

Yeah, so a lot of you like, if you want to dive in just that third generation, you know, as we kind of put this together, you want to put some, like, you know, guardrails around what we mean by third generation.

Kelly Goetsch 6:06

Yeah, it's, it's a composability. I think that's the key word there. So it used to be back in the 90s. And 2000s, organizations were just getting online for the very first time. And when they were getting online, they would quite literally just buy a big package of big, you know, software package from one of these big legacy vendors, they'd go to IBM, and they'd write out a big check. And they would get a functional, but very monolithic and large and packaged platform. And it was basically Shopify, but for the enterprise, right, here's a giant Website in a Box, right. And then through professional services, that would get very tightly welded back to all of the back end, back office processes, right. And I think that approach worked just fine back then, when folks were getting online, and they didn't have a lot of technical competency. But now we're getting to an era where the technology has fundamentally changed, we have things like Cloud, and Cloud has given rise to multi tenant SaaS. We've also had API's be much more widely adopted, once iPhones started to get more widely used. And that gave rise to have those commerce. And we also have a lot more customer touch points than we ever used to have. It used to be just that you had a mobile or a desktop website. And now we have mobile apps. We have mobile web, we have desktop web. We have smart devices, we have voice devices, we have all sorts of devices. So with these new composable platforms of which we are the leader in that space, you're buying and incrementally adopting pieces of a platform. So you might have WebSphere Commerce today. But you're using us for the product detail page this month, and the next month, you're using us for the category page. And you just generally chip away at that legacy platform until it's gone. And along the way, you're not necessarily using every one of our API's. Instead, you're using our API's other third party API's, and you're building API's where it makes sense to where your business is differentiated. So it's that composability part that's really unique here.

Aaron Conant 8:11

Yeah, I want to jump back to the agency side, because I'm still shocked that, you know, 44% don't have help. And I don't know how they're figuring that out in the backend. Ali know, I'll kick that over to you, what are you guys seeing in this space as a whole? It's growing so fast and so rapidly. To stay on top of it, you know, internally just seems difficult. But I'd love to hear your thoughts there.

Dr. Ali Alkhafaji 8:37

Yeah, I think some of this will map exactly to so I think those two charts are definitely related. So when you have an organization trying to map trying to manage their entire digital ecosystem, when it comes to commerce, on their own beat, can't go aggressively towards a third generation route. Because for them they need they don't have those cloud API capabilities internally, they don't have the integration capabilities. Internally, they manage a team that has been doing I mean, his example, IBM for 20 years. And that's all they know how to do. And they can do that they can have those house resources internally manage that. But once you start building towards kind of the future roadmap you need need, you need help. Very few organizations out there can can take a platform, a mindset of composability and do it all internally. I think that idea itself correlates between most of them don't have the third generation in mind and some of them don't even have that support from the outside. But I think overall, if you're not a fortune 50 organization and you don't have a massive IT team, and you're doing all on your own most likely you're focusing on using kind of the all in one box example that he gave where he basically paychecks To a large software company, and then give you a website now, what's that composed of? When you get with it? And what kind of filler technology they throw at you? All that is is irrelevant at that point. So I think those two points are correlated for sure.

Aaron Conant 10:15

Yeah. Awesome. Yeah. Kevin, from your standpoint, then, you know, I probably have another seven slides to get through here. What's, what's stopping people from jumping off from the monolithic platforms? The, the old ones? I mean, I understand you're saying it makes perfect sense. You know, it's a, they've already got built out a team, they're doing it on their own their heads down, they're just trying to make, you know, the old system, you know, keep working, right? But

Kevin Cochrane 10:43

to harken back to exactly what Kelly and Ali said, okay, so and first and second generation systems, people wound up, you know, doing tremendous amount of professional services, to wire together all of their back end systems on big 18 month, projects, sometimes that took 36 months after it failed the first time. And they essentially built a very ossified digital structure, that impeded the ability to explore and innovate in new areas. But because of the cost structure involved, because the resources, they need the mobilized to self manage it, actually ripping and replacing that became, you know, essentially a huge challenge. So as Kelly noted, with the new composable architecture, you can start, you know, bit by bit, replacing different elements of your commerce experience. With new back end API based architectures, maybe first start with one particular category page, send to another category page, then extend to some new, you know, digital AP, for example. And, as Ali stated, if you're only going to use your internal team to do that, your internal team can oftentimes be a bottleneck to change, you know, existing processes, existing skill sets existing mentality, you know, pride of ownership, you need to rely on third party like TA Digital here that can help you put in place a strategy for bit by bit introducing a new composable architecture. And slowly over time, chipping away at that ossified monolithic structure to get you into new composable future. And moreover, you know, stick with that digital agency stick with TA Digital so that you can go beyond just replacing the monolith. And you can constantly be innovating and exploring new ways to, you know, build shoppable experiences, wherever your consumer are, the innovation never stops. And so leveraging a third party agency, like TA Digital to always keep you at the forefront of digital change is very, very important. So just as Kelly and Ali said, those are the things that are holding you back, you've got to get to composable architecture, and you've got to start leveraging, you know, best in class talent from the likes of TA digital to help you get there.

