GD White Paper Digital Commerce Modernization

Grid Dynamics Whitepaper
Digital commerce
modernization
the definitive composable
commerce playbook
www.griddynamics.com
Grid Dynamics | Digital commerce modernization
Contents
Introduction 3
Why do retailers need to modernize their monolith 4

e-commerce systems?
Reimagining customer experience differentiation 7

with composable commerce and MACH
What are the benefits of composable commerce and 9

MACH?
A phased modernization approach to achieve 12

competitive customer experience personalization
The elements of a best-in-class composable digital 15

experience platform
Ready to start your digital commerce modernization 35

journey?
About Grid Dynamics 36
Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 2

In this whitepaper, we provide an outline of a

winning digital commerce modernization strategy
with a focus on non-transactional business
capabilities as the first step to achieving end-to-end
customer experience personalization.
Introduction Along the way you’ll learn:
Why monolith e-commerce solutions are no

longer sufficient for retailers in the modern
age;
There’s no denying that things have

changed drastically over the past few years How composable commerce enables an
as a result of the COVID-19 pandemic - from iterative, modular approach to
consumer shopping behaviors to business modernization that ensures continuous
operating models and the exponential business operations without disruption;
acceleration of the digital economy. And it
happened so fast that legacy, one-size-fits-
all technology systems, once appreciated
How the MACH approach to composable
for their rigid steadfastness, simply can’t
commerce empowers retailers to
keep up with the rapid pace of change
continuously innovate at scale with best-in-
simply can’t keep up. Retail companies in
class software components for each area of
particular realized that their e-commerce
business;
applications suddenly needed to be faster,
more flexible and scalable than ever before.
Coupled with these new technology
requirements came the clanging demand for Why modernizing non-transactional
personalized digital customer experiences, elements of the e-commerce system before
augmented product discovery convenience, transactional elements is the smartest
and seamless checkout, payment and approach to strangling the monolith;
fulfillment journeys.
How can retailers adapt as quickly and

efficiently as possible? The answer lies in How best-of-breed digital commerce
breaking apart the e-commerce monolith bit solutions enhance customer experience,
by bit, starting with critical business propel conversions, and drive revenue to
priorities, on a composable architecture start off the e-commerce modernization
based on MACH (Microserves, API-first, journey with a bang.
Cloud, Headless) principles. When it comes
to critical business priorities for retailers in
the new digital economy, customer
experience is definitely king.

Why do brands need to

modernize their
monolith e-commerce
systems?
Many of today’s leading retail enterprises built their
first digital commerce platforms on a monolith
architecture. Such application suites - think ATG or
Endeca - were very attractive at the time when
digital strategies were initially being integrated into
the business model of retailers. They represented an
easy way to get a base structure with a full suite of
technology to fulfill retailers’ early e-commerce
requirements. The all-inclusive monolith solution
typically encompasses all the essential functionality
like product catalog, search engine, shopping cart,
payment, and shipping. As these technologies are
provided by a single vendor, they integrate to each
other very easily, often via closed, proprietary
means, while additional capabilities can be
delivered through customization or extensions.
While these monolith solutions once fulfilled the

needs of retailers and online shoppers before
pandemic lockdowns and the digital commerce
explosion, as the experience economy evolved and
consumer behavior changed over the years, e-
commerce flexibility and customer experience
personalization have since become new priorities
for retailers, and technology requirements have
moved beyond what the monolithic architecture can
offer. Retail brands now need to be able to adapt to
change faster than what monolithic systems add
feature updates to their roadmap.
Monolithic apps are rigid in terms of responsiveness

to business needs. In a monolith architecture, the
user interface is so intricately bound with the
server-side logic that the smallest modification of
any user-facing component will inevitably lead to
disruptions throughout the entire platform. This
presents immense complexity for the software
engineering team, leading to slow development
speed, dependencies, and zero possibility of gradual
scaling.
That same complexity means that retailers mounting on retailers to modernize their e-
can not respond quickly enough to commerce systems in order to keep up with
consumer behavior changes or emerging consumer demands.
market trends. Moreover, the many after-
market add-ons and technical debt incurred
to keep the monolith running often lock Change in shopping habits
organizations into outdated vendor 77% of consumers tried new ways to shop
relationships, hampering their ability to during the pandemic, with many of them citing
innovate or even compete. convenience and value as the reason. A
whopping 92% remain online shopping
converts today, with 51% of them reporting a
Rapid consumer behavior desire to splurge and indulge themselves in a
change requires flexible, fit of post-pandemic retail therapy.
best-in-class digital
commerce components Loyalty shake-up
The COVID-19 pandemic disrupted the lives 39% of digital consumers, mainly Gen Z and
and livelihoods of consumers and millennials, deserted trusted brands for new
businesses across the globe, forcing them ones that better reflect their values.
to embrace digital as the new normal.
Bound to the confines of their homes, some
92% of consumers abandoned erstwhile
shopping habits to become online shopping
Digital commerce surge
converts, and e-commerce accelerated Credit and debit card data reveals a nearly 20%
years of digital modernization into months increase in online spending since January 2020.
to meet the needs of this new explosion of E-commerce experienced strong growth, rising
digital consumerism.
by about 35% year over year, and online
penetration grew 30% higher than pre-
This new breed of digital consumer expects
COVID-19 levels.
services on demand, within minutes, and a
personalized experience to boot. How has
this impacted CTOs and business leaders?
Meeting these lofty expectations requires a Homebody economy
shift not only in technology, but a better
28% of consumers invested in amenities and
understanding of how customer behavior is
home goods to keep themselves occupied
changing, and how best-in-class commerce
during the lockdowns, and 30% more plan to
components can be weaved together to
continue spending on their homes post-
deliver the convenience, speed and
pandemic.
personalization that customers demand.
Consider these statistics from McKinsey’s

