Key Questions for Ecommerce Platform Selection

Feb 21, 2023

SaaS, PaaS, Single Tenant & Multi Tenant Ecommerce Platforms

Selecting an ecommerce platform can be challenging, and that’s before you start facing terms like SaaS, PaaS, Single Tenant versus Multi Tenant, on premise versus cloud and more. Today we’re going to dive straight into those terms and show why some of these most overlooked terms can be the most important elements in your ecommerce platform decision.

SaaS, PaaS & On Premise Defined

SaaS stands for software as a service - meaning that in exchange for a monthly or annual ongoing payment, you will receive the services provided by a set of software, but not the software code itself. The code is kept and maintained by the ecommerce provider who also selects and provides the method by which the code and your website is hosted.

PaaS stands for platform as a service - meaning that in exchange for a monthly or annual ongoing payment, you will receive the services provided by a given platform. With a PaaS you can and often do receive the underlying software code, but the ecommerce provider selects and provides the method by which the code and your website is hosted.

On Premise is the oldest of these three terms, and refers to software that you purchase a copy of and run on your own server. This used to mean that your business would run the software on a server located in your office - i.e., on the premises of your business. Now it more typically means that you purchase the software and run it on a server you lease from a hosting provider or in the cloud via a service like Amazon Web Services. In this instance, you are responsible for selecting and controlling the method by which the code and your website is hosted.

Single Tenant & Multi Tenant

Single Tenant ecommerce platforms are dedicated exclusively to one particular business, and are customized to meet that businesses needs. This kind of platform gives the business control over their data and the freedom to customize and change the platform to suit their needs.

Multi Tenant ecommerce platforms are designed for multiple businesses and offer the same platform to all customers. This can be a very cost-effective way to build an ecommerce platform, as the same code base is used for all customers. However, because the same code is used by all customers, customers aren’t allowed to access or modify the code and have to utilize whatever code is being provided for all customers.

Why Does It Matter?

In a recent survey of ecommerce brands, Digital Commerce 360 reports that the most common reason for switching ecommerce platforms is to select a platform that provides “commerce software adapted for us and hosted externally in a single-tenant environment.” This approach has become the type of ecommerce platform that works best for the average ecommerce brand. By definition, this criteria requires either PaaS or On Premise software and a single tenant approach, which isn’t the approach provided by popular SaaS platforms BigCommerce, Shopify or even older industry players like Oracle Commerce. This means it’s very easy to accidentally select a platform that seems like the right choice only to find yourself re-platforming again 1 or 2 years later when you find the restrictions of multi-tenant SaaS platforms too limiting for your business.

What Questions Must I Ask Prospective Ecommerce Platforms?

New approaches like MACH and composable commerce are further confusing the buying process for ecommerce professionals, and some platforms try to bend the definition of SaaS or PaaS, so it’s hard to know what to ask. However, there are three simple questions that can help you understand what you’re getting into with an ecommerce platform you’re considering:

• Will I have access to view the code that powers my ecommerce site on your platform?

  • If a platform says no, you’re looking at a SaaS, and probably a multi-tenant SaaS. SaaS can be great for your blog or your marketing software, but it’s not the best choice for all but the smallest ecommerce brands.

• Will I have access to modify or add to the code that powers by ecommerce site on your platform?

  • If a platform says yes, you’re looking at either a single tenant PaaS or an on premises solution, which means you’ll be able to customize and control the user experience and integrate your new ecommerce platform into your existing systems. This is a good thing.

• Who do I call if my site is down?

  • This can help you dig into the details of PaaS solutions especially. Some PaaS-based ecommerce platforms operate their own support center and response team for site outages; others will refer you to the underlying hosting provider. If they’ve answered yes to the previous two questions and indicate that they are the company you would call if your site is down, you’ve looking at a platform that provides that sweet spot that most merchants are looking for - commerce software adapted for your brand and hosted externally in a single tenant environment.

What If I Don’t Want To Deal With All of This?

If you have a strong IT department, chances are you’ve already heard preferences about SaaS versus PaaS versus on-premise and are ready to select an ecommerce platform based on these items. But if you aren’t sure or aren’t getting strong guidance or just don’t want to deal with learning all of these acronyms - reach out to someone in the ecommerce industry you trust and outline your needs and ask them if they feel a SaaS, PaaS or on-premise ecommerce platform would best meet your needs. Armed with that knowledge you can quickly cut your ecommerce platform search down to just one or two top platforms. Not sure who to ask - feel free to contact us for a free consultation!