Aaron Conant 12:58

Awesome. Love it. You know, just reminder if people have questions or comments drop into the chat. So interesting here, where does your eCommerce solution strategy rank among other firm wide priorities? You know, a third people saying, Hey, is strategic, a third saying high priority? You know, and then a third saying moderate to low priority? You know, I think it's interesting that there's still a third, that's just moderate to low, just given the past 18 months. But then where are you and your adoption of cloud infrastructure and applications? Not moving to the cloud? You know, just starting rapid maturing is, you know, still, I think, where people are looking at, right. You know, it's kind of at the best practice, what are we trying to do? How are we trying to figure it out? Any thoughts on this, you know, the cloud infrastructure in the majority curve here, you know, Kelly Kevin, or Ali's this, you know, pretty standard.

Kelly Goetsch 13:51

But I think there are some organizations that aren't focusing on commerce and commerce strategy. And I think it's to their detriment, but sometimes it's to their business model. If you look at some b2b organizations, for example, you know, they're selling 100 tons of steel. And they're doing it over fax machines. And yes, it's inefficient. But you know, given the relatively few number of sales they make building a big, beautiful, fancy website, but not quite make sense yet. So I understand that, although I think all of b2b is digitizing here shortly. There are also some brands that the business model just doesn't really make sense, like the dollar stores, for example, you know, they're not going to be really doing eCommerce to speak up. They're selling really cheap items locally, low margin. And then there's some folks out there like, I don't know, you know, TJ Maxx, you know, those types of stores that it's the whole experience is going there in store. It's almost like a treasure hunt is kind of what they say. You also have folks like Costco, you know, where again, it's much more of an in person experience. That'll being said, I think Those are the few exceptions out there. And I fully expect everybody to be digitizing more in the future. But that might explain why that 20% is. Is there and it's not 100% Higher strategic priority.

Dr. Ali Alkhafaji 15:13

And Kelly. Oh, sorry. Go ahead, Kevin. Oh, no, please, Ali. No, I was gonna say I would argue that even that is going away. I mean, b2b, b2b customers are not from another planet. They're their b2c Customers elsewhere, and they are getting used to and, and basically, the maddening experiences that they're seeing from every other organization that you work with, just because they're buying something different from your organization doesn't mean that expectations are getting lower. In fact, as the b2b customers are becoming more and more entrenched with technology, and their experience and the expectations of customers, even b2b oriented organizations, if they don't start thinking that that approach and that roadmap, you know, they're dinosaurs, and they need to really, you know, change their mindset, I, there are exceptions, I get it, but I think they're from the majority from that perspective. You know, b2b is definitely an area where the audience is going to dictate the experience, not the other way around.

Kevin Cochrane 16:15

Yeah, just to build on that, I couldn't agree with you both more. I think sometimes when you look at the statistics, what people think of as commerce isn't necessarily what commerce is, in the sense of, if you're looking at b2b, the wholesale transformation of you know, build service organizations, when they're actually working with their clients and a kind of a high touch client telling application, they're actually taking orders on their phone, they're actually doing commerce, right. They might not call it commerce, but all of the field course automation they're doing, where they're helping their clients, you know, build, build new parts, and so on, so forth, that is commerce. So I do wonder if, you know, some of the statistics might be skewed, because the perception of what is commerce, for different verticals and in for different use cases, they might not think of it in the classic retail sense, but what they are enabling is, you know, their employees and their consumers to conduct digital transactions, whether it's in the store, whether it's in the field, or is or maybe directly online. Also, sometimes, you know, organizations today, they're reinventing their business models, they're inventing new digital services and digital capabilities. And so, you know, whereas they might have traditionally thought of commerce, commerce as selling you this widget, you know, nowadays, it could be selling you a subscription to some new, you know, service delivery model, or some new, you know, support package, that's commerce as well. And we see just this burgeoning demand for new innovative composable commerce, infrastructure to support new business models, new digital services, and new ways of enabling shoppable experiences direct from employees in the field or direct to consumers that they happen to be natively interacting with you when they're walking past the kiosk or more.