And if you thought post-pandemic e-commerce sales
studies on US consumer sentiment and
would revert to pre-pandemic levels, you’re wrong.
behaviors during the coronavirus crisis and
By the end of 2022, the share of online retail sales
Emerging consumer trends in a post COVID
excluding auto and gas will be 22.1%, up from 20.8%
19 world to see how the pressure is
in 2021 and 15.2% in 2019. While experts say the

pandemic accelerated the shift to online

shopping by as many as five years, that’s
not the only reason e-commerce is on the
rise.
The infiltration of technology into

consumers’ lives has proved to have a
massive impact on e-commerce growth.
Figures from DataReportal’s latest Global
Overview Report show that the number of
people shopping online worldwide grew
10% in 2022 to hit 3.78 billion. And up to
60.1% spent on these online purchases were
attributed to mobile devices.
Not only are more consumers shopping

online, they also have certain brand
expectations and demands for personalized
interactions. According to Salesforce
research, 66% of consumers expect
companies to understand their unique
needs and expectations, and 52% expect all
offers to be personalized to their shopping
behaviors and preferences.
That said, it’s no longer enough to apply a

“one-size-fits-all” approach. In order for
retailers to meet the rising demands of
consumers, they need the flexibility to
adapt to change with ease, the scalability to
expand rapidly, and best-in-class digital
commerce components to optimize each
step on the buying journey.
Enter composable commerce and MACH

architecture.

Reimagining customer experience

differentiation with composable commerce
and MACH
Composable commerce and MACH represent In such an architecture, it is common to have

a fundamental shift in how retailers can separate technologies for storefront, CMS, commerce
outpace the competition by 80% and (PIM & Promotions), search and so on. Because these
achieve unparalleled business flexibility by technologies can be provided by multiple vendors,
adopting a modular, component approach they are optimized for open, API-based integration.
to platform architecture.
They require integration and orchestration via API
management and cloud native backbones consisting
In a composable commerce solution, the
of foundational shared services and core business
desired business capabilities are delivered
logic.
through individual specialist technologies
that typically focus on a single capability
each.
Composable commerce blueprint

The MACH (Microservices, API, Cloud, Headless) approach to composable commerce helps to leverage
each specific application for its unique benefits to create a digital experience platform with best-in-
class capabilities, coupled with the automation, scalability and elasticity benefits of the cloud.
M Microservices
decouple business capabilities, establish bulkheads,
isolate changes
A API
API-first
allows for seamless data transmission between different
applications and services
C Cloud-native
enables automation, scalability and elasticity
H Headless
decouples UI from business logic, and engagement services
from back-office
The MACH approach to composable commerce

What are the benefits

of composable
commerce and MACH?
“The main reasons to go with MACH are centered
around the customer, not the technology,” – MACH
Alliance.
From a customer experience perspective,

composable commerce and MACH architecture is all
about simplifying change management and
responding quickly to customer demands.
The Headless architecture decouples the UI from the

platform, and the platform from the back-office
through APIs, allowing for ultimate flexibility, agile
delivery, and differentiation in customer experience.
Grouping microservices into packaged business

capabilities (PBCs) with well defined API perimeters
further decouples business functionality, enabling
granular build-vs-buy decisions, and opportunities
to select, integrate and experiment with best-in-
class SaaS platforms.
At the same time, an API-first approach greatly

democratizes access to data leading to improved
customer experience personalization opportunities
across the buying journey. For example, retailers can
benefit from the vastly expanded and connected
library of data about everything from customer
behavior and conversion rates to loyalty incentives
and next best actions.
Businesses that adopt a composable commerce

approach and MACH architecture are optimized for
business flexibility. They are empowered to react
rapidly to changes in the business environment,
meet consumer demand in the blink of an eye, and
run circles around the competition in a time where
an unprecedented level of channel switching and
brand loyalty disruption is a growing threat.
Other MACH opportunities:  

Data in motion
One of the biggest advantages of MACH, and The business value of event streaming can be
the data democratization aspect unlocked summed up as follows:
by MACH architecture, is how quickly
businesses can use this data to obtain Event streaming is not just a messaging
critical business insights. With access to system but also works to productize
real-time data, businesses have the data which helps to make sense of
opportunity to perform faster and better events for more meaningful analysis.
than their competitors. Powering effective
analysis of “Data In Motion” and “Data in Data can be analyzed in real time, e.g.
Rest” will unlock even more opportunities trend analysis.
for businesses in a data-driven world.
By default, MACH architecture is event- Analytics can be streamed in real time,

driven, and can be taken to the next level by e.g. stock movement analysis in
streamlining the production and different channels (online, in-store).
consumption of events. The general
approach to streamlining communication
You can easily move data for offline
between event producers and consumers in analysis, e.g to a data lake, data
a real-time data processing architecture is warehouse.
to use an event stream.
An event stream is a constant flow of events

ordered by time. The stream can be
processed in real time, with any kind of
analysis or transformation performed in less
than 20-30 milliseconds.
Besides configuring the communication flow

between event producers and event
consumers, an even streaming platform can
also store data, enabling applications to
query whatever data is available on-
demand.

