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How Much eCommerce Revenue Do You Need for SF Commerce Cloud to Be Viable?

How Much eCommerce Revenue Do You Need for SF Commerce Cloud to Be Viable?

SF Commerce Cloud is designed for companies with serious, retail-oriented ecommerce operations. You have a chain of 50 stores and want to integrate it with ecommerce in creative and complex ways (in-store pickup for online purchases?) — then Salesforce Commerce Cloud is the right ecommerce platform for you, hands down.

But what about those mid-level cases? Of course, we have to evaluate each case individually, but a few clear patterns emerge.

Here is a rule of thumb that I usually recommend to clients:

Salesforce Commerce Cloud just isn’t worth it unless your gross revenue from ecommerce will be approximately $700,000 per year.

That is just a rule of thumb, and every case is different. The smart alec within me wants to say, “Well, what about those making $699,999?” And yes, that’s why it’s a rule of thumb and not a law written in stone.

There are a few reasons why Salesforce Commerce Cloud likely doesn’t make sense for ecommerce sites that gross less than that. 

The first reason is that Commerce Cloud has a non-trivial setup cost. While Salesforce makes most of its Commerce Cloud money via its commission structure, it still charges a very-low-six-digit startup fee. Often in the $150k range. If you’re selling just $50k/year in your store, and you don’t expect that to change, then it just doesn’t make sense to spend $150k on setup fees, no matter how awesome Commerce Cloud is.

There are many exceptions, of course. Each case really is individual — I’m not just mouthing those words. 

One exception is if you’re expecting explosive growth. Let’s say you’re a Silicon Valley startup with a huge marketing and growth budget. In that case, you want to invest in the best-in-class system to prepare you for that rapid growth spurt. Then Salesforce Commerce Cloud it is!

Another exception is when it is really important to use some of the core Commerce Cloud super-power functionality. A/B testing of complex user experiences, or unique promotions, are just two examples we’ve written about. In these cases, even if your ecommerce revenue is $697,123 then you may still want to consider Salesforce Commerce Cloud.

The $700,000 range is also a good starting point for another reason. For small sites, you can use Shopify and pay a few hundred dollars a month and you’ll be fine. But there reaches a point at which your sales are high enough that you will want to invest in not just more powerful functionality, but without site delays, with staging and testing environments, powerful customization, and so forth — things you can’t do with, say, Shopify.

But to do all these on the standard platforms that allow such deep customizations, like Magento, well, it’s the $700k mark, approximately, where SFCC cost/benefit analysis starts turning from a negative to a very strong positive, as compared to the other alternatives. 

In other words, the costs of servers, hosting, sysadmin and devops, and everything you would need with a Magento to get this level of control and customization, really starts becoming expensive around this point. Operating a server farm is something any layman who doesn’t want to lose his hair should stay away from!

Is Salesforce Commerce Cloud for everyone? As big of a booster of it as I am, the answer is a resounding no. Part of the art is to make sure you and your team and your business objectives are a right fit for the firepower of Commerce Cloud. Sometimes, you just don’t need a bazooka to kill a fly.

PS: UV is one of the world’s leading Salesforce Commerce Cloud development teams. Contact us to see how we can work together.

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