Aaron Conant 18:07

Awesome, love it. And then I'm going to kind of buzz through these last few slides here. Just from the standpoint I have some questions that come in that I want to make sure that we get to and we get answered as a whole, you know, so around Hey, what are for step say what is you know, can you clarify composable commerce, a few different things, I want to make sure that we get answered and just others if you have questions, email them to me Aaron aaron@bwgconnect.com or drop in in the chat or the q&a. You know, 29% consider their pure organization very or somewhat unprepared for five for cloud commerce solutions. We're gonna keep kind of going through this as a whole. Just jump here. I mean, 44% response indicate, you know, to utilize a mixture of digital and physical business storefronts, I don't think anybody is shocked by this. You know, 44% of you there commerce, eCommerce strategies, integral component of their long term growth strategies. You know, these are things but I think this also, you know, brings in a couple questions around what what does that look like? We want to take a step back just on this one, because the question came in around Can you define have them defined compostable commerce? So we're on this chart here, headless versus composable? Do you want to break down you know, those two and what exactly you're meaning by headless first composable.

Kelly Goetsch 19:31

Sure, they're, they're similar and often used interchangeably, but they are distinctly different things. Headless is simply decoupling the front end from the back end, and it used to be that commerce platforms, add the front end baked into the back end. So anytime you touch the back end, you also had to rerelease your whole front end and vice versa. And that coupling really slow down really cycles because if you wanted to do a pixel change and move an image over, now all the sudden you have to redeploy everything and that will horrible. So that's that's it. And on the back end, it could be anything. What composable is is the back end itself, decoupling that back end. So composable is almost a more advanced form of headless and and composable, you have an API for a shopping cart, you have an API for a product, you have an API for inventory. And those API's may be from a single platform, a single vendor, like commercetools, that might be from different sources, you know, maybe you have an OMS, that's exposing some of that information. Maybe you have a standalone pricing engine, standalone promotions engine. So you're composing the experience on the front ends borrow from multiple API's in the backend.

Dr. Ali Alkhafaji 20:46

And one thing that I've always noticed is, there needs to be an understanding that with today's technology, almost every platform can be headless. You know, every platform uses API's. And I see this a lot with customers, where they send this questionnaire to product vendors, and they say, is this product headless? And the answer is always yes, you can, you can make anything headless. But the question is, is it supposed to be Is it meant to be has it built in a way to to abstract out some of these functionalities, and rely on other technologies to take care of these other pieces. And I think the same applies to composable. With API's most mostly driving most of these technologies, it's easy to make anything, interact with anything else, but it's not intended to be and then now you have this Frankenstein like architecture that you have to maintain that is not built the way you're supposed to be. I think that's a huge distinction. Because if you look at all the product vendors out there, they all check the headless box, pretty comfortably. But you know, the intent is you have to look at what a product is supposed to do versus what do you make do with, you know, extra customizations and efforts? Definitely, and then just add on to that, you know, it's more than just the API to be truly composable. Number one is all he said, you know, each of your services need to be completely atomic, atomic, okay, it needs to do exactly what it's supposed to do. And only that, it needs to be easily discoverable. So a developer can easily call that service and get the exact function that they need. And only that it needs to be completely autonomous. Okay, so it needs to have no dependency on any other service in order to, for it to provide its particular utility to that developer and that specific call, and it needs to be orchestrated. So at the end of the day, if you don't want to use an OMS anonymous function from, you know, vendor A, and you want to plug in vendor B, well, it doesn't matter, because it's orchestrator, so any set of services from any set of vendors, they can all be stitched together, orchestrated, and still function because they're autonomous, they're easily discoverable, and they're atomic. And if you're just purely headless, sure, you have API's, but that doesn't mean every business capability, it meets those four criteria.

Aaron Conant 23:14

I'm looking at it. No, it's awesome. It's yeah, you're right. It's funny, because composable. So I talked to 30 brands a week, you know, and headless started really popping up a lot last year, composable is just starting to come up in a lot of conversations now. And I love kind of how you're saying it's like, the next generation of headless, although it's, it's different. But then again, you know, I look at this chart here, like 45%, say, hey, the challenges with implementation. Now, in your experience, you know, are those actual challenges, or those just we don't understand, and therefore, their challenges, right? Is it really that hard to do? Or is it just, you know, this is so new? You know, they probably don't have experts on their team to do it. And so the next level is, you know, what's, what's your advice for people who are at this like inflection point, right now, they realize where they're at, they realize they need to change and go someplace out. So they may have been considering headless, you know, maybe they should be considering composable now, like, how do you kind of like, you know, advise people that are in that inflection point in their business right now, maybe digitally mature, maybe digitally mature and just need they know, they need to go, you know, to the next level?