With a single event stream integration that connects

Clickstream 
Analytics
Events all producers and consumers, data processing is
performed in real time, making it possible to retrieve
insights in the blink of an eye. Furthermore, the
Transactional  Event
Datalakes/ 
overall architecture is simplified with a single event
Events Stream Datawarehouse
stream integration that doesn’t need to be rewritten
every time there is a change to the system such as
Web  Monitoring 
new event sources or applications.
Events and Auditing
With an Event Stream
Without event streaming, the data movement

Source 1 Target 1
between various sources and targets requires a lot
more hops, and it follows a complex, point-to-point
Source 2 Target 2
integration pattern. This laborious process drastically
slows down the time-to-insights, and makes real-
time processing impossible.
Source N Source N
Without Event Stream

A phased modernization approach to achieve
competitive customer experience
personalization
Taking a phased or step-by-step approach When selecting legacy components for migration to
to modernization involves identifying and the new modernized platform, the best first
moving certain functionality to candidates are usually also:
microservices according to business
priorities. It is clear that customer

Loosely coupled with the rest of the
experience is table stakes for retailers, and system.
can, without a doubt, be classified as a
critical business component for any and

Aligned with plans for significant
every e-commerce system.
changes due to functional or
In light of this, a winning modernization performance requirements.
strategy should start with migrating non-
transactional components like the content

Primed to take advantage of dynamic
management system (CMS), search and
scalability and on-demand cloud
recommendations, pricing and promotions, resources.
and product information management (PIM),
followed by transactional elements like

Have expensive licenses that can be
inventory and order management, cart,
$
retired after migration.
checkout, payment and so on, to avoid
disruption of online sales.
Best first candidates for migration

High-level modernization roadmap

Based on the insights above, a typical modernization roadmap focusing on customer experience can
look as follows:
Assessment UI/UX, customer Product catalog Customer Profile

and discovery journey
Pricing and Shopping cart
Design & Modern storefront promotions
planning architecture Checkout
Website catalog
Architecture Commerce platform browse UI
and building API
blocks
New online selling
Selection of channels
PBCs Customer support
Advanced search application
engine
Order Management
Rating & Review System
System Customer identity
Product Information provider
User activity tracking Management
Content Management and analytics Payments, gift cards,
System Inventory Management etc.
Post MVP
Recommendations advanced
Storefront SaaS engine ERP Tax calculations features
Modernization roadmap

Example migration blueprint

Based on our extensive e-commerce modernization expertise, and our partnerships with best-in-class
e-commerce solution vendors, a typical ATG migration blueprint can look something like this:
Web storefront Platform Oracle DB
Client applications Business Control

Customer Experience
Support Center Manager  
Center (BCC)
(CSC) (Endeca XM)
Web storefront Mobile
External 
Microsites applications clients
Corporate systems
Services
Back-end for front-end apps
Custom
Custom
Custom
services services services
Event-driven integration and data exchange layer
Event 
Connectors ESB
stream
Commerce platform Product information management

Corporate systems
Fulfillment  Warehouse 
ERP
system Management
Digital assets management Content management
Customer
Sales audit Financials
Management
Search & recommendations Order management
ATG MACH migration blueprint

The elements of a best-in-class composable

digital experience platform
There are a number of elements that work together to provide seamlessly compelling customer
experiences that drive conversions, leverage up-sells and cross-sells, and grow customer retention.
Each of these elements can be added independently as PBCs to a composable commerce platform.
Below we highlight the optimum mix of capabilities for industry-disrupting customer experience.
Element #1: AI-powered search and recommendations 16
Element #2: Headless CMS 23
Element #3: Headless commerce platform 26
Element #4: Pricing and promotion 29
Element #5: Inventory visibility and order management 31
Element #6: Loyalty 33

Element #1 AI-powered search and recommendations
The emergence of revolutionary new
approaches to producing personalized and
context-driven search for retail based on
semantic vectors, smart autosuggest and
visual similarity and recommendation vector search
models are empowering retailers to
differentiate customer experience by
making it easier for customers to find
products they need and love.

visual search smart
autosuggest
Semantic vector search
Harnessing the power of natural language
processing (NLP) and customer behavior product
data analysis using a deep learning recommendations
similarity model, semantic vector search
captures the latent features of queries and
products and represents them as semantic
vectors (arrays of numbers representing as out-of-vocabulary natural language queries,
product or query) which form a thematic and subjective queries, and also directly
multidimensional vector space.

addresses the central problems of polysemy and
synonymy.
Semantically similar products and queries
are clustered together in the vector space,
where nearest neighbors are ranked as the
most relevant matches - in much the same

Thematic or subjective queries
way as products are categorized and
Based on rich and detailed catalog data, semantic
organized on shelves and aisles in a retail
vector search can directly tackle thematic
store.
searches, when customers are vaguely or
subjectively referring to a particular class of

How semantic vector search improves
products, such as “chic dress” or “luxurious
the relevance of search results
”
watch . Symptom searches, when customers are
referring to a problem rather than a product that

By mapping concepts that are similar in
solves it, can also be easily supported by
meaning to be close in terms of vector
semantic vector search based on analysis of
distance, semantic vector search is primed
customer shopping history.
for making sense of long-tail queries such

Polysemy Synonymy
Polysemy means that the same word may Synonymy means that the same concept can be
represent different concepts, like the represented in many ways by different words, like
word “table” in “table game” vs “accent “Big Apple”, “NYC” and “New York” which all refer
table”. When it comes to polysemic to the same city. Semantic vector models support
queries, semantic vector search easily basic synonymy with the help of NLP models
resolves ambiguity of alternative which are pre-trained on a large volume of e-
meanings based on customer behavior. commerce data. On top of that, terms used by
customers can be associated with relevant
products when the semantic search model is
trained on customer engagement data.
Semantic vector search model
Semantic vector search is truly the next major step in the never-ending quest to provide relevant,
timely and personalized search results that match customer shopping intents.
Learn more about it here: Semantic vector search: the new frontier in product discovery

Visual search represents or “embeds” images with “fingerprints”

(vectors) that capture the most essential features of
Hard to describe it? No problem! Let your
an image. Those fingerprint vectors are created in
customers just point and shoot the things
such a way that similar images have similar
they like with their mobile phone camera to
fingerprints and are geometrically clustered together.
instantly find them in your catalog, along
This embedding trick allows the search engine to
with products of a similar style and design.
quickly find similar images by their vector

