This article has been updated with two further pieces of content…
Continue to read this article for a summary of some key commercial differences between the US & EU markets with regard to selling ecommerce technology.
The U.S. has the second-largest e-commerce market in the world. With $340B in annual sales, we lag only behind China. As of this writing, solutions in the headless category have raised over $2.5 BB in funding. While European nations like the U.K. and Germany still rank within the top five, combined, they still represent less than half the e-commerce global market share that the U.S. commands. With that in mind, it begs the question: Why are European nations quicker to adopt headless e-commerce—the new, innovative approach to e-commerce that’s quickly becoming the new normal?
What Is Headless E-Commerce?
Headless e-commerce separates front-end experiences from back-end data and functionality. It allows developers to use the API platform to deliver its best feature to any user experience, without causing any disruptions to back-end data. Headless e-commerce only requires APIs to communicate between the back end and front end of the platform, unlike traditional e-commerce platforms that combine front- and back-end data and offer limited flexibility. As a result, headless e-commerce offers the following advantages:
- It’s easier to implement, use, and maintain.
- It requires little to no coding.
- It’s more affordable.
Again, however, if headless e-commerce offers such compelling benefits, why isn’t it being embraced as readily in the U.S. as in Europe?
Why Are Headless E-Commerce Sales Higher in Europe?
Even though the U.S. holds a much larger market share for e-commerce, U.S. brands are still behind with headless e-commerce adaptations. Here are a few possible reasons why.
Leading Headless Platforms are Based in Europe
Some of the world’s first headless platforms were developed in Europe, so it makes sense that European businesses would be more likely to embrace them. Commercetools is headquartered in Munich, while Spryker is headquartered in Berlin.
“I think the simplest explanation is that the first entirely headless commerce platforms were created in Europe,” says Anthony Young, Head of Global Alliances for Spryker. “It would follow that early adopters would be regionally biased to be in those same countries. This would have a follow-on effect through the years — a kind of first mover advantage that has compounded.”
Patrick Friday, CEO of Vue Storefront, agrees. “A lot of great companies advocating for headless are from Europe, and this is where they started market education, as it was just much simpler. There’s Vue Storefront, Commercetools, Contentful, Storyblok, Prismic, Talon.one and many, many, more great companies with European headquarters.”
Europe’s E-Commerce Landscape Is More Complex
According to Jamus Driscoll, CEO of Elastic Path, “There is built-in complexity in EMEA with different languages and varying legislation across countries that means a one-size-fits-all SaaS solution always requires customization.” Eastern Europe, in particular, has been a massive resource for EMEA with deep technical skills. As the market has matured, these skills have allowed businesses to hire locally and inexpensively to support headless deployments.
“Selling in the EMEA is more complex,” says Eric Ingraham, CEO of Swell. “Optimizing for that complexity by improving the customer experience has a higher benefit/cost ratio than what we do in the U.S. currently.”
No matter the reason, it’s clear that although Europe may embrace headless e-commerce more readily right now, U.S. companies are poised to catch up soon. As a leader in e-commerce recruiting, The Rosenstein Group helps U.S.-based companies leverage new technology that will drive better business results and customer experiences. For more information, send us a message.