Dr. Ali Alkhafaji 24:33

Yeah, we talked about this a little bit earlier, around, relying on experts that understand this type of deployment model. But I think the more telling point, they know that you're ready for this type of deployment. It's the mindset. And this is this is what I've seen is the easiest way to measure whether the organization is ready for this or, you know, sometimes that doesn't factor in if they're going to succeed in this right that's why we consider it hard, is because they take composable platforms and composable architecture. And then they try to do the same way that they've done it for the last 20 years with non composable products, because they have the same mindset, they approach things the same way, this is the way we've always done it. And this is how we're going to do it. And if you're trying to do this, basically ignoring the word transformation and the phrase digital transformation, you're not gonna succeed, or at least it's not gonna come easy, it's going to be difficult, it's going to be costly, it's gonna take too long, you need to approach these types of projects, with that mindset, that this is how these projects are supposed to be initiated, this is how this was delivered. And if you stuck with the mindset of the past, you're always going to have difficulty with this type of project. So I think that the majority of this 45%, I would wonder how many of them approach these projects like they would have, you know, an over an old model, or legacy platform, because that's what they're used to.

Kelly Goetsch 25:59

Yeah, they're just not used to this, that's what it comes down to. They've been doing the same Hybris for the past 15 years, or WebSphere, Commerce for 20, or whatever it is, and people get set in their ways. And this is a very different approach, you know, this whole new style of architecture, and it's very widely adopted. But, you know, if you're, if you're working for a retailer in, you know, a small corner of the US, you might not have seen this at scale at all. And the whole notion of blowing up your platform and gradually migrating over to something new over the course of six months or a year is a very daunting task. Right?

Kevin Cochrane 26:35

That's a little bit. A real quick just add a little bit to that, because there was this wonderful book, I read by a wonderful author named Kelly Goetsch, who outlined some of the organizational challenges and cultural challenges that you have to accrue the benefits of composability. And some of that is your teams are structured differently, your processes are no different. You have to move to smaller economist teams. And those smaller autonomous teams have full responsibility for delivery of just their digital service. Those small autonomous teams should have the ability to independently move forward on their own release schedules, and be fully responsible and accountable for the success or the failure of their release. And that's not the way people are organizationally set up yet today. They have larger teams distributed responsibility, much more waterfall type processes, no matter how we tried to move to more agile methodologies. This actually forces true Agile processes, and it changes organizational structures and it changes processes. And that's a big, huge cultural shift, even if you can make the mindset shift. And again, I just harken back if anyone wants to learn more, again, wonderful book, O'Reilly book delegates, you can look it up online. composable commerce.

Aaron Conant 27:49

Yeah, I mean, what does that initiation look like? They do, they just, you know, they bring, you know, bring Kelly in Ali, if they bring you in to say, you don't have to sit down with the team to say, Hey, by the way, this is what it looks like. Because I think you're rightly, you know, telling you that they just don't know, right? And Digital's happening so fast right now is just enough, you know, to stay, you know, to keep the boat afloat right now, as opposed to, you know, coming up for air and having a broader view, they almost need like experts to come in and say hey, by the way, here's the other option. And yeah, there's a curve time curve to get there. But here's the benefits on the back end.

Kelly Goetsch 28:27

Like what I mean, we bring in a good partner like Ali, you know, because that's where what we're offering. I mean, candidly, what we have are really nice API's but there's a big difference between here's some API's and here's a strategy and then to execute on that strategy. That's not what we do. That's where we need good partners.

Aaron Conant 28:49

Awesome. Yep. Love it. I think we can keep going through this is a best of breed breed versus all in one it seems pretty straightforward and what we should be going for here you know, you know, I kind of I'll open this back up you know, you know Ali kick it over to you first your thoughts and best of breed versus all in one.

Dr. Ali Alkhafaji 29:16

This is I've always I've never understood why organizations buy things in all in one you know, this to me, it's always been you know, bulk buying in bulk makes sense when you're buying toilet paper and breakfast cereals, really terrible idea of technology. Because when you find an all in one product and regardless of which vendor it is, but you buy own product, naturally, they didn't make a lot of filler things in there. They're just horrible. They're just not very good. And it's in there to make it an all in one. It's like no one can sell you a car without a steering wheel. So they put sooner than later on but even even though the steering wheel is not very good, you're stuck with it. And you can't really replace it and your you know your your options are either too. Live with it, an inferior product or you you make changes you bring in a better signal we are accustomed to, but now you have irresponsible, we break the warranty of the car and responsible for maintaining it for years. And to me, that's just never been a very smart approach. Even when you're going with some of the legacy products, some of the legacy monoliths, customers, often they end up really customizing it much, much more than the than the product is intended to do, because they want to get better functionality. And to me, the biggest drawback of an all in one platform is you're not going to use 90% of the product. And I think that's one thing that you know, most customers are really beginning to realize is, when you buy an all in one, you're basically using like 10% of that, then you're carrying on and the other 90% First of all, you're paying for it. And second of all, you have to maintain it, it's your responsibility. No, it's that technical that you have to carry on and upgrade and patch and do all these things that come along with it. When you when you invest in composability, you might spend a little bit more effort to get that 10% built up because they call exponents API's. But guess what, you're only doing that 10% Because no one uses API's to build the other 90% that they don't use, because they only focus on what they use. So you know, my take is on all in one versus best of breed. This is pretty straightforward. You build it by what you need. And you build what you need versus you know, just this box that gets a sign up in the morning.