Like semantic vector search, visual search representation.
Visual search model
Interested in visual search?
Read this case study where we helped the world's largest retailer of tableware, silver and estate
jewelry, Replacements.com, build a visual search solution for identifying unique patterns on
dinnerware. With a catalog of over 11 million products, from china and silver to crystal and
collectibles, the new visual search implementation reduced product search times from days to
seconds: Visual search for the world’s largest dinnerware retailer

Recommendations Smart autosuggest

Sometimes the right dress doesn’t come in Smart autosuggest is an essential feature for
the right size, or the otherwise perfect improving online catalog navigation and boosting
armchair isn’t the right shade of gray to product discovery for users. This is especially true for
complement your lounge suite. In situations mobile search, where the smaller screen and
like this, a personalized recommendations keyboard limit the use of more traditional faceted
engine can provide customers with relevant, search selectors. Smart autosuggest, also known as
personalized product recommendations autocomplete, does more than merely forcecast
that are similar to the product they are words or phrases the user is typing. Smart
searching for with respect to fashion or autocomplete goes a step further, and anticipates
style, and based on historical or real-time the user’s intentions in order to make helpful
shopping and browsing behavior. This gives suggestions. These suggestions improve the user’s
customers the opportunity to explore and search experience, increasing both online conversion
compare similar products and see products rates and average online cart value.
in colors or styles they have previously

Relevant suggestions not only reduce typing time,
looked at, and even enables them to search
but also help customers formulate longer, more
for “dress with similar hem” or “a vase with
detailed queries for the product search engine,
similar pattern” to focus on product-specific
leading to more relevant results and better
features.
conversion rates. On top of that, good suggestions
can inspire the customer to further explore the
Want to know how recommendations can catalog, resulting in additional sales.
improve customer search experience and

What to expect from smart suggestions?
conversions?
Read our case study on product

recommendations based on real-time Multisourcing
user intent: Personalized session-based
recommendations for a fortune 500 A modern suggestion generation system should
retailer be able to tap into all available data sources
including: catalog data, customer search logs and
customer behavior signals.
Signal-based ranking
An autocomplete system should be able to blend

customer's signals, like concept popularity and
trendiness, with business signals, such as
conversion rates associated with particular
suggestions.

Personalization
Suggestions should take into account

geolocation, customer preferences and
session history.
Merchandising
Merchandisers should be able to affect

suggestion ranking by promoting
particular concepts, or blacklisting
undesirable suggestions.
Match explain
The suggestion matching engine should

provide a match explanation so that it is
possible to highlight differences between
suggestions.
Interested to learn more about the

benefits and capabilities of smart
autosuggest?
Read our guide: Smart autocomplete

best practices: improve search relevance
and sales

Grid Dynamics | Digital
In search
commerce
of personalization
modernization
Best-in-class AI-powered
ptimized results ranking that leverages user
search solution vendors
O
interaction and advanced ranking models which

can be optimized for specific business goals,
Established search products, such as
such as engagement or convergence.
Lucidworks and emerging products such as
Google Cloud Retail Search and Algolia are
the top vendors for best-in-class retail
State-of-the-art security and privacy practices
search and recommendations.
that ensure retailer data is protected with
strong access controls and is only used to
Google Cloud Retail Search deliver relevant search results on their
properties.
Google Cloud Retail Search enables
retailers to provide Google-quality search
for their own e-commerce applications, The solution is also bundled into the Discovery suite
helping increase conversions and reduce with sophisticated tools to deliver highly
search abandonment. It combines state-of- personalized product recommendations at scale
the-art natural language processing and across channels, and help shoppers easily search for
relevance models with a vast Google products with an image on their mobile device:
knowledge graph to truly understand both
Recommendations AI can understand nuances
customer queries and product data. It
behind customer behavior, context, and SKUs in
empowers digital retailers to provide best-
order to drive engagement across channels
in-class, personalized search experiences
through relevant recommendations
by seamlessly and conveniently connecting
customers with products they want, need V ision Product Search uses M L-powered object
and love.
recognition and lookup to provide real-time
results of similar or complementary items from
Google Cloud Retail Search enables
your product catalog.
retailers to enhance search experience
within their e-commerce ecosystems with a
B ecause Google Cloud Retail Search shares a
variety of advanced features, including:
technical foundation with Recommendations AI, they
also largely share data ingestion pipelines which
Advanced query understanding to simplifies integration and data management across
provide better search results from search and recommendations.
broad and ambiguous queries,

including queries unrelated to the Check out our Google Cloud Discovery Solutions
product. Starter Kit that simplifies and accelerates the
integration of Google Cloud Retail Search,
Recommendations AI and Vision AI for forward-
Semantic search allows customers to thinking retailers.
find more personalized, meaningful, W e take it a step further with our Google Cloud
and relevant search results by Discovery Solutions Starter Kit for commercetools
analyzing the context of queries and that helps achieve the smoothest and fastest
customer preferences. upgrade of search experience across all channels,
integrated with your commercetools platform.

