Mid-Market Merchants And The Ecommerce Landscape

Statista data shows US ecommerce sales will reach an estimated $1 trillion by 2027, and ecommerce platforms that facilitate these online purchases are taking note.

Adobe buying out Magento for $1.68 billion is just one of several examples where large-scale enterprises are acquiring ecommerce platforms to expand their reach in this space.

Post-acquisition, we often see these ecommerce platforms shift their focus to large-scale growth. However, that shift to enterprise growth focus often ignores the mid-market merchants in the annual gross merchandise range of $10 million to $250 million.

These mid-market ecommerce companies aren’t small enough to be considered startups, but they aren’t always large enough to afford massive enterprise-scale ecommerce growth platforms, either.

This creates a gap wherein mid-market merchants struggle to find ecommerce solutions with the right functionality and technology to help them grow.

According to Phillip Jackson, co-founder of FutureCommerce, the dearth of options forces these mid-market ecommerce businesses to adapt to the existing limitations of software platforms (rather than the other way around.)

“If you’re a mid-market merchant who built a digital channel five to seven years ago, you’re stuck on legacy tech, and now you’re going to have to replace every part of the stack (and team competencies) again,” he said. “The entire ecommerce software market has coalesced around software that no longer cares about the middle market.”

Christopher Carson, CRO
at ecommerce agency Above The Fray, echoed this thought, explaining that the lack of options for the mid-market merchant creates a technology lag that can stunt these players’ long-term growth trajectories.

Because of the lack of platform options that suit these merchants’ needs, “[replatforming] keeps getting put off and kicked down the road,” he said.

This is a major issue, as good digital customer experience is more important than ever. According to Gartner
, 83% of B2B buyers now prefer ordering or paying through digital commerce, and a poor online experience means lost conversions and sales.

With these sentiments in mind, Shopware is one ecommerce platform positioning itself publicly as a viable solution focused on serving this “forgotten” mid-market merchant and their unique needs.

They believe one key to doing this well is leveraging open-source technology. As a headless commerce platform built on Symfony and Vue.js, developers fluent in PHP can help merchants expand their offerings with Shopware’s built-in tools without large-scale investments in highly customized build-outs.

Shopware’s features also cater to a mid-market need, which is B2B sales. In ecommerce alone, B2B sales are worth over $2.7 trillion annually.

Pricing is a frequent sticking point for these buyers, as they need to find ways to create favorable pricing matchups without discounts so steep they risk eroding their profits.

Shopware’s solution is to offer merchants the ability to publish tailored content for different customer segments—which can include unique pricing arrangements suitable for the B2B market.

Additionally, any company that’s just made the leap to mid-market may need a “turnkey” solution for its ecommerce needs, as a full-scale enterprise solution designed for massive companies can be too complicated. Shopware is working to position itself as a platform that addresses those needs.

One example of this can be seen in that this platform supports omnichannel customer marketing in ways that allow mid-market companies to compete with larger enterprises.

This creates a rare combination of accessibility and enterprise-level scale, according to Yitz Lieblich, CEO and Founder at Web Solutions NYC.

“Shopware is like if Magento and Shopify had a baby. You’ve got the ease of use of Shopify, the SaaS, the UI/UX interface, but then you’ve got the power and scalability of Magento, as Shopware is fully open-source,” he said.

Being open-source also helps connect Shopware developers. Shopware insists on app ecosystem dynamics—features that help growing mid-commerce merchants unlock more advanced marketing capabilities—help mid-commerce merchants obtain top-of-industry scale without increased complexity.

If you ask Dustin Hickle, Director of Sales and Marketing at Unleashed Technologies, mid-market merchants are looking for new platforms that meet their needs. “I think there’s more appetite than ever for a mid-market solution,” he said.

The stats bear this out. According to Klaviyo, the mid-market segment is the “most likely to report a significant increase of marketing spend.” Over half of mid-market merchants (52%) planned to increase customer acquisition efforts in 2024. Platforms like Shopware are just scratching the surface of what this mid-market segment can achieve.

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Source Link: https://www.forbes.com/sites/kaleighmoore/2024/05/15/mid-market-merchants-and-the-ecommerce-landscape/