Kevin Cochrane 31:34

That's right. And Ali I think I'll just build on that point. You know, we live in a world defined by power laws, right? And we have another Pareto here, with enterprise software, which is 80% of the value is delivered by 20% of the capability ie flip that 80% of the functionality doesn't actually get used. And we all know that. And those are, those functionalities don't get used simply because they are tack on features that are under resourced, and they're not innovative, right. And composability just blows that all up, which is the 20% of capabilities that actually deliver 80% of the value, great for that vendor use those 20% of capabilities, because they're all atomic, discoverable. autonomist are tradable services, right, they're composable, and then actually brought the additional value that you need, just get it those 20% of services, additional services from another vendor. And that's how you really truly unlock a better optimal stack when you get away from the monolith and break the power law. Yeah, well said.

Aaron Conant 32:41

Yeah, I mean I think it's so getting back to a Why would people do it? Originally, it was a checkbox, right? Like, we got to have these 15 things. Does it all included? Yes. All right, then it's an easy decision, and we move forward. It's just not applicable. You know, for where we're at, in digital today, we're ready to invest.

Dr. Ali Alkhafaji 33:01

Exactly. I love gardeners of this world, I love the force of this world. But again, everyone needs to check the box. And 80% of the time you check the box, you might not be the best of breed in each one of those boxes. Right? It's also brand recognition. Right, Kevin? I mean, the what was the saying, you know, you never get fired for buying IBM. I mean, yeah, but you live with the promoted either, because you're still where everything else is doing, you might protect your job for the time being, but you're not advancing what you're what you're hired to do. So broader mission plays a lot into it. And I think that that also is, is a crutch that customers have to get away from is just buying what they recognize. And to me, that's a big 100%.

Kelly Goetsch 33:45

But we have to go back in time. I mean, think in the 90s, there was no such thing as a REST API, like that literally didn't exist. There was no such thing as a best of breed SaaS vendor took a ton of capital to get software vendors off the ground. And at the same time, organizations didn't have the technical maturity to do anything with this stuff. So even if you did buy different pieces, you could integrate it very well. So it made perfect sense back then. But it doesn't anymore.

Kevin Cochrane 34:10

It's interesting, you bring that up, Kelly, because it really it really does say, hey, as we advanced technology, and as we're now realizing the promise of a composable stack, after 20 years of innovation and API's and architectures and so on so forth. Are there still some things that haven't kept pace with that development in terms of the buying criteria, our buying mindset, how we rate the analysts, firms, different vendors, you know, some of that stuff still might be, you know, thought processes are still rooted in, you know, what was state of the art back in the 1990s. It's a, it's a brilliant observation. I hadn't thought of it that way. But it's now got me thinking about what else needs to change in terms of a mindset, not just within an organization. That's simple. Proposal WooCommerce but as vendors and as a, as an IT community more holistically.

Aaron Conant 35:06

Yeah, yeah. So thing, you know, the financing side of it, you know, as well, where's the budget coming from? Right, it was almost an r&d budget for a lot of companies for a long time. And now it's required budget that's in there. And they're, they're looking into. And then, on the flip side, you know, a lot of people in the digital space, you know, they have a different level of accountability now for the money they're being given than they did three years ago. And when you leverage them that aren't to continually perform and get the best ones out there, like, they're now more actively pursuing, like, hey, I need to have something different, right? That you have the leaders in the space saying, I can't go with this all in one solution, I can't go with this monolithic, you know, solution that's out there. And they're now being allowed to go out. And I think it's really the last, you know, year and a half, this really opened up freedom for a lot of people to go explore it and see all the benefits. I mean, some of them are highlighted here. But so many that comes up is like, then, what do you have? As far as KPIs vary, so many jumps down this path? You know, what should people be looking at? As far as KPIs? Right? How do you make the business case for this? You know, if they're gonna make it, those are things that come up a lot as well. Right? Because you're not gonna get fired for going with IBM, right? From that standpoint, well, how do you make the business case that we have to make this change? And then what are the KPIs you throw out there that you can, you can follow and then prove as you go along, that you're hitting those and that it was worth it?