Lucidworks
Smart Answers uses advanced retrieval
Following the mantra “If they can’t find it, techniques and machine reading
they can’t buy it”, Lucidworks uses comprehension to provide substantive answers
advanced search techniques and deep instead of just document links, which greatly
learning relevance models to provide helps in powering chatbots and supporting
personalized and relevant product associates.
discovery capabilities.
Lucidworks provides a fully fledged search

and ML Fusion platform that enables Check out our Lucidworks integration solutions to
companies to build the most sophisticated ensure you see maximum ROI from Lucidworks’
product discovery solutions with a high applications.
degree of customization. In practical
implementations, semantic vector search
shows very good results in combination
Algolia
with semantic query parsing which acts as a
set of “precision guardrails” for vector Algolia approaches search from a developer-friendly
search.
and usability perspective, offering easy-to-use APIs
which encapsulate powerful retrieval and machine
The platform provides a number of valuable
learning algorithms.
building blocks which can be assembled

into a powerful query pipeline. Algolia provides search, recommendation and
answers APIs that help to provide a full suite of
product discovery services.
Predictive Merchandiser provides

low-code capabilities for achieving Democratized APIs, simple deployment and
powerful results curation, business scalability, front-end libraries, high performance and
rules and layout management. comprehensive merchandising features make it
popular for companies that do not require extensive
customizations and are looking for time-to-market
as a leading success factor.
Learning to rank allows to clickstream
and search history ingestion to
analyze customer behavior and See how we helped selfologi, a digital
optimize and personalize product marketplace for cosmetic treatments, build a
ranking. commerce platform leveraging composable
commerce MACH architecture, with Algolia for
amazing search experiences: selfologi case study
NeverNull employs dense vector

retrieval to detect low-performing
queries and pair them with high-
scoring results to eliminate zero
result searches.

Element #2 Headless CMS
A headless CMS is a content management system that manages and organizes content and UI assets
with a decoupled frontend or display layer. Through the use of an API, content can be distributed
anywhere and everywhere you need it - your website, your mobile app, your email marketing, your
CRM, etc. This makes omnichannel strategies a breeze, and change management a walk in the park.
Content managers no longer need IT support for backend changes, and can make frontend changes to
support omnichannel customer experience and campaign/promotion demands on the fly.
Headless CMS Traditional CMS
Custom frontend Singular design
API
Frontend template & CSS
Backend & Data Backend & Data
Content Content
CMS CMS
* the backend and frontend are separated, * the backend and frontend are connected,
each platform and device can be customized platforms and devices can't be customized
in the frontend in the frontend

Best-in-class headless Contentful

CMS vendors Contentful is an API-first content management
platform, purpose-built for creating omnichannel
We work with leading headless CMS vendors digital experiences. The content platform helps
who offer API-first solutions that are easily digital teams to innovate, iterate and go to market
integrated into a headless commerce faster with an agile, modern tech stack. Contentful
platform. Among them are Contentstack, features include:
Contentful, Sitecore and Amplience.
Contentstack RESTful API
Contentstack’s API-first headless CMS Contentful’s stateless API with compact JSON
makes it easy to integrate your preferred payloads gives you full programmatic control over
business and marketing technologies to your content management system, including
meet your customer experience needs. assets, translations and other versions.
Contentstack features include:
Ease of use Microservices architecture
Rapid onboarding in less than 30 Manage your structured content with fully
minutes. decoupled write and read APIs. Ensure a fault-
tolerant content platform that evolves with your
business needs and new apps.
Branches
Simplify and accelerate A/B testing and Optimized for speed

in-market experiments.
Advanced caching techniques integrate with
external CDNs to deliver API payloads in the
Workflows sub-100 ms range. Plus, support for AVIF image
formats reduces page load times to improve
Streamline creation, review, approval, customer retention.
and publication.
Live previews Language and framework agnostic
SDKs for the most popular languages and open

Preview content changes side-by-side in
source components for apps, design systems and
real time.
web editor interface.

Amplience Sitecore
Amplience dramatically simplifies how Sitecore creates human connections between brands
clients plan, create, manage, and deliver and their customers with rich end-to-end content,
content. With a modern API-first approach, seamless commerce, and always-on personalization
the Amplience solution can unleash the so brands can thrive in a world where, without a
creativity and productivity of content and digital experience, there is no product. Sitecore
technology teams. Amplience serves more features include:
than 200 of the world’s leading businesses
including Crate and Barrel, Heritage Parts,
Boohoo, Mulberry, BMC, and TUMI. Track online or offline, anywhere
Amplience features include:
Comprehensive behavioral tracking retains online
and offline customer data across all devices.
Scalable. Flexible. And Fast.
Designed as the bedrock of your future Personalize everywhere

commerce architecture, Amplience is
built entirely from the ground up as a Sitecore’s API supports delivery of dynamic
headless solution. Leverage content, meaning you can deliver personalized
microservices and RESTful delivery APIs content to almost any device or browser.
to provide content as data so you get
flexible presentation on all devices.
Engage effortlessly
Unlimited potential
Leverage Sitecore’s form capabilities to engage
with your customer when and where they want.
Amplience is a true cloud-native, multi-
tenanted service. All product releases are
delivered seamlessly every week, which
means the tools and APIs your team uses Aggregate and improve
get better every month. Feature releases
come directly from user research and Continually improve your CX by testing numerous
feedback, ensuring feature scenarios and aggregating data from anywhere
developments fully serve your key into Sitecore xDB.
priorities.
Always-on content
Amplience promises 99.99% delivery

performance and speed at huge scale.
Their server infrastructure is
purposefully built to serve high volume
peak periods. And it’s always on.

Element #3 Headless commerce platform
A core commerce engine with a headless

architecture, where the frontend and Customization
backend of the platform are decoupled,
effectively separating the content A headless solution gives you the freedom to
presentation layer and the business logic/ customize the look and feel of your brand’s UX
functional layer, enables the rapid and (user experience) on the frontend without the
seamless delivery of differentiated rigid confines that a monolith CMS solution would
customer experiences. A headless prescribe. This gives you the power to own your
commerce platform acts as the core brand and differentiate from competitors.
commerce engine that enables integration
of multiple business capabilities on a single
platform, and typically includes cart and
checkout functionalities as part of the Experimentation
solution.
Conduct UX experiments and A/B testing at will

The benefits of headless commerce are on the frontend without impacting or disrupting
immediately tangible and compelling: backend operations - something that would
require frontend and backend code changes on a
monolith CMS. This means that content managers
depend less on IT/development and focus more
on innovation.
Scalability
The frontend and backend can be scaled

independently so even if the frontend
experiences major traffic spikes, none of the
commerce functions will be disrupted. This level
of efficiency enables a faster time to value for you
and your customers.

