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At IWD, we’ve been usingMagento to build incredible, one-of-a-kind websites for more than a decade.

Our agency is a Magento partner and our staff is full of certified Magneto developers.

So, yeah.

We like Magento.

If your eCommerce company needs a powerful platform that will keep pace with your ambition, I know you’re going to like it, too (of course, it helps to work withan experienced Magneto agency).

That said, there are actually three different versions of this extremely popular platform:

  •        Magento Open Source – Formerly known as Magento 2 Community
  •        Magento Commerce – on Premise – Formerly known as Magento 2 Enterprise
  •        Magento Commerce Cloud – Formerly known as Magento 2 Enterprise – Cloud Edition

Each one offers something very different, so I put together the following comparison.  

Magento Open Source vs. Magento Commerce – on Premise vs. Magento Commerce Cloud

Before I jump into some of the many advantages that have made Magento Commerce so popular, here’s a quick summary of all three options.

Magento Open Source

Magento Open Source is completely free, but that doesn’t mean it’s completely lacking in features.

Since 2008, countless companies have depended on this version to create incredible websites that drive sales. This even includes a number of name-brand companies, like high-end fashion house Christian Louboutin.

It was designed with the basic needs of online retailers in mind, but all kinds of modifications are possible so you can further customize it to meet your company’s unique goals.

There’s also the massiveMagento extension marketplace, which will give you even more options for creating the one-of-a-kind website your business deserves.

While I wouldn’t say Magento Open Source istrulyfree – you’ll need to spend money on the aforementioned modifications – it’s a great choice for small businesses that need a lot from their sites but don’t want to spend a lot in the process.

If youdodecide to go that route, our Magento experts can help you build on Open Source to create the one-of-a-kind store your brand deserves.

Magento Commerce – on-Premise

Magento Commerce represents a serious step up in terms of capabilities. You’ll enjoy access to a long list of advanced features and unlimited potential for customizing your eCommerce website.

In a moment, I’ll go into more detail about some of the features that I think really make the biggest difference, but here’s a comprehensive list from Magento’s site:

Like I said, Magento Commerce represents a  significant  upgrade.

It’s become one of the most popular eCommerce platforms for companies – especially enterprises – that can’t afford to settle. Ford is just one of many examples:

With the on-premise version of Magento Commerce, your company handles hosting, whether this means literally having your servers on-premise or simply choosing a traditional provider.

Magento Commerce Cloud

There’s alsoMagento Commerce Cloud, which offers the same features as the last versionandcloud hosting throughAmazon Web Services (AWS).

This is no small feature.AWS comes with a number of benefits, including impressive encryption and security measures and virtually endless potential for scalability.

Bulk.com, one of the leading suppliers of sports supplements, relies on Magento Commerce Cloud for their online store:

How Much Does Magento Cost?

As I mentioned, Magento Open Source is completely free, though you may need to spend some money if your online store needs certain customizations.

For Magento Commerce and Commerce Cloud, things area bit  more complicated. I put together a completepricing guide for Magento that will walk you through the particulars, but I’ll quickly cover the main points here.

Both Magento Commerce versions operate on a tiered system that’s based on your eCommerce company’s Gross Merchandise Value (GMV).

Magento Commerce – On-Premise starts at around $20,000/month and goes up after your store passes $1 million/month. Because it’s theon-premise  version, how much you pay in hosting depends on the provider your company chooses.

If you opt for Magento Commerce Cloud, the price starts in the $20,000 range,but  that includes hosting. And, again, the amount will increase after you exceed $1 million in GMV.

As I mentioned, pricing depends a lot on what exactly you want for your eCommerce store. Feel free tocontact us if you’d like our team of experts to come up with a quote for your specific business.

10 BIG Advantages of Magento Commerce

Many business owners see that Magento Open Source is free and immediately decide that’s the best option.

However, there’s a reason so many of the most successful online companies have gone with Magento Commerce instead (for an example, check out this breakdown we recently did of how Wilson uses Magento Commerce).

I can’t stress enough just how much this platform has to offer. If there’s a feature you want for your online store, it’s possible with Magento Commerce.

The sky really is the limit, which is enough to justify the price for countless companies.

To give you a better idea of how Magento Commerce stacks up against Open Source, here are 10HUGEadvantages you’ll only get from the Commerce versions.

