Modular commerce explained

The global ecommerce rollercoaster isn’t slowing down. Projections suggest that the market will reach a value of around $8 trillion dollars by 2028, with almost 50% of internet users shopping online by 2029. If your ecommerce business isn’t able to grow with the sector, sooner or later you’ll be missing out. 

But growth is difficult, especially if you’re in charge of an ecommerce website. The more customers you have to serve, the more online content you’ll have to manage, which means more pages, more technical detail, and typically more problems. Innovation could also change the game at a moment’s notice: generative AI (GenAI) tools, for example, are set to dramatically increase the complexity and volume of content that businesses deal with on a daily basis. 

An all-in-one ecommerce platform that worked when you went live isn’t going to be optimal years down the line. It’s likely slower and less flexible than it needs to be, and is going to start creating problems for your business and your customers if you don’t adjust. 

The answer to that challenge may involve rethinking your site’s architecture, embracing the possibilities of composability, and taking a modular approach to commerce.

So, what does modular commerce mean? In this post, we’re going to explain modular commerce as it relates to system architecture, explore its benefits, and help you understand how to implement it. 

What is modular commerce?

Modular commerce is a type of headless tech solution which allows ecommerce businesses to build exactly the online service they want to provide from a collection of third-party components that operate independently of each other. Like building blocks, the modularity of those individual components means that the business can add, remove, or combine them as their needs change. 

To understand modular commerce, and its ecommerce applications, let’s take a closer look at the different types of software architecture: monolithic, headless, and composable. 

Monolithic systems

Traditional monolithic ecommerce websites are characterized by tightly coupled back and front ends — and are typically inflexible and lack customizability. For example, when a product listing needs to be updated in a monolithic platform, that change must be made in the back end, by someone with the technical ability to do so, and the update may then take time to filter through to the customer-facing product pages. 

We could frame software architecture through a foodie-lens. Using a monolithic solution is — more or less — like going to a restaurant for dinner: you’re restricted to the set meals on the menu, can’t really change what goes into them (okay, you could hold the onions), you’ll pay in the same way for each meal, and you’ll always eat in the same environment and ambience. The advantage of going out, especially if you like the establishment, is that you know what kind of experience you’ll get, even if there’s not a lot of scope to change it.  

Headless systems

Headless software represents the next step for ecommerce architecture because it uncouples the customer-facing front end of a commerce platform from its backend technical functions. Data is transferred between the back and front end via an application programming interface (API), which means that both can be customized independently of the other without breaking the website.

Going back to our dinner date, headless commerce solutions are on par with ordering your food through an app like Deliveroo. You’re still restricted to the items on the restaurant’s menu but you’re freed from the restaurant setting because you’re at home. You can use your own cutlery, sit on the sofa, listen to music, watch a show — there’s plenty of scope to customize the experience of the food you’ve ordered. 

Composable systems

Composable software solutions go beyond the initial decoupling of headless, taking customizability to the next level by allowing you to source the components of your tech stack from multiple providers, and implement them independently across the front end and the back end. Composability sets itself apart from headless by stitching together content from multiple sources in order to create seamless customer experiences, while APIs handle communication between modules — essentially forming an ecosystem of microservices. 

Back to our dinner, composable commerce is like cooking at home — where you have complete control over every aspect of the meal. You can choose what you’re cooking, what ingredients you use, and how you cook them in order to perfect the taste. You’ll also control how you present the meal when it’s ready. Preparing a meal from scratch might not always be possible but if you want as much customizability, flexibility, and control as possible, it makes sense to go composable.  

Where does modular commerce fit?

The terms monolithic, headless, and composable effectively sit on a spectrum of increasing service flexibility or, as Contentful partner Kibo Commerce puts it, “a progression or evolution.” Since both headless and composable systems allow for components to be swapped in and out (to some degree), they may also be described as having modular architecture.

With that in mind, “modular commerce” fits at a point on the scale between headless and composable. In fact, the terms modular and composable commerce (and modular and composable architecture) are sometimes used interchangeably.

However, modular commerce is as much an approach to ecommerce as it is a characterization of the software architecture behind a website. Leveraging microservices, API-first, cloud, and headless (MACH) capabilities, modular systems help businesses create the technical space and opportunity they need to build and deliver optimized, but flexible, experiences over the long term.  

Deity, another Contentful partner, emphasizes the significance of MACH in the evolution of modular solutions, referencing the focus of modular commerce on “building a commerce stack from a set of stand-alone ecommerce services, rather than using a prepackaged platform, giving the flexibility to any online merchant to fully customize their web shop.” 

Of course, businesses seeking to operate a modular commerce platform don’t need to assemble their tech stack component by component. They could shortcut the development process by opting to start with sections of pre-assembled, pre-integrated modules (with established functionality), and then add new modules, on a need-basis, in order to customize.

Key ecommerce modules 

Every modular commerce tech stack differs in terms of specific functionalities but almost all feature certain key modules, which include:

Content management 

A content management system (CMS) is how you manage the content on your platform. An effective CMS should enable you to create, modify, delete, and publish content across your website and online store, and across the channels that you maintain (desktop, mobile, tablet, and so on). By leveraging APIs to manage the transfer of data between modules, a headless or composable CMS — like, say, Contentful — offers a way to fold content flexibility into the functional flexibility of your system. Your CMS can also ensure your content makes an impact: Ninetailed by Contentful, for example, provides AI-powered personalization capabilities that help optimize content for specific audiences.      

Shopping cart

A shopping cart module allows customers to choose and collect desired items for purchase before moving through to the payment process. The module should include a database which holds relevant product information for checkout (such as price), and should track session history so that users can retain items in their cart if they need to pause or abandon the purchase process.  