Kelly Goetsch 36:39

I actually disagree quite a bit with these findings here, I have to say, the number one value I see is improved time to market. Right. And what I mean by that is, most of the folks that we're working with a commercetools are releasing to production once every other week, or once a month. And I'm a firm believer that innovation requires iteration, you've got to iterate on the feature feature multiple times for it to start generating revenue, and to perfect it. And if you're on a monthly release cycle, it might take you six months to get a feature in production generating revenue. And Amazon, I don't know what the number is today, but in 2015 amazon.com, was being released to production once a second in perspective, to put that in perspective, and our customers that are having the most success are saying, yes, cost is fine. You know, all that stuff is fine. It ticks the box there. But the real value we're getting is we can go from prototype to production in a day, we can collect feedback, the next day, we can perfect that. And we can get something live in production. So trying trying new things, experimenting, a B testing these new features, allowing teams to release very quickly without retesting the whole application saves a lot of time and money. But it's really that release to production is what what's important.

Aaron Conant 38:01

Yeah, I mean, okay, this to Ali, per you how you help customers, like prep for that rapid iteration, right? I mean, it's testing and learning over and over again, right? It's, it's literally the scientific process and doing it faster than anybody else. But you have to have the tools to be able to do that and iterate over and over again, but then you also have to design it all. Are you guys coming along? Like organizations and helping them do that? Like, how do you approach that rapid iteration piece?

Dr. Ali Alkhafaji 38:29

I think in the beginning, when when somebody is undergoing a brand new composable architecture deployment, the biggest concern we always face is that initial heavy lift, you know, building your architecture, deployment model, integration points API layer. But even that, in itself can be iterative, even that in itself, you know, you can focus on a specific service, a specific functionality and build on top of that. One out, when I talk to customers, what I always tried to recommend is don't look at this as an end state. It's really just a continuous evolution, but you have to continue to build on top. But what that does, it really changes the way you have to look at ROI. When it comes to composable commerce, ROI is not, you know, immediate ROI is a long term conversation when it comes to composable architecture, because the benefits that you know, we are the things that you know, Kelly talked about, you know, the long term savings when it comes to things like maintenance, upgrades, iterations, experimenting, future integrations, additional channels, replacing older products, being able to do these things, you know, in terms of time to market in terms of cost and timeline to get these things done in a composable architecture versus doing it in a model if I mean, it's an order of magnitude better, faster, cheaper than it is with a model. And I think that's where the ROI really lies. But unfortunately, when you look at some of these organizations, they don't build the ROI model to look at these things they look at okay, how much does it cost? to build up, and how much does the license costs, and then compare those two numbers versus this other product. And you can only do that because if that's the case, and everybody just goes and buys Shopify, like if that's really your model, and then, you know, go pay your $5,000 a month, or whatever it is, and then you're done. I think you have to look at it in terms of a long term conversation, because, you know, what COVID has taught us is commerce is the future, and this is your business model, whether you like it or not, especially if you if you're in that line of work.

Aaron Conant 40:35

Awesome. Love it. I think we have just a, you know, one last slide here. And we can share this with everybody as well. You know, respondents consider improved functionality and customization to be the key benefits of deploying composable stacks. Yeah, Kelly. I loved your your comment on that. Right is, it's beyond that it's speed, right at which you can do it. You know, posable tooling frees up organization selects the most reliable, competent solutions on the market. Yeah. This, what CMS is your digital storefront currently on, you know, if at 3% is part of a commerce solution, you know, headless CMS, I think, is I take a step back and just look at the conversation that I'm having as a whole. Like, what are the key inhibitors that people that you're you're finding that people have in their mind that that aren't really there? Right? Is it the fact that it takes a long time to implement it, and it's not really a long time, like are there like, like common barriers people have that are almost like myths that you run into, you know, love to hear what any of those are, is just a few people are asking like, hey, what inhibits companies the most from doing this,

Kelly Goetsch 41:55

the number one thing I see, and this is a common corporate problem is people are incentivized to do the same thing they did last year, but a little bit better. Right, they get their bonus, and it's a lot easier for them to kick the can down the road to the next person to their successor someday. And if they can show a, you know, 2% revenue increase, or, you know, some some gains, some incremental gains with their current platform, humans are primed to not disrupt the status quo, and a new commerce platform. And let's face it, that's a big deal. For most organizations, you're replacing the central way that you collect money, and engage with your customers, that's a really big deal to swap out a commerce platform. And, you know, the the other side of this is, if you're the person to take on this project, and you screw it up, you get fired for it, that that happens, right? I'm not going to sugarcoat it, that happens. And so people are incentivized to keep delaying pain. And as long as the platform is supported, in many cases, they'll just keep kicking it down the road. So that's what I see.

