Its microservices-based architecture and powerful business and developer tools are popular with companies that want to future-proof their ecommerce solution and manage their total cost of ownership (TCO).
Why VTEX is ‘visionary’
This year the platform has moved from ‘niche player’ to ‘visionaries’ in the 2020 Gartner Magic Quadrant for digital commerce.
A number of factors have contributed to this recognition, including the company’s:
- unique marketplace
- ecommerce and order management system capabilities
- geographical expansion.
Headquartered in Rio de Janeiro, in November 2019 the company secured $140 million to fund an expansion into North America, Europe and Asia.
The majority of its customers are B2C companies, although it is now growing its B2B enterprise customer base, which already represents 20% of its users. The next big push for VTEX is to establish itself in the North American market.
What makes VTEX different
VTEX is a cloud-based multi-tenant software as a service (SaaS) platform designed to help businesses manage their evolving multichannel needs.
It embraces the concept of composable commerce, as the next step from headless ecommerce. The principle is to empower businesses to select, assemble and use solutions that meet their specific commercial needs, focussed on business outcomes.
The combination of VTEX Commerce in the cloud with the VTEX IO development platform allows customers to create online experiences and connect data sources. New applications can be designed, built and implemented quickly and flexibly.
In principle, this approach allows solutions to be assembled when needed, depending on customer and touchpoint requirements, where an ecommerce site might be just one of many experience types.
Centralized order management – VTEX features an OMS that helps businesses to unify their operations, streamlining purchasing, fulfilment and product returns.
Optimized operations – the order lifecycle can be seen as a ‘single source of truth’ by orchestrating information to optimize inventory and logistics and to identify the best route for product distribution. There’s also smart in-store point of sale (POS) functionality to enhance shopping experiences including features such as abandoned cart recovery, optimized promotions and personalized services.
Integration – VTEX is designed to integrate with your existing customer relationship management (CRM), enterprise resource planning (ERP), and warehouse management (WM) systems. Its suite of APIs supports a 360º management approach with real-time information on product delivery, availability and package tracking, for example.
Marketplace – combined with its OMS and ecommerce platform, the marketplace functionality makes VTEX distinctive. Marketplace platforms to drive digital revenue are becoming popular for B2C retailers and, increasingly, for B2B ecommerce. Typically, businesses that want to launch a marketplace will need separate technology and integration, which can be expensive.
Breadth – the platform includes features that are suited to medium-sized ecommerce businesses, allowing them to create an end-to-end process, including digital asset management (DAM) and product information management (PIM), a customer database, an OMS, and fulfilment. These options are likely to attract larger enterprises as the company grows and expands outside of Latin America.
Extensibility – VTEX IO was launched earlier this year as a low-code development platform that enables customization with improved performance management, scalability and security. There are also more than 20 modules for the platform to add agility and speed-up enhancements.
Topics to watch
B2B capabilities – VTEX has improved the platform’s B2B functionality, but this is still a relatively small part of its customer base.
Locality – the majority of VTEX customers are currently in Latin America, although there are ambitious expansion plans. Businesses looking for a fully global solution might have difficulty finding local partners. The user administration console is currently limited to English, Portuguese and Spanish.
Personalization – the platform has more development work to do to meet the native ecommerce personalization capabilities of some competitors.
The VTEX roadmap
VTEX is certainly focussed on growth and says it intends to help create the world’s fastest growing and highest converting stores.
There will be major investment to develop content management, the site editor, catalog management, and VTEX IO.
The growing trend for increased engagement between sellers and customers has made collaborative commerce a priority, with plans to offer more tools for the platform’s integrated order management, ecommerce, and marketplace capabilities.
With unprecedented levels of online buying, the ability to seamlessly and robustly handle increased demand is also an important area for development. As business models have been redefined during the coronavirus pandemic, omnichannel ecommerce will be included in VTEX future plans.
We think VTEX is one to watch for businesses interested in creating a flexible online presence. To find out more, speak with one of our experts.