Magento 2 – Launch aftermath18 months after the launch of Magento 2 we are in March 2017 and after the glitzy go to market launch of Magento 2 (M2), it is fair to say that it was all sizzle and no sausage! Star Digital, a veteran of many Magento ecommerce builds in both Community and Enterprise versions, got fully behind the M2 platform launch, attending all of the partner events and trainings, completing the coveted Magneto 2 Trained Partner Exams, and eagerly awaited the release of the production ready software. As with any new software releases, our certified developers were wary of the newest version of the Magento platform, considering that it might be a little buggy. They could not have been prepared for what was about to happen! The software was practically unusable, but the Magento partner channel insisted that no new clients could spin up licences for the old Enterprise Edition software. They were knowingly forcing clients and partners onto an unstable environment. And, what’s more they were actively trying to promote Order management and B2B software add ons to new prospects. The new solutions were presented at partner events, but the Magento team couldn’t give anyone any clarity as to what the products did. We also lost a very good Enterprise Edition lead in this process and our faith in the Magento commercial team was rocked to such an extent that we have now exited the Magento partner programme. The client is about to launch on the Magento 1.9 Community product… The leadership team at Star Digital had to think long and hard about the future trajectory for the business, as the disruption that Magento 2 had caused started to have an impact on our lead funnel. Prospective clients were demanding Magento 2 but were not prepared to be ‘guinea pigs’ and so projects were kicked into the long grass. The financial impact on agencies became clear. Growth from the Magento channel slowed significantly… We dug deep, and agreed to take on a Magento 2 project with a new client. The lead time was 16 weeks, and in Magento 1 this would have been very straightforward. No integration requirements, no customisations, a plain straightforward build out with multiple storefronts. What could possibly go that wrong? In a word – everything! 16 weeks came and went, the project was fixed fee, and the leadership team watched the Harvest Time Tracker as it flew past the allowable man hours. By the time we launched the first storefront we were 298% over budget, and we had to swallow all of it. In the meantime we had scoped, started, tested and launched five Magento 1 projects! The developer team were monitoring and contributing to various forums and developer blogs across the internet on M2, but there wasn’t much to work with. Plugins for the simplest of things were conflicting with each other and the level of intermittent bugginess in the core product was unfathomable. It is totally fair to assume that there was a learning curve to Magento 2, but no learning could get around a product that was not ready for market. It was the opinion of the developer team that the client passed judgement on their ability believing that it must be them and not a product as well known as Magento. This became a difficult situation to manage expectations whilst maintaining relationships. Debate and difference of opinion on Magento 2 raged on in Star Digital’s studio’s as it did elsewhere. Plugin suppliers started to throw their hands in the air, they then got hit with the new Magento Marketplace rules that meant they had to give 25% of their revenue to Magento. So they just put their prices up… The developers and the customers had to go with it… The partner programme was renamed, oh yes, and the prices and revenue requirements were put up. The Enterprise licence costs were raised and tiered based on sales volume. Some of our existing customers were told they were going to go from $18,000 p.a to $75,000 p.a just for their licence! The Magento executives stated that it was still cheaper than the competitors such as Hybris, Netsuite et al, but they seemed ignorant to the fact that those clients, their clients, our clients chose Magento entirely because it was cheaper to licence. It was a farcical situation… Everything in the Magento market continued started to slow down even further, then Magento put the prices down temporarily, positioned as a ‘promotion’. And at the end of last year they started to give the previously paid for training away for free. The marketing stepped up another gear and started to extol the virtues of the Magento Community of developers. The talk of open source and a large group of tech integrators came back on message. Shopify started to steal Enterprise clients. What a mess! I’m sure the team at Magento would refute all of this, and maybe we just got caught in an alternative reality bubble – but I doubt it!