Checkout

The checkout module should handle the end-to-end payment process for goods and services bought via the online store. The module should be able to pass payment information to a third-party payment processor securely and efficiently, and maintain that functionality across all sales channels. 

Order tracking

An order tracking module should track the delivery of the goods or services that a customer purchases. The module may offer updates on the status of an order, including whether it has been picked up by the delivery company, its estimated delivery date or time, and even a visual representation of its location on a map. Some modules may facilitate messaging between buyers and sellers. 

Product information

A product information management (PIM) module contains data for the individual products sold on an online store, including product names, technical specifications, imagery, and more. The PIM may also contain taxonomic information so that customers can navigate between groups of products in similar categories. 

Choosing your modular tech stack

By its nature, a modular approach to ecommerce means you’ll have a choice of different modules that could do the job you need them to within your tech stack. Contentful (of course), has got your content management needs covered, while you might choose apps like Shopify, BigCommerce, or the commercetools App to handle shopping cart, payment tracking, and PIM duties, along with other critical functionalities. 

On the other hand, you might be looking for a more specific ecommerce service, or need an app that works particularly well with other components of your stack. You can browse ecommerce (and other) integrations and plugins on the Contentful Marketplace. 

Why choose modular commerce?

The inherent flexibility that modular commerce offers can be a significant ecommerce advantage, not least for managing both expected and unexpected business disruptions. The COVID pandemic, for example, created a surge of new online customers, who flocked to vendors seeking to access services across multiple channels. In that climate, businesses had to pivot quickly to modular solutions, adjusting their tech infrastructure to ensure that content and functionality could be delivered securely and efficiently. 

But the possibilities of modular commerce go beyond simply facilitating growth goals. Consider the following benefits:    

Cost effectiveness

Unlike the monolithic approach, modular commerce does not require a huge lump-sum investment at start-up — instead, businesses can invest only in the tech infrastructure they need. Similarly, the interoperability of separate modules enables businesses to build a combination of time- and cost-saving components into their stacks as developers make them available, or as they are needed. 

User experiences

Ecommerce markets are crowded and competitive, and success usually depends on how much a service appeals to the customers that use it. Modular commerce gives you the power to craft not only a smooth, secure customer experience but one that appeals on an individual level with features like personalized recommendations, discounts, loyalty perks, and more. 

Speed to market

Modular commerce speeds up the launch process for websites, and for new features and services. With a modular solution, a business might launch its website using a pre-assembled modular tech stack in order to shortcut initial development requirements, but, at the same time, be developing new modules for future customization.

Analytics

Information is critical in ecommerce, where the smallest efficiency or inefficiency can impact the bottom line. Fortunately, modular commerce creates a vibrant information ecosystem: every module in the stack can feed valuable data back to companies, enabling departments to track multiple performance metrics, such as click-through rates, demographics, time-to-checkout, and more. More data means more insight into customer behavior, and stronger decision-making.

A/B testing

Modular commerce architecture allows editorial teams to create and test different versions of site pages or functionalities without having to pause or disrupt live service across the wider ecommerce system. This means that your technical teams can, for example, launch multiple sales processes, homepages, and other content experiences at the same time in order to gauge how each performs comparatively, and then plug the versions that work best into the live site.  

Uptime

Growth can impact operational continuity, especially if you’re changing extensive parts of your tech stack or need to serve unusually high volumes of customers — during a holiday sale, for example. Modular commerce helps you avoid periods of downtime, and the loss of sales that goes along with it. On that note, the Contentful platform delivered 99.99% uptime during Black Friday 2023, while maintaining content delivery API response times.

Security

Tightly coupled monolithic commerce solutions present a large attack surface — if a hacker penetrates at a single point, it’s likely they’ll be able to compromise the entire system. By definition, modular commerce reduces the size of that target: each module maintains its own built-in security so if a vulnerability emerges, multiple additional security layers continue to protect the system. 

GenAI

As GenAI changes the shape of the ecommerce landscape, businesses face pressure to integrate the latest tools just to keep pace with competitors. Modular commerce allows you to plug in to that emerging innovation with less risk, train LLMs to optimize your services, and make it easier to structure content and user experiences as you scale.  

Multiregional

Modular commerce enables a centralized approach to ecommerce tech deployment but, at the same time, enables regional and brand-specific applications. This means that a company with a multi-country footprint can roll out specific technologies or workflows in one country, without paying for it across all others, and without worrying about countries that might want to use a different platform, or go in a different direction. 

Future proofing

Leveraging the interoperability of APIs, modular commerce helps you adapt to both the challenges and the opportunities of the ecommerce landscape — whether you see them coming or not. Scale easily with your growing business, keep pace with competitors by integrating emerging innovations, and swap out modules that are falling short of expectations. The modular approach means you’re always in the best position to manage the challenges of the future. 

Building your modular future

A modular approach to ecommerce typically delivers resilience, flexibility, and scalability over the long term but its impact relies heavily on the platform you choose to build on, and how it manages the technical demands of your business.    

Contentful facilitates modular ecommerce solutions via an API-first composable content management model. The platform unlocks ongoing value by making it possible to use and re-use content seamlessly across the different modules of your solution, and react quickly to the changing demands of the market. You can start small by investing only in the services and functionalities you need, and then build your platform progressively across cloud-based infrastructure, tailoring backend technical details and frontend experiences, and preparing your business for both the challenges and possibilities of the future.

In short, the Contentful® Composable Content Platform helps you take on the ecommerce landscape without fear, safe in the knowledge that you have complete control over the customer experience, and over the components that power your website.

Many Contentful agency partners offer pre-integrated modules designed to help businesses kickstart their modular commerce journey. Get in touch with us to take your first steps. 

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