An Amazon Webstore Guide

When to Migrate to aNew eCommerce

Platform

© 2014 Amazon.com, Inc. or its Affiliates

webstore.amazon.com2© 2014 Amazon.com, Inc. or its Affiliates

Online businesses are similar to traditional brick-and-mortar businesses in many ways. They must offer quality products at good prices, know their market, and provide excellent customer care. In addition, both must be equipped for growth. For online businesses, many of these factors depend largely on their eCommerce platform. When technology no longer fits business needs, companies should start evaluating whether it’s time to switch to a new eCommerce platform.

Although there are a variety of reasons why businesses choose to migrate, the most common include remaining competitive and adapting the latest eCommerce

technologies. A recent study shows that over 20 percent of online businesses planned to switch eCommerce platforms in 2013. An additional 10 percent already had a migration underway.1

As a general guideline, some experts believe a platform upgrade or switch should take place every four to five years.2 Regardless of this guideline, when an eCommerce platform lacks scalability, agility, and usability, or costs too much, it may be time to consider moving to an eCommerce platform that better fits the needs of the business.

webstore.amazon.com3© 2014 Amazon.com, Inc. or its Affiliates

LACK OF SCALABILITY

When an eCommerce business starts to grow, its platform must be able to scale to handle increases in traffic, inventory, and fulfillment.

The inability to handle unexpected traffic can create a poor user experience with slow load times and error pages; such problems can translate to lost sales. In these situations, deploying IT fixes can take time and result in costly new hardware. Furthermore, the hassle of bringing a site back online can create continued downtime, which can negatively impact a company’s bottom line.

Additional challenges with rapid scaling include maintaining inventory and providing effective fulfillment; costs associated with fulfillment alone often cut sharply into margins. The processes of adding inventory, picking, packing, and shipping require sufficient warehouse space, efficient fulfillment operations, and a flexible platform. When these challenges interfere with a company’s ability to grow, switching to a new eCommerce platform and integrated logistics provider may be a smart option.

Take-away: Growth is critical to business success, and—for online businesses—the right technology is critical to growth. When technology limits growth, it might be time to migrate to a new eCommerce platform.

webstore.amazon.com4© 2014 Amazon.com, Inc. or its Affiliates

LOW AGILITY

Some businesses don’t need to make many changes after launching their site. However, for other businesses, agility is vital to remaining current and so is the technology that enables it.3 Basic components, such as site navigation and site structure, can slow a business down if the technology managing them isn’t up to speed. If a company’s current eCommerce platform doesn’t allow the level of flexibility needed to effectively implement changes to these components, the business can fail to serve customers and remain competitive. Inability to make needed changes quickly is another sign that a migration may be in order.

Often, businesses choose to employ quick fixes to ensure the website can keep up with this demand.4 Too many of these fixes can result in a convoluted system that doesn’t solve the platform’s underlying lack of flexibility. A system that includes a collection of cobbled together “solutions” may inhibit efficiency and functionality, and make a site appear cluttered or poorly designed. When a website becomes unmanageable and unable to keep up with the latest eCommerce technology5, switching to a new eCommerce platform may be the way to go.

On the other hand, it’s important to find an eCommerce solution that fits the business. Standish Group found that 45 percent of system features are never used, and another 19 percent are rarely used.6 If the system is bloated with features and functions the company doesn’t use, it might not be right for the business, and may also signal the need to switch platforms.

Take-away: Online retailers need to be able to respond quickly to changes in the industry and business needs. When technology gets in the way, it may make sense to explore new eCommerce platforms.

webstore.amazon.com5© 2014 Amazon.com, Inc. or its Affiliates

POOR USER EXPERIENCE

Quick fixes, add-ons, and other technology limitations not only make an eCommerce site appear cluttered, but also decrease overall usability. Customers don’t see the backend of an eCommerce platform, but these limitations often show up on the frontend as slow page load times, unclear navigation, and poor search results. Such experiences don’t conform with customer expectations for best-in-class eCommerce sites.7

Twenty percent of mobile shoppers who have a poor shopping experience complete the transaction, but vow never to return to the site; another 18 percent abandon the site altogether.8 When in the eCommerce business, competition is just a click away, so when technology begins to impact the overall customer experience, companies may not be able to afford not to migrate to a new eCommerce platform.

