What It Means To Be Vendor Agnostic
With how competitive digital marketplaces are today, businesses are seeking ways to differentiate and streamline their operations. One method that has recently gained popularity is the notion of being vendor agnostic, especially in payment stacks. But what does this term entail, and how does payment routing play a part in realizing this strategy?
What Does Vendor Agnostic Mean?
Being vendor agnostic refers to the practice of designing systems, especially in payments and IT, that are not dependent on a single product, vendor, or platform. Instead of being tied to one specific software or solution, businesses that adopt a vendor-agnostic approach get the redundancy and flexibility of selecting from a wider range of products and services. This approach is rooted in the idea of not being bound by limitations or limiting risk of a particular vendor, ensuring that the business's needs and best interests always come first.
Is Platform Agnostic the Same as Vendor Agnostic?
While they share similarities in promoting flexibility and adaptability, platform agnostic and vendor agnostic are not the same. Platform agnostic describes the capacity of software or applications to function seamlessly across different systems, platforms, or environments. A basic example is software that works on multiple operating systems like Windows, MacOS, or Linux without the need for extensive modifications. On the other hand, being vendor agnostic implies that a business doesn't tie itself to a specific product, vendor, or solution but maintains the freedom to choose amongst various options, ensuring optimal solutions based on evolving needs.
Are you looking for flexibility in your payments stack? Spreedly can show you the benefits of a vendor-agnostic approach today!
The Benefits Of Being Vendor Agnostic
Vendor agnosticism isn't limited to just payments. Its benefits span across industries and business operations. Here's why companies are turning towards this approach.
Businesses aren't tied down to a single solution or vendor, allowing for agile adaptability to changing needs or new innovations. Often organizations must be able to quickly pivot payment processes to meet business demands. Still others need to be able to continuously test new payment solutions or payment methods in markets to see what works best for their customers and improve topline revenue. The ability to more quickly address these needs without overhauling an entire payments stack is critical.
Optimization and Savings
By not being locked into a single vendor, businesses can pivot based on cost-effectiveness and performance, ensuring always getting the best bang for their buck. For instance, an e-commerce store might switch payment providers if another offers lower transaction fees. Saving one percent on transaction fees may seem like a small amount but it adds up if you’re doing a high volume of transactions.
If one vendor faces challenges or goes out of business, having a vendor-agnostic approach ensures continuity and prevents disruptions. For example, most businesses use a single payment gateway. If the gateway you’re reliant on goes down without a backup and routing rules in place there is potential for significant revenue loss.
Avoiding Vendor Lock-In
Similar to risk mitigation, vendor lock-in, a scenario where a company becomes too dependent on a single provider's products or services, can be risky. Vendor agnosticism eliminates this risk. A common example is a software company developing on multiple platforms can easily adapt if one platform's popularity wanes.
Payment Routing Enables Vendor Agnosticism
Imagine a global e-commerce company with customers spanning across various countries, each with unique payment preferences. If this company is tied to a single payment gateway, they might encounter challenges expanding into new markets or risk alienating customers who have different payment preferences.
By adopting a vendor-agnostic strategy, this e-commerce company implements payment routing to manage multiple payment providers seamlessly.
- They can cater to the diverse payment method preferences of their global customer base
- They can continuously optimize transactions based on real-time data
- They can ensure reliability, with transactions being rerouted in cases of a particular gateway's downtime
The Role of Payment Routing:
Payment routing intelligently ensures every transaction takes an optimal route, leading to efficiency and customer satisfaction.
- Enhanced flexibility with multiple gateways
- Continuous optimization based on transaction data
- Increased reliability through automated routing and retry rules
- Simplified global expansion with region-specific gateways
Becoming Vendor Agnostic Is Important
Being vendor agnostic isn't just a trend. It's a strategic move offering flexibility, cost savings, and limiting exposure to risk. An agnostic approach helps a variety of organizations with many different needs.
For larger enterprises with relationships with many payment providers and rules and routing tools in place, orchestration can be used to complement an existing strategy. In this case the focus may be on performance and optimization.
For an organization just beginning to augment their stack with additional providers and tools, an agnostic approach fueled by orchestration can help to identify, experiment with, and limit the development and maintenance needs. The focus here may be on capturing as much top line revenue as possible. Regardless of the needs, there are tremendous financial advantages to becoming vendor agnostic.
Reach out now to explore a vendor-agnostic payments approach for your business.