Ecommerce SaaS: key features, leading platforms, and benefits
How does SaaS ecommerce work?
Hosted in the cloud, SaaS ecommerce platforms don’t require downloading and installation on a computer and can be accessed via an internet browser. In addition to providing ready-made web store solutions, ecommerce SaaS vendors cover their hosting, security provision, backups, and updates. Business owners sign up for a platform, select a store template, add necessary functionality, and proceed to create product catalogs and sell online. Ecommerce SaaS companies charge regular fees for using their software and offer different subscription plans to accommodate businesses of various sizes.
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Scheme title: SaaS ecommerce setup
Data source: ecommerce-platforms.com—The state of open source ecommerce platforms
SaaS vs. open-source ecommerce: key differences
A popular alternative to SaaS solutions is open-source ecommerce software. Although it can be hard to distinguish the two just by comparing online stores built on them, these platforms’ functionalities, store setup and management requirements, and customization options are fundamentally different. You can always turn to ecommerce software experts to help you choose which model suits your business needs the best.
SaaS ecommerce platforms are owned by ecommerce SaaS providers and run on their servers. They come as ready-to-use solutions with a few customization options and no access to the source code. Users only rent the software without the ability to change it fundamentally.
Open-source ecommerce platforms provide users access to source code, which they can download and modify, customizing the solution for their specific business needs. Thus, users take full responsibility for using the code to create and maintain online stores.
Ecommerce SaaS users subscribe to a monthly or yearly plan and pay fixed fees for using the platform. The fees also cover hosting, security, and software updates, so merchants don’t need to invest in their stores’ maintenance. Moreover, this payment model usually provides several subscription tiers so that companies can downgrade or upgrade to other plans in line with their current business needs.
Open-source platforms are generally free to download and use. However, store owners have to pay for web hosting, security and compliance provision, customization, integration with third-party apps, and store maintenance. In addition to the initial investment and regular maintenance expenses, merchants should update and modify the store and hire in-house specialists or a third-party team.
Ecommerce SaaS providers take necessary measures to ensure stores’ security and PCI compliance. They regularly release updates and automatically install new security features to protect ecommerce sites and customers’ payment data.
Companies opting for an open-source ecommerce platform are ultimately responsible for meeting PCI requirements, ensuring data protection, monitoring site security, and providing updates and bug fixes as needed.
Even merchants with no software development specialists can easily create stores by selecting pre-designed themes, modules, and add-ons in a beginner-friendly website builder. In addition, SaaS platforms usually have a free trial to let users explore the platform before subscribing to a paid plan.
Setting up a store based on an open-source platform requires sufficient coding knowledge.
SaaS platforms offer limited customizability compared to open source, but many vendors provide pre-built features and easily-customizable templates. Many vendors also have marketplaces providing a curated selection of extensions and APIs for third-party developers.
Open-source platforms provide unlimited customization options for storefront design, product pages, and checkout. However, businesses should hire certified developers to handle these complex changes.
Maintenance and support
Merchants running a SaaS-based store rely on the provider to perform maintenance operations, fix performance issues, and update the software. As part of the service package, SaaS users can directly contact support specialists through help desks.
Retailers have to take care of their open-source store’s maintenance, support, and updates. If an issue occurs with the system, they should find out how to resolve it and make fixes on their own or turn to third-party developers. Open-source ecommerce vendors can provide technical support only for an additional fee.
Ecommerce SaaS is popular among startups and SMEs that don’t have a mature IT infrastructure but are on a limited budget and need to handle increasing traffic. However, SaaS is also a good option for large companies focusing their efforts on business development rather than on the site’s infrastructure, maintenance, and security.
Open-source software is in demand among enterprises with in-house IT teams. Open-source platforms are also a good choice for companies that need full control of their platforms’ design and functionality and have enough budget to set up and maintain an open-source infrastructure.
Industry experts say
Open-source and on-premise solutions force businesses to build their own platform from a coding level and implement software updates themselves, respectively. Both scenarios take time that businesses cannot afford to waste.
Gregg D. Copeland
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Top 7 ecommerce SaaS platforms
According to the Gartner Magic Quadrant for Digital Commerce 2022, these seven ecommerce SaaS platforms keep up with today’s industry standards and demonstrate a clear vision of future development.