TOO LITTLE FLEXIBILITY

When business objectives change, so should a company’s technology plan. Tracking metrics closely, reaching a broader customer base, expanding into international segments, and providing new services (such as social media functionality) are all examples of initiatives that could require a more robust and flexible eCommerce platform.9 Often the ability to integrate with third-party systems may be limited or an in-house solution might be overly burdensome, restricting a company’s ability to meet new goals. If a company wants to meet redefined goals by introducing new capabilities or taking advantage of technology innovations, a replatform may be required.

Take-away: Some usability issues are related to backend problems, and may indicate a need for a platform change.

webstore.amazon.com6© 2014 Amazon.com, Inc. or its Affiliates

However, companies should be careful to base the decision to switch to a new eCommerce platform on real data and not to rely on guesswork. Forrester Research found that 63 percent of companies decide to migrate based on “perceived ROI.” In other words, they believe or have a hunch about the ROI as opposed to developing one built

on a defensible economic model. In addition, 54 percent decide to migrate based on “internal company demands.” In other words, companies may feel pressure to implement a new eCommerce platform from different groups within the organization, or based on executives’ wishful thinking.10

INADEQUATE DATA SECURITY

Customers expect eCommerce sites to offer the best security possible11, and loss of customer trust could mean loss of sales. To maintain integrity and continuity, companies must keep data secure. In addition, businesses must ensure they’re compliant with security best practices.12 While existing systems might offer some safeguards, a switch to a different eCommerce solution may ensure that all security and compliance concerns are addressed.

Take-away: New technology should be considered whenever company goals are updated. Not all changes will require migrating to a new eCommerce platform, but big shifts in company direction might demand it.

Take-away: Data security is critical for both companies and customers. Replatforming may address key security concerns.

webstore.amazon.com7© 2014 Amazon.com, Inc. or its Affiliates

EXCESSIVE COST

The cost to maintain an eCommerce platform can become burdensome, pushing operational expenses beyond a company’s economic comfort zone. Hardware, software, support agreements, and personnel costs may all contribute to this cost.13 Additionally, on some platforms, retailers must pay higher fees when they reach higher traffic numbers.14

Based on a study conducted by Forrester, for many companies, the average cost to support an eCommerce system is 7 percent of online revenues.15 Each company’s threshold for cost is different, so each should carefully consider how much is too much to be spending on their eCommerce platform, based on performance, revenue, competing costs, and other factors. When expenses for the current platform seem too high, businesses should consider migrating to a more affordable solution.

Take-away: Many components associated with running an eCommerce platform can drive costs up. Companies should consider alternative eCommerce solutions when costs start to exceed benefits.

webstore.amazon.com8© 2014 Amazon.com, Inc. or its Affiliates

SUMMARY

Moving to a new eCommerce platform is a big undertaking that shouldn’t be taken lightly. Companies that want to grow, expand, change, and continue to meet customer requirements should spend the time to evaluate whether their current platform falls short in any of the following ways, and determine if they need to migrate:

• Lack of scalability. To support growth, online businesses often need updated technology.

• Low agility. Online retailers need the ability to make minor changes with minimal resources. An eCommerce platform that doesn’t tie up valuable IT resources and time is crucial for success.

• Poor user experience. How customers interact with the site is a key determin-ing factor of success. Current eCommerce technology can help businesses reduce usability problems, keep sales up, and remain competitive.

• Too little flexibility. Smart businesses change their goals and objectives based on company growth and other influences. The right platform may help you deter-mine whether those goals can be met.

• Inadequate data security. Trust is key in eCommerce success and companies gain customer trust when their sites are safe and secure. An outdated system may not have the capabilities to keep security robust.