Magento 2 and Star Digital – Where are we now?Anyway, fast forward to the end of February 2017 and Star Digital are putting out a statement of intent. Magento 2 is now stable! Its not perfect, but its better. For simple straightforward projects… So send your RFI’s in if you want to look at a new build, cross grade or upgrade. We’ve got scars to show we got through this, but it comes at a cost. In February 2017 Star Digital became a Shopify Plus partner, because when we looked at the differentiation of Magento Enterprise with a licencing entry point of $22,000 (Sub $1MM sales annually) and Shopify Plus with a similar pricing structure but without the heavily tiered volume pricing we could see that Shopify Plus with its inclusive elastic hosting, management and upgrades was a better go to market proposition with a significantly total cost of ownership. We have to think about what is right for our customers, and in the Enterprise world we believe that Shopify Plus represents a better investment, and has a more robust strategy for feature rollout for B2B and EPOS channels. Sure Magento wins every time if you want to go off piste with the product and customise heavily, but that’s costly to build and support. Factor in that a typical brand with a heavily modified Magento 1 build is going to be looking at a rework bill in the region of 75% of the original build cost to upgrade to Magento 2 and you don’t need to be a genius to see why brands are shifting…. The agencies aren’t doing this to the customers, Magento is. Our learnings over the past year have guided our company thinking around Magento 2 of being one of buyer beware, and we have been very honest with prospects to allow at least a 20% upscale in time and cost compared with Magento 1. We are also hearing rumblings in the Magento Community of developers that they feel let down by the company and are starting to look at other options. Shopware is now being made available freely and has some smart features that could see it eating into the Magento Community market over the next 12 months. Competition is good, and I think we will see more clients specifying Shopify, Shopware and WooCommerce along side Magento Community editions. They would be crazy not to as the cost of development and ongoing ownership of the other solutiuons is currently far more attractive for the real growth segment of the ecommerce market- specialist niche retailers.
Magento 2 and the trajectory since launchLets face it, Magento 2 has been way too hard to get to grips with. We know that the Magento team wanted to get this right, they didn’t get into this to release something so buggy. But someone pressed the button and then tried to tough it out. Just seems to coincide with the VC’s entering the frame? Problems with Magento 2 have been well documented, ongoing and laborious, often because there was no reference material to support us, and bugs had a tendency to be intermittent so harder to triage and remedy properly. The developer community have stuck by Magento, and their loyalty is to be admired, but it looks like that loyalty is starting to wane and the commercial realities that the investors need to achieve don’t include the community. Magento want to sell licensing, and lots of it in the Hybris, Demandware and NetSuite spaces. And if you want to be a developer agency in those spaces you’ll need to have scale, and quality to survive. We can see there being a handful of agencies picking up all of the big work with the remaining partners fighting over the rest. Its just not somewhere that our leadership team wanted to be, particularly as the licence revenue kickback is one time only per client and there are no allowances made for adoption of existing clients. Add to that, the product infrastructure is still buggy even though Magento are fixing issues with every new release. We believe that this is really down to the original Magento 2 release being made available publicly before it was actually production ready. There is a huge volume of bugs for Magento to get through on GitHub and there are more being raised every day so clearing them off and reducing the size of the list will be a challenge for Magento. Their focus clearly has to be Enterprise first, so for every day, week, month that passes with the Community product being a barrier, those dreaded Porterian forces are allowing the competition to get a hold. And this is very public… The Magento 2 front end architecture has also been unexpectedly difficult to work with. The learning curve has been uber steep for our developers, who are vastly experienced M1 developers. It has required the learning and understanding of new technologies and architecture with scant reference material to consult. This was partially expected as there was a big change from Magento 1, but the way they have been incorporated into the product seems to have been complicated and hasn’t necessarily been thought about how the technologies would all work and fit together. The issue of new code deployment into Magento has been a real bugbear for the developers here; as it required downtime for live sites when deploying new code. Magento have tried to fix this with new functionality that allows you to generate/compile code per storefront now, but this needs some major improvements in our experience. This alone is a key factor causing M2 projects to take longer for our developers to complete compared to M1 projects. We have also noticed that the M2 product seems to be more driven and focused towards the Enterprise Solutions/Editions. As a result, the community edition and the community itself are suffering as there is a long waiting list of unanswered issues and outstanding bugs. The corporate stance from Magento is that the two versions (CE/EE) are forking, with Enterprise trying to head up the Gartner Magic Quadrant leaving Community the poorer cousin. It’s a bit rich really when you consider that the product is OGL at its core and built and supported by a loyal community. There is a real risk that the fork will lead to a competitor product emerging in the community, and without the volume that the community gives Magento it could be short ride to obscurity for EE. Then there are a lot of really popular extensions for M1 that do not have a M2 version yet, such as OneStepCheckout, Mirasvit Sphinx Search Ultimate and WebShopApps Premium Matrix rates, so there are predictable problems when it comes to migrating from M1 to M2 and giving clients the same functionality as their M1 version. Those plugin guys are not going to take the chance of releasing anything buggy so they are in a holding pattern, and this is holding Magento 2 back. Porterian forces at work again…
There is also some evidence that Magento solutions and hosting partners are deciding, like Star Digital to strategically exit the partner programme as they see no ongoing value to the partnership. We still want to be excellent practitioners in the delivery of Magento web sites and don’t believe that forcing clients towards Magento Enterprise is in necessarily in their interests anymore. We also see little value in a partner channel that is woefully under resourced and 100% focussed on deriving revenue over service. We understand that the partners are supposed to act as the sales force for Magento, but in order to sell effectively you have to feel supported, and you have to believe in the product. With the rises in Enterprise licensing revenue and the historic support that clients got for the previous fees, that became a disconnect for us. So it was with sadness, but no regrets that we decided not to renew our agency partnership with Magento in order to focus entirely on our customers wants and needs. We can still refer Enterprise clients to Magento, and we will continue to deliver some of the biggest, most complex Magento Community based sites with integration using our fully agnostic Connector Plus systems integration technology. We will at the same time extend our connector technology to work with Shopify, WooCommerce and Shopware to deliver enterprise level back office connectivity to these platforms as well.