Best-in-class headless
Speed and agility
commerce platform vendors
Because you’re working in a decoupled
environment, UX changes can be We work with leading headless commerce vendors to
implemented at the speed of light since deliver cutting-edge digital experiences. Among
nothing needs to change in the backend them are commercetools and Broadleaf.
to support the frontend change. This

empowers retailers to quickly respond to commercetools
customer demands, and launch new
campaigns effortlessly. commercetools is a notable headless commerce
contender for having actually coined the phrase
“headless commerce”, and for being the strongest
MACH ambassador among headless commerce
Extendability
providers. commercetools also has built-in
functionality for PIM, Cart and Checkout, making it a
Because multiple frontends can connect versatile and robust commerce foundation.
to one API and underlying system, you commercetools features include:
can quickly and easily add new
touchpoints on the buying journey, such
as social channels, mobile apps or
Outpace your competitors with headless
marketplaces, without having to build a
commerce
business case for a new backend every
time you want to add a new frontend.
With the commercetools headless commerce
This gives you an accelerated edge over
approach, you can modify any element of the
the competition.
shopping experience separately, so you're always
ahead of what the consumer wants. Design the
ideal customer experience by selecting the best
vendors for your business
Boost speed-to-market
With commercetools you can run A/B tests or

launch voice and AI experiments in days, optimize
the customer journey in an hour, release a new
promotion in a day or add a new channel in a
week. What’s more, your TCO running costs will
decrease significantly right from the start.

Broadleaf
Control where it matters most
Broadleaf is a flexible headless commerce solution
that has already earned the trust of leading brands
The commercetools Merchant Center
like O'Reilly Auto Parts, Major League Baseball, ICON
helps you quickly manage your most
Fitness, and Telefonica. Broadleaf offers superior
critical data and processes while keeping
functionality and countless customizations, enabling
up with changing market conditions. The
you to create experiences across any channel with
advanced PIM is already built in natively,
thousands of API endpoints. Broadleaf features
so no installation or integration is
include:
required.
Integrate anything
With our composable commerce starter
kit for commercetools, we help you build Develop at your speed by extending or adding to
a digital commerce solution, following thousands of established RESTful APIs. Use
the composable commerce MACH Broadleaf’s composable commerce feature sets
approach, with best-in-class technology, with the freedom of using other technologies
to maximize ROI, grow at scale, change at where you want.
will, and compose unforgettable
shopping experiences as fast as you
need for any channel.
Keep what’s built or build your own
Customize, integrate, and change components,

API endpoints, and your back office Admin with
Broadleaf Microservices. Secure the ability to
innovate at your own pace, now and in the future.
Deploy microservices individually or

together
Balance cost and performance by launching

Broadleaf microservices grouped or separately.
Manage your own hardware spend, scalability,
and control over sensitive data.

Element #4 Pricing and promotion
Data and analytics are transforming the art To ensure optimal promotion success, you can also
and science of customer experience. This is generate and analyze millions of promotional
particularly true when it comes to dynamic scenarios and identify the options with the best
pricing and promotion optimization. performance.
Leveraging the latest achievements in
reinforcement learning with real-time data
Price optimization
from customers, products and external
sources, retailers are empowered to Pricing analytics, economic modeling and machine
optimize pricing, promotion and loyalty learning can significantly improve the quality of
incentives from a single source of truth. pricing decisions. Considering that different market
How does it work? segments and product groups require different
pricing strategies, a data-driven solution can help
you choose between strategies such as high-low
Promotion optimization
pricing and everyday low price at any level of
AI-powered promotion optimization granularity. Combining data science with specialized
components dynamically personalize offers economic models, a pricing optimization solution
and promotions, and automatically analyzes and augments various elements of the
determine the optimal audience, price waterfall for different categories of products,
communication time, communication including replenishable or seasonal goods, and
channel, and other parameters, based on accounts for a range of complex effects such as
customer intelligence data like customer demand cannibalization, price perception, and
profile, current web session, channel, and inventory constraints.
other behavioral signals. Real-time offer

Big Data and statistical analysis can also provide
optimization based on price sensitivity and
surprisingly deep insights into what your
cart abandonment propensity greatly helps
competitors are doing and what works well for them
to improve conversion rates.
and what does not. By collecting and matching retail

AI promotion algorithms can also help you data about prices, discounts, and product
implement relevant promotion strategies for availability across the market, you can measure the
different times of the year based on effectiveness of competitors’ actions.
seasonal events, holidays, public events,
social network trends, weather, previous
campaign success, competitor campaigns,
customer preference patterns, and so on, to
keep customers continuously engaged and
loyal to your brand.

External signals Internal data Business objectives

Pricing for basic/ Competitor prices
Sales data
Revenue
replenishable items Public events
Inventory
Pricing policy
goals
Regular prices
and rules Profit goals
Socila networks
Promotions
Markdowns
Weather and Marketing activity
Stock level
Cross elasticity, halo, price calendar goals
Product attributes
perception
Pricing for seasonal items Profit model

Date and time  Dimensions
Introductory pricing
Profit Product properties
Internal 
Regular pricing
Signals
Past sales 
Markdowns Profit = Past promotions
External  
Weather  Signals
Public events
Variables to 
Dynamic pricing and  Time be opimized
Markups 
e-commerce Markdowns
Sales events planning
Flash sales optimization
Optimized promotion Regular prices Assortment and promotion
Price segmentation calendars opportunities

and personalization
Offer/promotion targeting
Pricing and promotion optimization platform
Read more about pricing and promotion optimization:

Retail price modeling for replenishable and seasonal product
A guide to dynamic pricing algorithm
Predictive analytics for promotion and price optimization
Best-in-class pricing and manufacturing, and CPG customers. It leverages the

promotion optimization solution state-of-the-art AutoML forecasting model from
Vertex AI Forecast and shows how to find optimal
vendors price points for every product to take the guesswork
out of pricing and promotion decisions and maximize
Google Cloud and Grid Dynamics teamed up
profit.
to develop a reference price optimization
pipeline in Vertex AI, Google Cloud’s data
science platform. This starter kit is built Read more about the pricing optimization
upon best practices developed by Grid solution here: Price optimization notebook for
Dynamics from multiple real-world price apparel retail using Google Vertex AI
optimization projects with leading retail,

Element #5 Inventory visibility and order management
Just as important as finding relevant To ensure optimal promotion success, you can also
products through search is receiving generate andreliable
Providing analyzeestimated
millions ofdelivery
promotional
dates
detailed information about the availability scenarios and identify
and exposing theway
it all the options with the
to product best
search.
of and order fulfillment options for those performance.
products. Rapid omnichannel commerce
expansion and ever-growing customer
expectations for fast and reliable delivery Achieving tight integration with product
require robust inventory management search, making both digital and in-store-only
systems.
products fully discoverable, allowing multiple
nearby stores to be selected and products to
Modern, lightweight API-driven composable be discovered with respect to BOPIS and in-
inventory management systems enable store availability, and making estimated
granular selection and integration of best- delivery dates available as filters.
in-class solutions for each of the inventory
management processes.
Leading retailers and brands are leveraging

Read more about omnichannel product discovery
best-in-class inventory visibility and order
and how we built an omnichannel inventory
management systems for:
solution for a major retailer: Building an  
e-commerce omnichannel inventory solution with
Distributed inventory management open-source.
with a single view on stock, and near You can also get more insights on why inventory
real-time inventory views across visibility is integral to search experience here:
channels and geographies. Why e-commerce search engines must be aware
of inventory.
Inventory management optimization

with the use of AI, including demand
prediction, safety stock optimization
and order sourcing optimization.
Supporting inbound and dropship

inventory.

Best-in-class order
Increase inventory accuracy
management solution
vendors Get a near real-time, always accurate, single view
of inventory powered by an orchestration engine.
Retailers are building cutting-edge
solutions with cloud-native open source
tools or integrating emerging headless Fulfill omnichannel demand profitably
cloud OMS platforms like Fluent Commerce.
Use the Fulfillment Optimization tool to source
from the best location every time.
Fluent Commerce
Fluent Commerce is the cloud-native order
and inventory management platform that Show accurate stock in all sales channels
enables you to completely customize your
business processes. The Fluent Order Show customers what they can buy and when
Management solution offers distributed they can get it to build customer trust.
order management with the following
features:
Enable self-service from any channel
Fast deployment Let customers see detailed order status, edit

orders, and manage returns.
Fluent’s strong out-of-the-box features
and flexible API architecture let you roll
out quickly for a faster return on Automatically process customer responses
investment. to notifications
Use customer responses to mobile notifications,

Flexible cloud platform
such as ‘Accept Updated Delivery Date’ or ‘Cancel
my Order’ to trigger fulfillment processes.
Benefit from a cloud platform that you
can fully customize to fit your
omnichannel strategy, and can keep the
processes that make you unique.
Cloud-native scalability
Fluent is built for the cloud, so you can

scale as needed anywhere around the
globe and be confident in your ability to
handle growth.

Element #6 Loyalty
With 4 out of 5 consumers stating a at any point on a customer’s shopping journey.

preference for brands that offer a loyalty
program, it makes sense to implement an Best-in-class loyalty platform vendors
omnichannel loyalty platform that offers the
Grid Dynamics has built robust in-house loyalty
flexibility to incentivize and reward
programs for some of the largest retailers in the US,
customers for a range of activities beyond
including American Eagle Outfitters, to enhance
simply placing orders. A best-of-breed
customer experience and improve customer
loyalty program that is tightly integrated
retention.
with the analytics component of your

composable commerce ecosystem enables We build omnichannel loyalty platforms with the
engagement and bespoke loyalty incentives following principles in mind:
Customer Channel Engagement
While traditional retailers Modern loyalty platforms Omnichannel engagement

may have only one type of should support engagement requires a seamless
customer, companies with options other than just customer experience across
mixed B2B and B2C business placing orders. These options digital and offline channels
models may need to support may include reacting to including web,
other customer profiles such campaigns, inviting friends, conversational, chatbots,
as office buyers or sharing on social media, mobile apps, stores,
distribution companies. writing reviews, and buying branches, and customer
for companies. support agents.
Points Rewards & tiers
Correct calculation of points While some companies may stick

and rewards is crucial for the with a basic tier and reward
best customer experience. At structure, others may want to
the same time, companies rethink it completely. An example
should be protected from of this functionality may be
loyalty fraud via the accurate joining points and rewards into
calculation of rewards. virtual “dollars” that customers
can spend on future purchases.

G rid Dynamics | Digital commerce modernization
We focus on making the loyalty experience

Read more about omnichannel loyalty platforms:
reflect the specifics of each company,
relying on composable commerce and Reward Loyal Customers: Comprehensive
unified commerce design principles. Guide to Loyalty Program
Microservices architecture and bespoke Designing Point Based Loyalty Programs That
functionality enable efficient integration, Wor
high data quality, and real-time business
How-to Guide: Building a Modern Customer
intelligence and reporting, while the cloud
Loyalty Engine
deployment model facilitates high speed to
market, scalability, and cost-efficiency.
Talon.One
Complete control
Talon.One is an all-in-one promotion engine
that is API-first, flexible, scalable, and Track every customer interaction from one
supports a multitude of loyalty incentives centralized system and deliver data-driven
and rewards, including coupons, discounts, promotions.
referrals, bundling, geofencing, wallets and
gift cards. Already serving customers like
Mercedes Benz, Adidas, Reebok and
Ticketmaster, Talon.One boasts the Developer free
following features:
Create complex promotions without stressing any
technical resources with Talon.One's intuitive Rule
A utomated agility Builder.
Free up bottlenecks across marketing

and development, enable your teams to
focus on what they do best, and get
Unlimited flexibility
best-in-class promotion features,
Adjust & scale a host of promotion campaign
budgeting and measurement.
features on-the-fly and make last-minute changes
by yourself.
Omnichannel promotion strategy
With one integration, any touchpoint a

customer has with your brand can be
turned into a promotional or loyalty
hook — giving you the tools to turn your
ideal customers into your strongest
evangelists.