• Excessive cost. In addition to the eCommerce platform itself, companies must pay for the equipment and person-nel to run it. All these costs add up and businesses should consider when a new platform might provide better value.

webstore.amazon.com9© 2014 Amazon.com, Inc. or its Affiliates

Amazon Webstore is a complete commerce platform that enables companies to leverage Amazon technology and expertise in building and managing their direct-to-consumer business.

Commerce sites built on the Amazon Webstore platform utilize Amazon’s powerful cloud infrastructure and payment processing technology to deliver a scalable, secure online shopping experience to customers. Amazon Webstore also integrates seamlessly with selling on the Amazon Marketplace and using Fulfillment by Amazon, Amazon Prime, and other Amazon Services.

To get started with Amazon Webstore, visit the website at webstore.amazon.com or contact the Amazon Webstore team directly.

webstore.amazon.com10© 2014 Amazon.com, Inc. or its Affiliates

1 Ecommerce Partners. “Understanding eCommerce Re-platforming.” Accessed November 15, 2013. |http://www.

ecommercepartners.net/infographic/replatforming.pdf.

2 OSF Global Services. “Is It Time to Re-platform Your Ecommerce Website? Insights, tips and guidelines for your

journey.” Accessed November 15, 2013. http://www.osf-global.com/assets/uploaded_files/ecommerce-website-

re-platform.pdf.

3 OSF Global Services. “Is it Time to Replatform Your Ecommerce Site? Insights and tips for a smooth and seamless

journey.” Accessed November 5, 2013. http://www.osf-global.com/assets/uploaded_files/en/re-platform-

ecommerce-website-OSF-white-paper.pdf.

4 Ibid.

5 Optaros. “Is it time for a new eCommerce platform? When to Make the Leap so You Don’t Fall Off the Edge.”

Accessed November 7, 2013. http://www.optaros.com/insights/blog/it-time-new-ecommerce-platform-when-

make-leap-so-you-don%E2%80%99t-fall-edge.

6 Ibid.

7 Thanx Media. “How do you know when it’s time to replatform your Website?” Accessed November 8, 2013.

http://blog.thanxmedia.com/blog/2013/08/13/how-do-you-know-when-its-time-to-re-platform-your-website/.

8 OSF Global Services. “Is it Time to Replatform Your Ecommerce Site? Insights and tips for a smooth and seamless

journey.” Accessed November 5, 2013. http://www.osf-global.com/assets/uploaded_files/en/re-platform-

ecommerce-website-OSF-white-paper.pdf.

9 OSF Commerce. “Is It Time to Re-platform Your Ecommerce Website?” Accessed November 11, 2013.

http://www.osf-commerce.com/re-platform-ecommerce-website-article.

10 Marketing Darwinism. “6 Things to Keep in Mind When Replatforming.” Accessed November 15, 2013.

http://pauldunay.com/6-things-to-keep-in-mind-when-replatforming.

11 OSF Global Services. “Is it Time to Replatform Your Ecommerce Site? Insights and tips for a smooth and

seamless journey.” Accessed November 5, 2013. http://www.osf-global.com/assets/uploaded_files/en/re-

platform-ecommerce-website-OSF-white-paper.pdf.

12 OSF Global Services. “Is It Time to Re-platform Your Ecommerce Website? Insights, tips and guidelines for your

journey.” Accessed November 15, 2013. http://www.osf-global.com/assets/uploaded_files/ecommerce-website-

re-platform.pdf.

13 OSF Global Services. “Is it Time to Replatform Your Ecommerce Site? Insights and tips for a smooth and

seamless journey.” Accessed November 5, 2013. http://www.osf-global.com/assets/uploaded_files/en/re-

platform-ecommerce-website-OSF-white-paper.pdf.

14 WooThemes. Why we often price e-Commerce projects wrong. Accessed December 3, 2013.

http://www.woothemes.com/2013/09/why-we-often-price-e-commerce-projects-wrong/.

15 Ibid.