Rafael Corrêa Gomes

Adobe Commerce: Open-source total cost of ownership

Discover why TCO may be lower with Adobe Commerce than with Magento Open Source
Adobe Commerce - The Truth about Total Cost of Ownership

The e-commerce growth these last years is amazing, although, the open-source total cost of ownership has increased incredibly too. E-commerce advanced by a decade during the first three months of 2020. In 2019, digital retail sales reached $2 billion on only two days outside the holiday season. In 2020, more than 130 days exceeded that milestone as of August, end of the year ended with the single biggest Cyber Monday in history.

One of the main advantages to have a portion of this market growth is to be capable of moving fast with quality and innovation.

When it comes to business and technical discussions, most of the tech leads won’t measure the business risks to use a custom solution or a solution that doesn’t have enterprise support. This might be one of the biggest mistakes in case support and reliability are essential to your growth. If you associate open-source to a free solution only, you’re possibly missing many points.

By not seeing the risks, doesn’t make the way safer, it makes the path risky.

Analyses made by technical architects wouldn’t consider just open-source solutions just because we like open-source or because they are free. Enterprise risk measurements involve much more than that, these below are some of them.

Keep in mind, when an agency or technology partner says to you that they can do everything in-house and you won’t have any issues, it means that you will pay 10x more to have something that already exists and is validated in the market, probably you won’t have maintenance plan or support planned. In your current or next project, make sure you cover the cost of “free and quick” solutions as part of your long-term plan, to not put too much effort and money into something that does not necessarily require it.

Possible Costs of Owneship

These are not all points, but at least it’s going to open the possibilities to you, in case you don’t evaluate them.

  • Costs of development
  • Extensions
  • Integration
  • Equipment
  • Cloud services
  • Support
  • Maintenance

Adobe Commerce vs Magento Open Source

One of the main evaluations that I perform to my clients is the open-source vs on-premise vs saas. It will define many other things in your project, so I’m bringing here some points that you might not see that make difference when selecting Adobe Commerce.

  • Product Recommendations powered by Adobe Sensei delivers automated, powered product recommendations.
  • B2B e-commerce delivers complete B2B functionality fully integrated with Adobe Commerce for multi-channel selling.
  • Customer Segmentation can display content and promotions to specific
    customers based on their location, behaviour, etc.
  • Visual Merchandiser includes advanced tools for creating product categories
    and displays.
  • Business Intelligence provides flexible commerce dashboards for monitoring all
    aspects of your e-commerce business.

For sure Open-Source is very easy and quick to set up your project, but for a medium to large scale project, you might need extra support and more native features.

Buy and create extension

There are merchants and tech leads that buy so many extensions from different vendors and allocate many developers to customize them, that the cost is higher than a Magento B2B license which would bring the features and support to new versions. To mitigate upkeep costs, you can look at the development costs.

The average of design and development costs are higher than ever:

  • Web design: $80–$100/hour
  • Web development (full stack): $140–$180 hour
  • Technical Architect: $150 – $200 hour

DYI Infrastructure costs

Many merchants go to the cheapest hosting solution, I extremely don’t recommend that to medium and large businesses. If it’s not prepared for the new countries regulations, it might give you some headaches.

If you’re not prepared for GDPR and your server received an attack that stole your data, the less severe infringements could result in a fine of up to €10 million, or 2% of the firm’s worldwide annual revenue from the preceding financial year, whichever amount is higher. You might be able to confirm it on the official GDPR website: What are the GDPR Fines?

Many small agencies will say to you that they can do the hosting and look at it when it’s needed, but nowadays it impacts more than you might think.

RequirementsMagento Open SourceAdobe Commerce
B2B commerceAdd custom development
+ maintenance
Included
CMS toolsAdd custom development
+ maintenance
Included
Product RecommendationsAdd custom development
+ maintenance
Included
Customer SegmentationAdd custom development
+ maintenance
Included
Marketing and
merchandising
Add custom development
+ maintenance
Included
Business IntelligenceAdd custom development
+ maintenance
Included
Hosting/infrastructureAdd hosting + CDN Included
Performance monitoringAdd New Relic Included
Service and supportAdd support or IT hours Included
Systems integrationAdd costs for the integration of third-party CMS and other
systems needed to replicate
the full functionality of
Adobe Commerce
Included
Design/test/implementAdd Adobe partner fees or
IT hours
Add Adobe partner fees or
IT hours
Extensions and
customizations
Add Adobe partner fees,
developer fees, or IT hours
Add Adobe partner fees,
developer fees, or IT hours

Let’s talk

If you don’t have an enterprise-ready agency taking care of your project or even if you already have, let’s talk I’m sure we can make your project became even better.

About me

Rafael Corrêa Gomes

Rafael Corrêa Gomes

Senior ecommerce developer and architect based in Montreal, Canada. With experience with saas, product and team management using Magento, Shopify, PHP, JavaScript and NodeJS.