Kevin Cochrane 43:07

Right? And I want to build on that, because I think, Kelly, I think you hit the nail right on the head, you know, you look at some of the benefits that people are achieving with composable commerce. And it's notable that they don't cite to be they don't cite time to market, and why is that they're still evaluating the success based on the old metrics of the past reliability, you know, maintainability, so on and so forth. The reason is, is because they didn't actually fully embrace composability, which means you have to change organizational structure, you need to move to smaller teams, they need to be able to move more autonomously, they need to release to market much quicker, not on a six month cycle, not even on a one month cycle, why can't they release daily to production, that they're in charge and accountable for the results. And, you know, to truly adopt composable mindset, you need to have a CEO mandate. And that CEO mandate needs to give someone who is a bit of a rogue actor that can basically say, No, we need a new mindset, we need a new organizational structure, we need to do processes, and we're going to innovate, we're going to innovate faster, and we're going to win because we actually do move faster. We don't have to get it right the first time. But because we move faster and iterate faster than anyone else, we eventually get to perfection, right? So it's the old you know, fast fish versus big fish metaphor, you know, that faster fish always at the end of the day, wins out. So, you know, it's a it's a wonderful point, Kelly. I mean, I think there's there's much more to adopting composability than just the technology selection. There's a there's a transformation process and again, I'll kick it over to you Ali I think this is where TA Digital comes into significant play as a strategic advisor to help you know work directly CEO on down to start driving that kind of organization. little change and helping getting you there faster. So okay, Ali, I'll kick it over to you, if anything I might have misspoke to.

Dr. Ali Alkhafaji 45:06

No, no, I think you're spot on. And, you know, I think the biggest thing I've seen from an agency perspective on those customers is their concern with having to hire six different agencies way. Because when you go with a composable architecture, then you have a composable commerce platform, you have a composable, CMS, you have composable, search or mess, you know, my personalization, and you have all these different products. And then, you know, the first question that they asked is, do I have to go and hire six different agencies, because clearly, there's no one agency that knows all these products inside and out with that experience. But the message is, you don't you know, you need someone that understands composable architecture understands API's cloud architecture. And then you also need someone that understands the domain, you don't bring in someone that hasn't really done this type of domain before. But as long as they understand that domain, that's the beauty of composable architecture, you don't need a team, an agency that has 20 years of IBM experience, that's the only way they can do the job. That's all they're needed. You need some of the understands that methodology, the approach the process, and everything else is just kind of fits into place. And that's the beauty of it. That's why you go with composable architecture. So I've always heard that as be concerned with customers, I, why do I have to hire 16 different, you know, agencies and vendors, I have to manage them all? Well, you don't you just go with what makes sense. And you go with an organization that understands what he tried to do. And I think everything will just fall into place.

Kelly Goetsch 46:34

There's another very human issue that inhibits the adoption of composable commerce, which is people in very senior levels of management at a company don't know enough about digital commerce, to be able to hire people to properly run digital commerce. It would be like if I had to go hire a CFO for Congress tools. I'm not a finance person, I don't understand finance. So it'd be really hard for me to form the job description, recruit people, and then figure out who who to hire. And then once we I would hire that person, how to find out if they're doing a good job. And honestly, you know, obviously, if the bills are getting paid and everything, you know, that's a good start. But what separates a top tier CFO from a bad CFO? I don't know, that's not me. And what you find is a lot of the folks running these large retailers and brands is they are finance MBAs, right? They're money people. That's what they're good at. And they're not technology people. And I think the smart organizations out there, you know, Walmart and Target and others have put digitally intelligent people in very senior CEO level leadership positions, they're then able to go and hire a good CTO, a good CIO, good CTO. But when you have somebody who doesn't have that understanding, and going out and hiring people who are tasked with doing this, then you end up with a very serious misalignment, and you end up with me hiring a CFO, which would be a terrible idea, it'd be very bad at it. And you end up with that in retail organizations all the time.

Dr. Ali Alkhafaji 48:00

And I think to that point, Kelly, if they hire someone that's done Oracle for 25 years, guess what they're gonna buy? You know, I think that that also has to play into it is the the people who are in charge of this, are they comfortable to go outside that comfort level comfort zone, and look at things that they haven't done before, because once you cross a threshold of I don't have to do everything I've done the same way in the past, then you can start talking about what you can do. But as long as you behind that fence of I only do what I'm used to, then newer technologies, new initiatives and new advantages are beyond your reach.

Aaron Conant 48:38

How do you feel how do you find people bridging that, that gap, though, because digital talent out there? There's a shortage of it, there's a short supply of it, is everybody you know, look towards it. And, you know, like I said, there's 1000 people, maybe 1500 That really knew it. And now we need 10,000. But there's only, you know, 1500 to 2000 that are out there. And so everybody's fighting for digital talent, it's hard to get that person, especially at executive level. How do you see companies bridging that gap? Right, they need digital advice, but it's hard to find the right person to get in there.

