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March 27, 2000

E-Commerce Platforms:
New Platform Options Fuel E-Commerce
E-commerce platform vendors are converging on the same space, adding new features and infrastructure capabilities to address users' demands that they stand out from the crowd. We'll put as many as 15 of these systems to the test.

By Jeetu Patel, Joe Fenner, and Lisa Matway

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here's little sign of slowdown in growth for the E-commerce market, particularly in the business-to-business sector. Forrester Research predicts that the business-to-business E-commerce market will hit $2.7 trillion by 2004. Of course, this assumes companies will continue to acquire products and services for business-to-business E-commerce.

But even as the market matures, IT groups and business managers still have their work cut out for them. We've identified about two dozen vendors that provide E-commerce platforms, with many more companies offering such platforms as application service providers.

In addition, the technology for E-commerce platforms is changing. A year or two ago, it was enough to handle online catalogs and transactions. Customers today are looking for much more, including features such as personalization and content management, specialized business-to-business capabilities, and infrastructures built for scalability and reliability. In fact, pure transaction capabilities in Web sites are rapidly becoming commoditized.

With so many choices available in the E-commerce platform market today, Doculabs and InformationWeek Labs are embarking on a comprehensive benchmark review of E-commerce platforms. These evaluations will be conducted at the Doculabs facility in Chicago, and the program is open to as many as 15 vendors. All products will be evaluated against a detailed list of criteria, using a real-world application scenario as a vehicle for exercising the full range of capabilities each offering provides.

When we completed our first evaluation of E-commerce platforms for InformationWeek Labs more than a year ago, most of the vendors were focused in their applications: They provided solutions for classic sell-side applications, procurement (buy-side) applications, or online marketplaces. Today, we're finding more vendors that offer solutions for all three application areas, and most other vendors are moving to flesh out their suites. We're also seeing an increased focus on managing customer interaction as an overall strategic initiative for E-commerce.

One of the most intriguing application areas is electronic marketplaces. Forrester Research predicts that $1.4 billion in sales will flow through online markets in 2004. But providing the full range of features that marketplaces require is no simple task. Marketplaces need specialized capabilities, including auctions, reverse auctions, bid management, and demand aggregation.

It's significant that these applications increasingly are falling under the purview of line-of-business managers and marketing departments. Most companies understand that E-business is really just business, and they're making sure that building their business infrastructures isn't just an IT decision. More than ever, IT and general management will be collaborating on E-commerce technology procurement to ensure that the technology's capabilities position the company to deliver on its key business strategies.

Another major trend is the emphasis of traditional, large brick-and-mortar companies to build online exchanges or marketplaces. Large companies such as General Motors Corp. and Ford Motor Co. have a substantial volume of supplier-buyer transactions, where they see adding value in order to derive an annuity stream revenue base.

One thing all these applications have in common is the need for reliability and scalability. This trend is creating a shift in the E-commerce platform and Web-application server markets. Some E-commerce platform vendors are bulking up their application server infrastructures (or partnering with app-server vendors) to move down-market into the infrastructure space. At the same time, Web application server vendors such as Allaire Corp. are adding commerce-oriented features and modules to their products, moving up-market into the E-commerce solution space. Even some middleware vendors are getting into E-commerce. The result is a market landscape that's murkier than ever for prospective buyers.

So, besides application focus and infrastructure capabilities, what are the other key areas to look for in an E-commerce platform solution? We designed our upcoming evaluation to pay special attention to the newest areas of user requirements and emerging trends in customer demand.

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