Magento Enterprise and Demandware are two of the biggest names in ecommerce, enabling medium to large retailers to effectively showcase, market and sell their merchandise online. Both platforms power online stores for a number of huge brands, including:
|Missguided||House of Fraser|
|Charlotte Tilbury||Kate Spade|
These are just a few examples of larger merchants – generally, Demandware has more household names using the platform (and it’s far more focused on the enterprise retail end of the market), however Magento Enterprise has significantly more stores.
Both solutions are also very different, and if you’re considering using Magento Enterprise or Demandware, you need to be aware of their distinctions in order to make the right decision. To help you do that, I’ve put together some points of comparison between the platforms, as well as what (and how much) it would take to get them up and running.
Hosted (cloud) vs. self-hosted
The biggest distinction between Demandware and Magento from a technology standpoint lies in where each company hosts your ecommerce store and how they’re hosted.
Demandware is cloud-based and is fully hosted, which means the task of hosting its technology and services is handled by the company, and not its clients (i.e. retailers) or the systems integrator (the agency building the site). This set up is ideal for merchants who don’t want to handle server maintenance and software updates and it also means that Demandware are in a position to offer an SLA, unlike Magento.
Although this comes at a cost, there are obvious advantages to having your ecommerce store hosted by a team of experts who are focused solely on scaling the same technology day in, day out. One of the most frustrating aspects of maintaining a Magento store is the upgrades, which highlights another strength of Demandware in that these would be managed by Demandware. It can however, curb your freedom when it comes to site customisation and functionality (and generally being agile with technology changes). Since the technology is controlled by Demandware, there are some limitations on the features you can implement and there’s an approval layer, which can add a time overhead to site changes and releases.
Magento Enterprise, on the other hand, is self-hosted so you would need to setup and manage your own servers (although there are some really good hosting partners out there and most good Magento agencies are equipped to manage this too). You’ll also be responsible for updates and maintenance of the technology, so you’ll either need an in-house team to do this or commission an agency to take care of it for you. The good news is, with Magento, you have a lot more freedom and control over your store as a result of it being self-hosted.
Demandware is widely considered the more scalable of the two platforms – high profile Magento websites have been known to collapse at peaks, although this is generally due to the way the infrastructure has been built. Missguided is one of the UK’s largest Magento merchants and they were able to handle 15,000 concurrent users on Black Friday 2014 and other high profile sites do manage high load regularly (Angry Birds was another really good example). Demandware use this as a key selling point and they put a lot of time into ensuring that the platform is able to scale effectively.
Both Magento Enterprise and Demandware give you the capabilities to create highly customised, powerful online stores and both are capable of managing large inventories. But there are also some significant differences, especially when it comes to how these capabilities are offered. Here are some of the key differences in features for Magento Enterprise vs Demandware.
Demandware key features
Demandware has all the features that you would expect from an ecommerce platform that powers the likes of Adidas and House of Fraser, but one of the notable things about the solution is its focus on omnichannel retail. Under its Commerce Cloud and Demandware Commerce capabilities, the company offers retailers a tightly integrated system that enables them to seamlessly sell across multiple platforms. Some of Demandware’s most interesting key selling points include:
An integrated commerce platform – Demandware’s Commerce Cloud unifies ecommerce, order management, POS and offline store operations in one hosted solution. It enables you to do business across multiple channels (ecommerce, mobile, brick-and-mortar) from a single platform, thus streamlining operations, sales and fulfillment. This can be achieved with Magento Enterprise – but it’s likely to require development work and third party integrations (particularly with POS).
Buy anywhere, fulfill anywhere – Demandware also lets merchants implement services such as “buy anywhere, fulfill anywhere,” which gives shoppers flexible purchasing options including in-store pick up, ship from store, and more. Again, Magento Enterprise could easily achieve this, but not out of the box. It comes back to the same point that Magento is built for the masses, whereas Demandware is built for the top tier of retail.
In-store integration – Demandware has built-in tools that enable in-store associates to engage with customers on the shop floor. Using mobile devices, the in-store staff can assist customers by offering product suggestions and allowing them to view inventory beyond what’s being displayed in the shop.