1. Page Builder

Magento boasts that theirPage Builder extension gives you “effortless control over your site content for maximum engagement.”

It offers a drag-and-drop approach to creating pre-built controls (or “content types”) for your site. Here’s a look at the four types Magento offers:

Choose the content you need for your page, drag it, drop it, and you’re done. No coding required.

Need something specific?

No problem.

Edit an existing content type or create a new one – whatever it takes to get the desired result.

The endless list of content types you can deploy on your site combined with just how easy it is to use makes Page Builder one of the most compelling reasons to spend the money on Magento Commerce.

2. B2B Module

If yours is a B2B company, your website has unique needs that you can’t meet with traditional solutions designed with B2C businesses in mind.

Magento Commerce has addressed this by introducinga B2B suite that is packed with valuable features.

Some of the standout examples for me are:

  • Credit limits
  • Customer-specific payment options
  • Customer-specific pricing and product catalogs
  • Customer-specific purchasing limits
  • Functionality for quick purchase lists
  • Quick checkouts
  • RFQ, price quoting, and even functionality for negotiations
  • User roles, permissions, and purchasing limits

That’s just a small sample.

Magento Commerce is perfect for any B2B company that wants more than just a website. The B2B module can turn your online store into a true competitive advantage that stands out from the crowd.

We also offer our own  Magento B2B Suite that works with both Commerce and Open Source. It’s packed with unique features like:

  • A marketing download center
  • A robust product offering matrix
  • Account credit limits
  • B2B dashboard with quick order tables
  • Custom quoting functionality
  • Quote management for wholesalers
  • Sales representative tools

And much,  much more.

This long list of features has given many B2B companies a real competitive edge in their industries. Instead of adding countless extensions to their Magento stores, they just leverage one, simple suite that encompasses endless opportunities.

3. Customer Segmentation and Personalization

WithMagento Commerce’s customer segmentation feature, you can create personalized shopping experiences for the wide range of customers who visit your site and, in turn,improve your conversion rate.

Dynamically display content, prices, and promotions to different customers based on specific criteria like their:

  •        Location
  •        Gender
  •        Order History
  •        Customer Lifetime Value

Commerce also lets you market specific products to customers when they’re on your site based on what they’ve already viewed or put in their carts – another simple-but-powerful way to effortlessly up your conversions.

4. Rule-Based Upselling and Cross-Selling

Without a doubt, one of the easiest ways to quickly improve your AOV (Average Order Value) and, thus, your overall revenue is by using cross-selling and upselling.

Just about everyone knows this, but actually putting these practices into play can be a tedious task that quickly loses its luster.

With Magento Commerce, this isn’t the case. The platform comes ready with the functionality to cross-sell and upsell. This isn’t some run-of-the-mill feature, either.

Magento’s version is supported byAdobe Sensei. So, you’ll be leveraging the power of AI and machine learning to analyze a customer’s shopping behavior in real-time.

The result?

Better product recommendations while they’re right there on the page.

It’s one more way the platform can increase your sales without making any major changes to your business model. Just decide which products to show customers based on their onsite behavior and watch your average order value grow.

5. Elasticsearch

Elasticsearch will give your eCommerce site an advanced search tool so customers can quickly find – and then buy – whatever they’re looking for.

This powerful tool understands multiple languages, supports stop words and synonyms, and can report valuable data and analytics in real-time. You can personalize Elasticsearch in a number of ways and scale it out as necessary as your site grows.

While you should design your eCommerce website so it’s as easy as possible for shoppers to navigate from one page to the next, Elasticsearch will give them a great shortcut for finding exactly what they want ASAP, which means more sales for your company.

6. Content Staging

If your current eCommerce website still relies on completely static pages, you’re going to loveContent Staging when you make the switch to Magento Commerce.

Content staging lets you create, preview, and then schedule whatever updates your site needs throughout the year all from the Admin panel.

This includes:

  •        Cart Price Rules
  •        Category Pages
  •        Category Price Rules
  •        CMS Blocks
  •        CMS Pages
  •        Product Pages
  •        Widgets

Whatever the case, you can schedule those changes all at once, so they’re ready to automatically deploy when you need them to. No more finding time in your schedule to change static pages manually and then making more time to change them back later on.

