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September 20, 2020
SaaS or Magento – Where to Take Your First E-commerce Step
The appearance of our online store is, in fact, the first and most important decision – after determining the industry we want to operate in – that we must make when creating a business based on an electronic distribution channel. In this case, appearance means less about colors, font styles, or text placement on the site. The key importance lies in technical aspects that can determine the way we conduct business for years.
WHAT DOES THE MARKET SUGGEST?
An entrepreneur taking their first steps in online trade basically has two options. The first is purchasing a subscription for remote use of software for a specified period. This model, abbreviated as SaaS (Software as a Service), means that the service provider delivers the client, among other things, software, a server, and a technical domain, which the client accesses via a web browser. In this way, they receive a ready-to-use product capable of practically immediate operation and mainly need to remember to regularly pay the subscription fee.
In this case, updates, server security, providing IT infrastructure, and technical support fall within the service provider's responsibilities. Sounds convincing? Both yes and no. The SaaS model is primarily dedicated to clients who do not have clearly defined needs regarding how their store should look. Purchasing a subscription gives them access to most basic functions, and the time saved on technical management, at least in theory, allows them to fully focus on running the sales process in every sense of the term. Financial aspects also play a crucial role in choosing this option – the economy of scale makes it possible to offer a standardized service to the mass market, which would be much more expensive in individual cases.
AN ALTERNATIVE NOT JUST FOR INDIVIDUALISTS
At the opposite end lies open-source software. Thanks to it, an online store can completely free of charge obtain a solid foundation on which we can build everything else. The question remains, however, how much we will have to invest to adapt such a base to our needs. While the SaaS model can be compared to ready-to-wear clothing, the solution based on open-source software is like a tailored suit. An example of such "clothing" is Magento. Its free version – Community Edition – is a very good option for those who are not afraid to take the risk associated with independent management. With this, possessing a server and domain allows us to create the framework of our own store's operation. With access to modifiable software, we can customize its appearance and functionality to our needs at any time.
Considering the market's dynamics and ever-changing human needs, this solution may prove to be the key to success. Such possibilities can never be provided by the SaaS service, which by definition does not include atypical solutions. However, a broader scope of operation also means greater responsibility. Like SaaS, Magento is an option that, from the very beginning, provides users with basic functionality. However, wanting to further develop it, we will face the need to deal with the technical side of a PHP-based platform, which requires programming experience or the support of an external company.
CASE STUDY
A simple example illustrating what sets Magento stores apart from those based on SaaS could be the integration of a sales platform with the new version of a dedicated plugin updated by a popular courier company. In the first case, the service provider would handle it for us, while in the second case, this task would have to be done manually. What seems like a disadvantage can, in certain circumstances, become an advantage.
Imagine that a carrier offering favorable terms from our perspective enters the market. If we were clients of a subscription system, we would have to wait for the service provider to act, who would only start working towards integration with the new company when forced by the market. In other words, if we were among the few waiting for the availability of a given option, the provider might not develop it at all. With Magento, the decision is in our hands. We ourselves decide whether and when we want to collaborate with a new business partner, and we can conduct the integration anytime.
Thanks to this, we get a chance to outpace the competition with a solution that has not yet gained widespread use. Here lies the very essence of Magento, which, more than SaaS, is suited to the realities of a dynamically changing market. This feature makes Magento currently one of the most dynamically developing e-commerce platforms, used by over 260,000 entrepreneurs worldwide.
MAGENTO: HOW TO APPROACH IT?
The costs associated with launching, albeit a free platform, range from several to tens of thousands of PLN. It is easy to calculate that such an amount could allow us to run a store in a subscription system for over a year. We must answer the question ourselves: what is more beneficial for us – to regularly pay a subscription fee and enjoy functional infrastructure, or to take a risk and create a more independent (and possibly better) vision of our business? It is worth remembering that competitiveness, in this case, means not only the availability of goods and fast shipping but also the ability to reach the customer with our offer.
This can be influenced, for example, by the implementation of above-standard, advanced search and filtering options, dedicated CRM and ERP system integrations, or the appropriate design of a product configurator. These are possibilities that are rather difficult to achieve in the SaaS model. Magento is also much more flexible when it comes to code optimization for SEO compared to any subscription-based platform, where often it is limited to setting the title, description, and keywords displayed in search results. The aforementioned costs, however, result from the need for labor- and time-intensive configuration of the relatively complex Magento system. This platform, besides its relatively complicated architecture, also has, for example, high server requirements.
Launching a store with the help of a specialized agency experienced in e-commerce ensures security and the confidence that the website will operate in line with our expectations. However, starting the store is not everything: just as important, if not more so, is the subsequent maintenance of its technical side, installing additional modules, and developing new features. Only this allows for the building of a technological edge in the highly competitive e-commerce market. Therefore, if we have decided to go to a tailor, let's make sure that they have the necessary experience and are willing, even years after the last visit, to add an extra pocket, replace a lining, or sew on a missing button.