Shopper intelligence and personalisation – Using predictive intelligence, Demandware gathers data and insights into shopper behavior and uses that information to help retailers personalise offers and customer experiences. Demandware integrates with your email marketing provider (ESP) so you can send tailored offers, and it also has Active Merchandising™ capabilities, which allow you to serve up tailored recommendations on your ecommerce site. Personalisation is a big plus for Demandware, however Magento can achieve the same, but with an integration with something like NOSTO or Listrak (which are specialist third party personalisation options).
Demandware Multi-store – Like Magento, Demandware allows users to manage multiple store-fronts from a single back-end, allowing for things like internationalisation, B2B and B2C trade, multiple instances, multiple storefronts etc.
Support – Demandware provide comprehensive 24/7 support for all merchants, which isn’t just limited to core code issues. This is much stronger than the Magento support, however it’s factored into the significantly higher licensing fees.
In addition to these, Demandware also offers the following:
- Flexibility around SEO – although there are still technical SEO issues with things like dynamic page handling etc (very similar to Magento)
- Demandware gives users a lot of control over redirects (rule-based and page-level)
- Lots of features around managing products (configurable products etc)
- Allows for cross-sells and up-sells
- Built-in PLP merchandising
- Customer segmentation
- Comprehensive email management (customer-facing emails)
Magento Enterprise key features
Magento Enterprise has all the features found in the Community version, but also includes advanced and exclusive capabilities such as:
Dynamic marketing and merchandising – Magento Enterprise lets merchants merchandise product list pages via Visual Merchandiser (recently built into Magento EE). It also has built-in tools like Customer Segmentation and Targeted Promotions & Merchandising, which can dynamically show content and offers based on each shopper’s address, order history and shopping cart contents.
There’s also Dynamic Rule-Based Product Relations, which can help you increase basket size by setting automated rules for up-sells, cross-sells, and products related to various customer segments. In addition, the platform has an Automated Email Marketing Reminder tool that automates sending emails to customers with abandoned shopping carts and wish lists.
Increased customer loyalty – Magento Enterprise has several features to help you show your best customers how much you value them. There’s Rewards Points, which lets you set up a loyalty program, configure rewards and more. The platform also allows you to hold exclusive shopping experiences such as private and flash sales, through its Private Sales capability.
Additionally, Magento Enterprise offers a number of tools to enhance the shopping experience. These include Store Credits, Multiple Wish Lists, Gift Registry and Gifting Options.
Magento enterprise also has a built-in product reviews platform, which can be customised to provide a very strong process – although the OOTB functionality isn’t brilliant.
Powerful performance and scalability – One of Magento’s biggest weaknesses is performance, although they do provide built-in features features like Full Page Caching, Optimized Indexing, and Support for Alternate Media Storage with Magento Enterprise, which means you can configure it to improve your store’s performance and reduce load time. Generally you would want to further optimise the platform and invest in high performance servers to achieve sub-one second load times though.
Extensive management tools – Magento Enterprise provides a number of tools to help you better manage the backend of your store.
There’s Return Management Authorization (RMA), which streamlines the returns process. The platform also lets you create multiple admin roles, so you can enable or restrict sites and functions depending on the role of each user. This feature works well with Magento’s capability to log admin actions, so you can review each administrator’s backend activities and see who performed which action and when.
Mobile – Magento Enterprise Edition comes with a Magento Mobile Software Development Kit (SDK) which allows retailers to reduce development effort when creating mobile applications. The SDK offers an API, a complete library of resources, support for key features, and fully functioning apps to make development easier.
Support – Magento Enterprise does come with support, however it’s not on the same level as the support that Demandware would provide. Magento would provide support around serious code issues etc, whereas Demandware provide full 24/7 platform support, which includes lots of training etc.
In addition to these main features, Magento Enterprise also offers the following:
- Comprehensive email management (purchase emails etc)
- Options for customer service reps to input orders through the back-end
- Built in visual merchandising
- Custom coupons
- Advanced product configuration options (lots of different product types beyond just simple and configurable)
Overall – I’d say the OOTB is fairly comparable, however Demandware is probably a little bit more enterprise-level with its marketing capabilities.