Kelly Goetsch 49:16

It's not necessarily that it's hard to find it's that they're not willing to pay the someone exorbitant salaries required to get these people and successful retailers go out and hire people. And yes, it cost them a lot of money. Right? And a lot of that's through stock options and things but you'd have to go out and pay for the talent. And I still remember my very first job. I won't name the retailer. But they made an offer to a consultant. And they wanted him to join full time he was making $250,000 as a consultant. They offered him $70,000 And he walked out of the CIOs office laughing and I asked him later what happened and he said, I'm not going to move to the small town and make $70,000 When I'm used to making 250 And they're looking at it from a retail standpoint, you know, they don't even pay their CFO $250,000. You know, these are some retailer in a small town. So to go out and hire a bunch of executives, and then developers who are making, you know, good solid money, that's against the DNA of most retailers. And furthermore, many of these retailers are very much in cost cutting mode, they're owned by Pe. And they're cutting, they're cutting costs, they're not trying to grow the top line, they're figuring out how much money they can possibly save. And when you have, you know, some senior execs coming in at a couple 100,000 a year, and then they're hiring developers for 150 to $100,000 a year. That is very much against what the traditional, you know, MBA type, who runs retail organizations focused on counting pennies is is willing to pay for. So I don't think it's a talent. I mean, certainly there's a lack of talent. But it's more just the fact that they're not willing to pay the premium to get that talent.

Aaron Conant 50:59

Well, then it goes back to like you were saying earlier, like, you know, as we had discussion around the CEO, he did test to come out, like, Hey, this is where we're going. And, you know, I'm willing to fund it, and I'm willing to take a risk on it. And this is just where we're going. So let's go do it for the betterment of the company. I see we're really close to,

Kevin Cochrane 51:15

it's about a growth mindset. And that's why that transformation culturally, organizationally, composability has to come from the CEO down because it's a three year mission to go through the process. You know, retooling re enabling, and getting the full leverage of composability, you can slapping composable commerce, especially with digital and get value in 90 days or less. And the day, that's where you get started. But you know, you have to chip away at the monolith over time. And in order to have that growth mindset implement that program, you're going to need to invest. And that includes, at the very beginning, investing in the top talent that can take that forward.

Aaron Conant 51:57

Awesome. Love it. I see we're pretty much at time here. I do want to go around the horn for key takeaways. But also quick, thank you to everybody who joined everybody who's sending questions. Thanks so much. encourage anybody on the line today, you have more questions on this, more than happy to connect you with Ali Kelly or Kevin, a great friends, partner support is the network across the board 100% worth of follow up conversation. This is where digital is going in their leaders in this space. You know, Kevin, I'll kick it over to you first, you know, 30 seconds, two key takeaways that we jumped to Ali then we jump to Kelly, and we'll kind of wrap it up here. Sound good

Kevin Cochrane 52:28

yeah, key takeaways from my end is where at the dawn of the third generation of new composable commerce solutions, we still have a lot of education that we need to do in order for people to fully understand what a composable platform is, and what are the true benefits that you need to unlock by moving to a composable architecture. And we also need to do a better job at helping to train people how to think differently, adopt a growth mindset and employ the right resources and invest in those resources. And give them the mandate to drive the change they need to drive so we don't get stuck. And you know, fail processes, you know, failed monolithic approaches of the past. I'll evoke edu key takeaways here. Yeah, no. Sure.

Dr. Ali Alkhafaji 53:20

The one key takeaway I think everybody should adhere to is every product, every product has pros and cons. Every product has benefits and use cases where it's optimal and use cases where it's not. I think customers really need to start to try trying to fit the business problem to a product, and just do it the other way around, you know, try and fit, you know, the product, try and buy a product that solves your problem. And I think just approaching things in that fashion would really improve your life tremendously. I mean, I can I can easily vouch for that. So that would be my my advice. Awesome. Kelly.

Kelly Goetsch 54:03

I think this is largely a human problem. This is not a technology problem. The technology's there, it's very solid, it's well proven. I don't think that's the issue. I think the issue is within your organization, building the support you need, getting the management in place, aligning incentives, starting slow and demonstrating some wins to build the confidence your organization. This is a management and people problem. It's not a technology problem.

Aaron Conant 54:27

Awesome. Well, thanks so much to all of you for, you know, allowing us to pick your brain today. Thanks for sharing. Just incredibly insightful stuff and cutting-edge. And so again, I encourage anybody you have follow up questions on this more than happy to put you in touch with all the members in the panel today. Without we're going to wrap it up. Hope everybody has a fantastic Thursday. Have a great rest of the week. Everybody take care, stay safe and look forward to having you on a future event. Once again. Thanks, everybody. Take care now. We'll be in touch.