Technological advancement is often seen as the bedrock upon which modern commerce builds its rapid growth, but what happens when this foundation is composed of outdated technology? A revealing study, the 2025 Digital Commerce Landscape Report, created by Elastic Path with Vanson Bourne, sheds light on current technological challenges faced by ecommerce businesses. The report underscores how reliance on legacy systems dramatically hinders performance and competitiveness, which is crucial in a market that evolves at lightning speed.
Technological Stagnation and Its Impact
Scalability and Cybersecurity Challenges
The research indicates that 93% of organizations acknowledge their current technology limits their ecommerce success, with a striking 72% agreeing that legacy systems hold them back significantly. This means businesses are unable to scale effectively during high-demand periods, which are often critical for maximizing revenue streams.
Additionally, outdated technology opens the door to increased cybersecurity vulnerabilities. With cyber threats becoming more sophisticated every day, maintaining robust security is paramount. Companies using antiquated systems often find themselves ill-equipped to fend off cyber attacks, putting both company and customer data at risk. This substantially impacts consumer trust, a vital component in retaining and expanding a customer base.
Missed Revenue Opportunities
The constraints imposed by outdated technology do not only affect scalability and security but also lead to missed revenue potentials. Limitations inherent in legacy systems frequently prevent businesses from deploying innovative sales and marketing strategies that could capture additional market share. For instance, leveraging data analytics to predict trends and optimize inventory is often difficult when hampered by old, inflexible technology.
Furthermore, the agility required to adapt to changing market conditions is severely curtailed. Rapid response to emerging consumer behaviors and preferences is integral to capitalizing on new opportunities, something that legacy systems are seldom designed to handle efficiently. This can result in missed chances for growth and expansion, further jeopardizing an organization’s market position.
Customer Retention Issues
Struggles with Retention Abilities
Customer retention is another casualty of technological stagnation, with 56% of surveyed organizations expressing dissatisfaction with their ability to retain customers using their current storefront technology. Retaining customers is increasingly important as acquiring new ones becomes costlier and more challenging.
In fact, maintaining customer loyalty is a struggle for 49% of the organizations surveyed. In an ecommerce landscape where consumers are constantly bombarded with new options, the ability to keep them coming back is critical for sustained success. Inefficient technology solutions offer limited capabilities in personalizing experiences and engaging customers, leading to erosion in customer loyalty.
The Shift Toward Retention Strategies and Programs
Acknowledging the high costs associated with attracting new customers, 31% of organizations are now prioritizing retention strategies. This shift demonstrates a growing recognition of the need to enhance existing customer relationships. Retention strategies can include personalized marketing, improved customer service, and exclusive offers that incentivize repeat business.
Moreover, 38% of organizations are investing in loyalty programs aimed at maintaining a strong customer base. These programs often entail rewards, points systems, and special promotions—initiatives that can help solidify a company’s relationship with its customers. However, the effectiveness of these loyalty programs is largely dependent on the underlying technology used to implement and manage them efficiently.
Integration and Development Challenges
Complex Integration Issues
Integration of existing systems with third-party applications poses a significant hurdle for 51% of organizations. This issue stems from the rigidity and incompatibility of legacy systems with modern technologies. Seamless integration is essential for creating a cohesive ecommerce ecosystem that can streamline operations and enhance the customer experience.
Furthermore, 52% of organizations face difficulties in creating and managing APIs. APIs are critical for enabling different software applications to communicate with each other, and challenges in this area can result in fragmented systems that operate inefficiently. Another related issue is the integration of commerce platforms with external technologies, with 43% of respondents reporting difficulties in this area.
The Burden of Custom Development
Given the rigid structures of some legacy IT systems, custom development often becomes a necessity for organizations attempting to modernize their operations. This process is time-consuming and labor-intensive, as evidenced by 32% of respondents who report the significant effort required to develop custom solutions. Such endeavors can strain already limited resources, diverting attention and funding from other strategic initiatives.
The need for custom development also highlights the inflexibility of outdated systems. Modern e-commerce requires adaptable and modular solutions that can evolve in response to changing market conditions. The inability to swiftly implement new functionalities or integrate with emerging technologies puts companies at a competitive disadvantage.
The Role of Artificial Intelligence
Pressure to Adopt Emerging Technologies
Artificial Intelligence (AI) has emerged as a pivotal tool for staying competitive in the ever-evolving ecommerce landscape. According to the report, 45% of organizations feel under pressure to adopt AI and other emerging technologies to maintain a competitive edge. The rapid advancements in AI demand continual upgrades and integration into business strategies and operations.
A notable 86% of survey respondents expressed concern that their companies would fall behind without integrating AI into their strategies. AI can drive significant improvements in efficiency, personalization, and overall customer experience. However, adopting AI requires not just technological investment but also a shift in organizational mindset and culture, which can be challenging for companies entrenched in legacy systems.
AI Applications in Ecommerce
The applications of AI in ecommerce are diverse and transformative. For example, 50% of the organizations utilize AI to enhance SEO and content creation. AI algorithms can analyze vast amounts of data to improve search engine rankings and generate relevant content that attracts and retains customers.
Another popular AI application is the implementation of AI-powered chatbots, used by 49% of the organizations surveyed. These chatbots provide immediate customer support, helping to resolve queries and issues more efficiently than human agents. The use of AI in these areas can improve customer satisfaction, reduce operational costs, and contribute to higher conversion rates.
Budget Constraints and Modernization Needs
Incremental Improvements Over Major Overhauls
Despite the clear need for improved digital commerce strategies, over 40% of companies are restrained by budget limitations when it comes to extensive platform overhauls. This financial constraint means that many organizations may need to focus on incremental improvements rather than major system-wide upgrades.
Doing so allows companies to gradually phase out outdated technology and integrate more advanced solutions without necessitating significant upfront investment. This approach can be pragmatic; however, it also requires careful planning and prioritization to ensure that the most impactful changes are implemented first.
The Shift to Composable Commerce
To address integration and capability challenges, the report advocates for the adoption of composable commerce, a strategy that allows businesses to assemble best-of-breed components tailored to their specific needs. Composable commerce offers the flexibility and agility required to rapidly adapt to market changes. It can facilitate the integration of new technologies, improve operational efficiency, and enhance the overall customer experience.
Organizations with revenues ranging from $25 million to $500 million, surveyed for the report, showed a strong consensus on the necessity to modernize their technology to remain competitive. By embracing composable commerce, businesses can overcome the limitations of legacy systems and position themselves for future growth and success.
A Path Forward for Ecommerce Growth
Technological advancement is often regarded as the cornerstone upon which modern commerce builds its rapid growth. However, problems arise when this foundation consists of outdated technology. The 2025 Digital Commerce Landscape Report, a comprehensive study developed by Elastic Path in collaboration with Vanson Bourne, provides insightful analysis on the technological challenges currently facing ecommerce businesses. The report highlights the critical impact of relying on legacy systems, which significantly hampers the performance and competitiveness of these companies. This is especially important in an industry that evolves at lightning speed. Relying on old technology can lead to inefficiencies, reduced customer satisfaction, and an inability to adapt to new market trends. As such, upgrading technological infrastructure is not just a recommendation but a necessity for businesses looking to thrive in today’s fast-paced digital environment. The findings call for a proactive approach to technology adoption and integration to ensure that companies stay ahead in the competitive landscape.