Magento 2 and the future, given that we are seeing stability?With the latest release of Magento 2 (v2.1.4), we can see that it is finally a production stable release and Magento are starting to sort out some of the issues that have plagued it since its launch. We are now starting to see glimpses of the Magento 2 vision that was unveiled in 2015. The application stability is helping our team to get through Maganto 2 developments in a more timely and less buggy manner.. Also, the support given through GitHub from Magento is now very good and allows you to raise issues with the large developer community and directly with the Magento developers themselves. This means that every release of Magento is starting to get less buggy and more stable. Magento appear to be using more of their developer resource on fixing bugs instead of introducing new features (vapourware), which is what we feel it has needed. In fairness, the documentation that is provided is a massive improvement on the documentation for Magento 1. It is a lot clearer and concise, and from our own experiences, the development documentation is second to none. Each section and guide goes into great detail and the real-life examples and code snippets really help when it comes to understanding what you need to do. Our developers are all signed up for the training that Magento currently offer, which is free until 31st March 2017. This is a positive step, and we would encourage prospects and clients to take this up as well. The marketing and account management teams are also taking advantage of the product knowledge courses available on Magento U: https://u.magento.com/
So, despite the pros and cons, Magento 2 is here to stay… Whether it wwill be the behemoth of the ecommerce industry that defined Magento 1 only time will tell. With a current end of life for Magento 1 being scheduled for November 2018, whether we like it not, Magento 2 will be the only Magento offering from 2019. So, instead of trying to avoid the inevitable, our team are proactively changing their approach towards M2 – out with the old, in with the new. It is not only our approach to Magento that’s changing, we are actively researching the benefits and opportunities of other e-commerce platforms such as Shopify Plus, Shopware and WooCommerce. This ensures Star Digital remains a fully agnostic agency focused on giving our customers want they want and need, focussed on helping them to drive results. And the switchover is gathering pace… Since the new year, we have noticed a shift in clients now wanting their web sites in Magento 2, and the change has come suddenly. This shift in interest has influenced our thinking around the switch, so now we are starting to advise our M1 clients to start the switch over to M2 in the coming months to launch successfully starting Q3 2017. These upgrades should be considered as a re-platforming project, and therefore this does lead to discussions about other e-commerce platforms such as Shopify Plus, which is starting to make headway into the traditional Magento markets and is often a better practical solution for sub $5MM clients that don’t have major platform modifications. Clients that do choose the Magento 2 route with Star Digital, whether it is in Community or Enterprise can be assured that the discovery, scope and quality of build will always be to the highest standards. We all know that the Magento ecosystem is huge, and despite the poorly planned and executed rollout of Magento 2, the simple fact is that it will remain one of the largest ecommerce platforms available by user base, and as qualified Magento developers, we believe Magento can fix the bugs and continue to develop the platform to ensure they maintain their lofty position. We still love Magento, its a great ecosystem and community of developers striving to deliver brilliant ecommerce experiences for clients, we just got a bruising from the M2 launch and the partner programme experiences. If you have Magento RFI’s please do continue to send them over and we will be happy to quote for Community and Enterprise builds. For more information or to for any questions, please get in touch with us on 01604 696385 or email email@example.com.