For example, instead of waiting for Black Friday to arrive, just schedule the changes you’ll want now. Create the pages for the products that will be on sale, decide what the prices will be, how many of them shoppers can add to their carts, and then preview these changes to make sure they’re perfect LONG before the big day arrives.

7. Visual Merchandiser

If you’ve ever had to manually adjust the order in which your products are displayed on your website, this next feature will probably be your favorite.

With Magento Commerce’sVisual Merchandiser, the days of assigning each product a number on the backend in order to move them around are officially over.

Imagine moving any product you want wherever you want it to be on a category page simply by dragging and dropping it to that location. Then just select the conditions that will prompt them to show up for a customer.

This is going to save you  a lot  of time and, possibly, your sanity.

8. Advanced Security

No matter how much you love an eCommerce platform, if it’s lacking in security measures, you’ll regret building your store on it.

Fortunately, Magento Commerce won’t let you down in this important department.

Compared to Open Source,Commerce is PCI compliant and supports credit card tokenization, two essential components for any modern eCommerce site.

Other security measures that are sure to help your peace-of-mind include:

  •        DDOS Protection
  •        Firewalls
  •        Secure Networking Connectivity

You’ll also have access to Magento’s technical support – more on that in a minute – should any threats manage to somehow breach your shop’s borders.

If you decide to go with Magento Open Source, you’ll also need to decide on how you’ll keep your site safe – both in terms of the technical assets required and the know-how required to use them.

This is enough reason for many business owners to opt for the Commerce version.

9. Advanced Marketing Tools

Speaking of advanced features, Magento Commerce comes armed with an array of powerful marketing tools. They’re the kinds that no online business should be without and, yet, so many are because of how much work it is to select, install, and run them all piecemeal.

Just to name a handful of the more popular examples, Magento Commerce’s advanced marketing features include:

  •      Abandoned Cart Emails
  •        Gift Registries
  •        Private Sales
  •        Reward Points
  •        Store Credits

Again, these kinds of features aren’t new to eCommerce. It’s just that Magento Commerce puts them all at your fingertips, so you can start using them right away to improve your sales.

If you forego these advanced tools by choosing Magento Open Source, you’ll have to spend a lot of time hunting down the best options for each of these marketing services and then the money on putting them to work.

10. 24/7 Support

One of the many reasons to work with a world-classMagento development team is because they’ll always be there to offer support no matter what comes up (even if you decide to go with Open Source).

Got a simple question?

We’re there.

Have an idea for a new feature?

Drop us a line.

Not sure exactly what went wrong but you’re  positive it’s catastrophic?

Don’t worry. You have a team of professionals who have seen it all before and will get things back to normal ASAP.

Now, if you  don’t  elect to work with us, the good news is that Magento Commerce will still give you 24/7 access to the company’s technical team.

You’ll also have an impressive library of Support Tools, which includes:

  •      System ReportsAccess snapshots of your system and save them for future reference. Compare your system’s performance settings before and after you make changes to server settings or code development cycles.
  •      Data CollectorMagento’s Data Collector gathers information about your system that you’ll need in case there are any problems with your Magento installation. Troubleshooting those issues is a lot easier when you have a backup at the ready – complete with code and database dumps.

While our advice is to always partner with experienced professionals, at least going at it alone is a lot easier when you choose Magento Commerce thanks to its numerous Support features.

In my experience, companies that do well with Magento Open Source also have an experienced technical support team who can address potential problems. This is absolutely vital. If you try building your site on Magento Open Source  without  this kind of team behind you, major problems are inevitable.  

Which Version of Magento Is Best for Your eCommerce Company?

At IWD, Magento is one of our favorite platforms to work with.

Just about anything is possible.

That said, Magento Commerce is clearly superior to its Open-Source alternative.

While the latter costs less, you’ll still need to spend some money – and plenty of time – on modifying it to your unique specifications. And, even then, you’ll run into limitations where Open Source is concerned compared to all that Commerce has to offer.

Of course, if you’re still on the fence, I get it. This is a big decision that will impact your company’s website and, by extension, your revenue.

So, if you’d like any help choosing, feel free to contact us. We’ll listen to what your unique needs and goals are before making our recommendation.


Let’s chat!