Ready to start your

digital commerce
modernization
journey?
Experience personalization is critical for retailers in
the digital age, but monolithic e-commerce systems
simply don’t have the advanced capabilities,
scalability or flexibility needed to augment every
step on the buying journey to meet the rapidly
changing demands of today’s digital consumers. With
the technological advancements of composable
commerce and MACH architecture, however, you have
the freedom to weave a commerce solution together
that has best-in-class components for each area of
business, at your own pace.
The elements of a great customer experience that

we’ve discussed here, including headless commerce,
search and recommendations, pricing and promotion
analytics, inventory and order management, and
loyalty are great places to focus on since they are
directly aligned to making more sales and gaining
profitable returns.
The beauty of MACH architecture is that you can start

where you need to with software components of
your choice, and while we propose a number of
competitive contenders in this whitepaper, your
needs might be quite different. Luckily, when you
work with us, the beginning of our engagement
starts with a thorough assessment of your
technology ecosystem and business goals to help
you decide on the most logical optimization journey
and the ideal software vendors. We can work with
you on any element of a composable platform with
best-in-class brands and custom build any modern
architecture suited to your business needs.
Next steps?
Get in touch with us to start a conversation about

modernizing your e-commerce systems to meet
the demands of today’s digital consumers.

About Grid Dynamics

Grid Dynamics is a global digital engineering manufacturing, finance, healthcare, and high tech
company that co-innovates with the most sectors.
respected brands in the world to solve complex

Our secret sauce? We hire the top 10% of global
problems, optimize business operations, and
engineering talent and employ our extensive
better serve customers. Driven by business
expertise in emerging technology, lean software
impact and agility, we create innovative, end-to-
development practices, a high-performance
end solutions in digital commerce, AI, data, web
product and agile delivery culture, and strategic
UI and UX, and cloud to help clients grow.
partnerships with leading technology service

Headquartered in Silicon Valley, with delivery providers like Google, Amazon, and Microsoft.
centers located throughout the globe, Grid

In 2019, Forrester named Grid Dynamics a leader
Dynamics is known for architecting revolutionary
among midsize agile development service
digital technology platforms for 7 of the 25
providers. In 2020, Grid Dynamics went public and
largest retailers in the US and 3 of the 10 largest
is trading on the NASDAQ under the GDYN ticker.
consumer goods companies in the world, as well
as leading brands in the digital commerce,
The Forrester wave™
Midsize Agile Development Service

Providers Q2 2019
Stronger strategy

About Grid Dynamics

Key facts
12 countries across North America and Europ
4,000 employees in Q2 202
Forrester Leader Midsize Agile Software 
Development Service Provider Q2 2019
Areas of expertise
Experience engineering
Web UI Mobile UX AR/VR
Data Science and AI

Search Personalization Supply chain IoT
Platform engineering
Microservices MACH Composable
Data engineering
Big data Streaming MLOps
Cloud and DevOps

CICD AIOps SRE QE
Clients

trusted engineering partner for digital transformation
Grid Dynamics Holdings, Inc.
5000 Executive Parkway,
Suite 520 / San Ramon, CA
650-523-5000
www.griddynamics.com

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Grid Dynamics Whitepaper

Why do retailers need to modernize their monolith 4

Reimagining customer experience differentiation 7

What are the benefits of composable commerce and 9

A phased modernization approach to achieve 12

The elements of a best-in-class composable digital 15

Ready to start your digital commerce modernization 35

About Grid Dynamics 36

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 2

In this whitepaper, we provide an outline of a

Introduction Along the way you’ll learn:

Why monolith e-commerce solutions are no

There’s no denying that things have

How can retailers adapt as quickly and

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 3

Why do brands need to

While these monolith solutions once fulfilled the

Monolithic apps are rigid in terms of responsiveness

Consider these statistics from McKinsey’s

in 2021 and 15.2% in 2019. While experts say the

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 5

pandemic accelerated the shift to online

The infiltration of technology into

Not only are more consumers shopping

That said, it’s no longer enough to apply a

Enter composable commerce and MACH

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 6

Reimagining customer experience

Composable commerce and MACH represent In such an architecture, it is common to have

Composable commerce blueprint

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 7

The MACH approach to composable commerce

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 8

What are the benefits

From a customer experience perspective,

The Headless architecture decouples the UI from the

Grouping microservices into packaged business

At the same time, an API-first approach greatly

Businesses that adopt a composable commerce

Other MACH opportunities:

By default, MACH architecture is event- Analytics can be streamed in real time,

An event stream is a constant flow of events

Besides configuring the communication flow

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 10

With a single event stream integration that connects

With an Event Stream

Without event streaming, the data movement

Without Event Stream

Copyright © 2022 Grid Dynamics Holdings, Inc. All rights reserved. 11

A phased modernization approach to achieve

competitive customer experience

moving certain functionality to candidates are usually also:

microservices according to business

priorities. It is clear that customer

critical business component for any and

changes due to functional or

In light of this, a winning modernization performance requirements.

strategy should start with migrating non-

transactional components like the content

Other MACH opportunities:  