Extending the capabilities of Demandware and Magento Enterprise
The above-mentioned features should give you a better idea of what each platform has to offer. That said, just because you can’t find a feature you need with the OOTB version of the platform, it doesn’t mean you can’t make it happen. The beauty of both Magento Enterprise and Demandware is they allow you to extend their capabilities by tapping into their API or marketplace of developers, designers and partners.
For example, Magento doesn’t have some of the built-in ominchannel features that Demandware offers, however lots of larger merchants will have integrated with third-party systems or used modules to achieve the same (or better) results. As I’ve mentioned in my previous post, there are plenty of integrations and modules in the Magento marketplace that allow you to sell in brick-and-mortar stores and mobile. This is just one example – Magento is probably the most extendable ecommerce platform in the world – purely because it has so many existing integrations and modules – for me, this is where the real value is. If you were to use a non-mainstream ERP system for example – integrating with Demandware would could a huge amount of money (due to the high costs of that platform that we’ll come onto later), whereas Magento is more than likely to have an existing integration for the system.
Magento makes it really easy to find third party solutions and add-ons that work on its platform. The company has a massive community and marketplace so you have a lot of options when it comes to the experts, partners, and solution providers.
Similarly, Demandware has a good, though much smaller community. It has the LINK Marketplace, which is composed of select Demandware partners that can offer support and value-added services for your store, but it doesn’t compete in terms of modules or number of developers – which is why it doesn’t have the same amount of integrations etc.
This gives Magento a huge advantage – both in terms of cost and short-term and long-term flexibility (unless budget isn’t really a factor).
Licensing fees for Magento Enterprise start at $18,000 per year, not including the website build / development costs (agency / developers). When factored in, all these costs are likely to be closer to $100,000 / £60,000 as a minimum and probably more like $200,000 / £120,000 on average.
Demandware has a subscription fee plus the company takes a percentage from your sales. Exact numbers aren’t readily available, but according to CPC Strategy, a Demandware customer that has annual sales between $20 million and $500 million (Demandware’s target client) can expect licensing fees starting from around $200,000 and in some cases closer to $700,000 a year and an additional $250,000 to $600,000 a year for other services.
Agencies and developers
This is the second area where Magento really takes the lead – as there are hundreds of highly qualified agencies and a huge amount of certified, highly experienced developers. These people have a huge amount of experience of working on high performance Magento stores and they know the platform inside out – whereas there aren’t many Demandware agencies to choose from and they don’t have the same level of platform knowledge / experience because they work on less projects.
The fees from agencies are also incomparable from my experience – Demandware agencies seem to charge a huge premium for all types of services which would be considerably more cost effective if they were being done with Magento.
So, which solution should you choose?
The “right” decision on whether to go with Magento Enterprise or Demandware hinges on the nature of your business, your priorities and probably most importantly, your budget.
A big factor in your decision lies in the amount of freedom and customisation you need. If you don’t want to manage your own infrastructure and you’re happy with compromising control for security and almost guaranteed scalability, then Demandware is probably the better platform for you. However, if you require a lot of customisation and need complete freedom over your store as well as the add-ons and solutions that you want to work with, then Magento could be a better fit.
Pricing is also an important consideration. Magento Enterprise is a considerably more economical choice, but it requires more in-house knowledge generally, since you’ll be handling hosting, maintenance and upgrades, among other things. Demandware takes these tasks off your hands, but requires a much larger investment. Also note that Demandware takes a cut from your sales, so if you aren’t comfortable with this pricing model, you’ll want to go with another provider.
The bottom line is, it takes a huge investment (both in time and money) to set up your store or to switch platforms, so you need to have a thorough understanding of what these solutions bring to the table.
Do your research. In addition to reading commentaries such as this one, go out there and talk to merchants using both platforms. Also get in touch with the two companies. Take demos, talk to their support staff, and ask questions to determine which solution is right for your business.
Good luck, and if you need more information on choosing the right ecommerce platform, feel free to get in touch.