Scheme title: Magic Quadrant for Digital Commerce
Data source: Gartner, 2022
Previously known as Magento Commerce, it’s a flexible and easily scalable cloud-based platform-as-a-service (PaaS) solution. The PaaS model slightly differs from SaaS, providing a ready-to-use platform for developing and running ecommerce stores in the cloud. Adobe also offers a free open-source ecommerce solution Magento Open Source.
- Multi-brand management from a single platform
Integrated payment and fraud protection
Cross-channel shopping enablement
Advanced search capabilities
Embedded Adobe Sensei AI-powered dynamic content, tiered pricing, and personalized recommendations
Real-time inventory management with sourcing and stock tracking across the distribution network
SEO and marketing tools
- Over 3,600 native extensions in Adobe Commerce Marketplace for payment, tax, and shipping management
Integration with retailers’ in-house CMS, ERP, CRM, and marketing automation systems
Business intelligence features for real-time ecommerce metric analysis
150 language packs and regional extensions
Compatible with other products from the Adobe bundle
99.99% operational uptime
Medium and large B2B, B2C, and hybrid commerce enterprises
Amazon sales channel with access to Sell On Amazon features Efficiency, versatility, and ease of use
A steep learning curve API customization requires vendor-sponsored developers Some B2B functionality is missing
Customized pricing on demand
Powers more than 315,000 sites globally, including HP, Helly Hansen, FoodServiceDirect.com, Liebherr, Rossignol
Ecommerce SaaS benefits
By opting for SaaS, companies can reduce ecommerce platform development, deployment, and maintenance costs.
Ecommerce SaaS platforms offer all the basic functionality for online stores. With user-friendly interfaces and pre-built themes, companies can quickly set up a store and enter the market.
Easy to maintain
Since SaaS ecommerce providers take care of software updates, bug fixes, and server maintenance, companies can do without a dedicated IT team.
PCI-compliant and secure
All major SaaS ecommerce platforms are PCI-compliant, mitigating regulatory risks for companies and ensuring that customers’ sensitive financial information is well-protected.
SaaS ecommerce platforms allow adopters to expand storage and add new functionality and sales channels, enabling unlimited scalability.
Common challenges of ecommerce SaaS
While SaaS solutions provide multiple payoffs and growth opportunities, this ecommerce model still has some shortcomings that merchants should be aware of.
Limited customization opportunities
Ecommerce SaaS solutions use built-in, easily configurable templates and features that limit the customization scope.
Ecommerce companies using SaaS software can establish a headless architecture to enable API-based app integrations and personalization of the frontend and storefront functionality. However, if retailers require extensive customization to fit their unique business needs, they should opt for an open-source ecommerce platform instead.
Lack of control
Since SaaS ecommerce platforms run on the provider’s servers, companies don’t have control over them and fix emerging problems themselves.
Ecommerce businesses should choose a reliable SaaS platform that provides regular software updates, performs automatic store checks for early problem detection and downtime prevention, and offers 24/7 technical support to resolve any issues.
Switching from a SaaS solution to another ecommerce platform is associated with substantial costs and complexity, which makes businesses dependent on their initial choice.
When choosing a SaaS ecommerce platform, retailers should study the provider’s offer in advance and consider their scaling potential so that their business won’t outgrow the platform’s capabilities too soon. What’s more, companies should keep backups of all the data they store in a SaaS solution to mitigate the risks of future migration.
Launch a SaaS-based store with expert help
SaaS ecommerce platforms allow for time-to-market acceleration and require significantly lower upfront costs. Although their customizability is more modest than that of open-source solutions, ecommerce SaaS platform providers are reacting to the current market demand for greater flexibility and introducing changes to overcome this restriction. This way, SaaS ecommerce platforms are the best choice for retail companies wanting to quickly react to ever-changing market trends and meet constantly fluctuating customer needs and wants. However, if you hesitate whether SaaS commerce is a good option for your business, Itransition can help you decide which ecommerce software type and SaaS platform suits your requirements and growth plans the best.
Consumer purchasing habits, expectations, and demands evolve at a rate that is nearly as fast as eCommerce technology. We observed this personally when the epidemic altered not only what people bought, but also how they bought it. With cutting-edge capabilities like personalized search, dynamic testing, and personalized product suggestions, SaaS e-commerce allows companies to quickly respond to changing consumer needs.
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Ecommerce SaaS: common questions answered
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