The pace of technological change — as well as consumers’ increasing demand for always-on-shopping, anytime, anywhere — has left some retailers struggling to innovate digitally to meet customers’ evolving wants and needs. Case in point: according to McKinsey’s 2022 Global Survey on digital strategy and investments, most brands report much lower than expected revenue increases from their digital transformations. And the findings of a 2020 Boston Consulting Group study are similar: only 30% of businesses achieve their expected performance following a digital transformation.
The MACH Alliance was formed in 2020 with the mission to educate and support companies that are transitioning from legacy, monolithic infrastructure to flexible technologies that can meet fast-changing consumer needs. “MACH” stands for the four qualities that characterize modern, adaptable technology systems: Microservices-based, API-first, Cloud-native, and Headless.
Here are three reasons why forward-thinking retailers are implementing MACH principles — and working with organizations that are doing so — to foster dynamic customer experiences that align with consumers’ changing wants and needs (and in turn, exceed revenue goals!):
1. Creating a plug-and-play infrastructure enables rapid innovation.
The customer experience is changing — and faster than ever.
Rapid advances in digital technology have already transformed the brick-and-mortar shopping trips of yesteryear into omnichannel experiences where consumers can shop from home, on the go, or in-store depending on their needs. Yet, an even more ambitious model of customer experience has emerged: an integrated channel model in which all customer interactions — in-person, online and metaverse — are managed by a single mobile application.
MACH technologies provide retailers with the flexible infrastructure required to keep pace in this ever-evolving technological landscape. Rather than being tied down by old platforms that too often hamstring innovation, retailers that fully embrace MACH architecture can choose the best solutions in the marketplace to meet changing customer demands. And they’re rewarded for it too.
In a recent McKinsey study, digital leaders in retail banking saw a 19.3% return on tangible equity (RoTE) compared to just 15.3% for those that lagged behind in their digital transformations. As technology develops ever faster, future success and failure in the marketplace will likely hinge on how well and fast retailers can implement new technological solutions. MACH helps them do it — and fast.
2. Flexibility allows for increased personalization.
Greater personalization for consumers has always been one of the primary promises of digital transformations. Perhaps it’s no surprise that one Statista study projects revenue from customer experience personalization and optimization software will reach $11.6 billion by 2026 worldwide, or roughly 65% greater than its 2020 levels. That’s extraordinary investment in precisely the kind of technology that retailers routinely struggle to use optimally: brands know personalization drives customer loyalty at potentially lower acquisition costs, but they can’t quite integrate or manage their systems to effectively get it right and hit their targets.
As a technological standard that relies on microservices, APIs, cloud-based SaaS and headless architecture that decouples a platform’s front end and back end, MACH offers an opportunity for brands to actually achieve the personalization they’ve been striving to build for years. Retail sites built on older technology typically require retailers to conduct lengthy experimentation processes like A/B testing, often leading to difficult-to-implement personalization insights. By contrast, MACH’s structure enables quick-and-easy digital integrations and off-the-cuff experimentation that can power personalization right away.
Rather than spending their time and money simply figuring out how to integrate a new tool into their complex rules-based suites, retailers can instead focus on refining their personalization efforts to finally gain a competitive advantage.
3. MACH allows cost-effective delivery of user-first digital services.
MACH also provides retailers with the opportunity to build user-first digital services that enable the kind of omnichannel experiences modern consumers expect. The coronavirus pandemic turbocharged the need for omnichannel practically overnight, turning a once cutting-edge experience into a must-have that was required to simply survive against the competition. But many retailers struggled to form a coherent omnichannel strategy and often failed to implement the most impactful technological solutions into their overall experience.
MACH architecture enables a user-first omnichannel experience by emphasizing agility and the seamless integration of tools on the backend without negatively impacting the front end. This means that brands have the ability to safely expand and experiment with the customer experience without an expensive overhaul of their established systems. In effect, retailers can fully commit to the building of truly integrated online, mobile and in-person experiences that don’t just meet customer expectations but actually exceed them.
Through implementing MACH standards, retailers have a chance to foster customer experiences that really are dynamic. Rather than representing a static suite of tools and experiences, MACH empowers retailers to actively respond to consumers and actually change with them. Whether we like it or not, that’s a dynamic that’s changing faster than ever — and it’s here to stay.
Sai Koppala is the Chief Marketing and Strategy Officer at SheerID. Prior to SheerID, Koppala led a variety of marketing and product teams at global software companies like Google and SAP as well as startups like Proximity (acquired by Apple) and Apigee (acquired by Google). Koppala is an Electrical Engineer by training, with an MBA in Marketing from Kellogg School of Management, Northwestern University.