BR Cover Story | Romanian team led VTEX implementation for German retailer with EUR 8.2 billion in revenue

VTEX, the composable and complete commerce platform for enterprise B2C and B2B brands, continues to strengthen its presence on the European market, having recently announced its newest enterprise customer, OBI, one of the leading DIY multinational retailers headquartered in Germany. What is noteworthy is the fact that VTEX’s CEE & Germany operations are managed from the Bucharest office, meaning that the Romanian team was crucially involved in securing this partnership from day one and throughout the negotiation and implementation processes. The Program Management was assured by Catalin Vladescu, VP of Growth for VTEX CEE & Germany, who relocated to Germany for 12 months to oversee the end-to-end implementation of this strategic customer. Business Review got a chance to talk to Mr Vladescu to find out more about this landmark deal and how the Romanian team was able to secure it.

The new collaboration between VTEX and OBI marks a notable milestone in VTEX’s expansion across Europe, not only underscoring the company’s prowess in the digital commerce landscape, but also highlighting the pivotal role played by its Romania-based team. OBI, headquartered in Germany, operates over 640 stores across 10 countries and has a total of more than 40,000 employees, with its 2023 revenue reaching EUR 8.2 billion. Seeking to modernise its decade-old ecommerce platform, OBI selected VTEX over other enterprise digital commerce platforms for its composable and complete commerce solutions, which are aimed at streamlining operations and enhancing the customer journey, as well as its renowned ability to automate business logic and simplify infrastructure.

With the complete support of the Romanian VTEX team, the German retailer has already integrated its ecommerce, physical stores, and third-party sellers into a unified transactional platform. This integration expanded product offerings and provided customers with a seamless shopping experience across various delivery and pick-up options, allowing them to conveniently pick up online orders within just two hours.

“The decision-making process unfolded over a period of more than 8 months and took into consideration the existing omnichannel functionalities available in VTEX, security and privacy protocols, product architecture, infrastructure, and scalability capabilities. Furthermore, key aspects that allow the strategic expansion of OBI’s business model as well as the total cost of ownership were taken into account during the decision-making process,” Catalin Vladescu tells Business Review.

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VTEX strengthen its presence in Europe with a new enterprise customer, OBI, a leading multinational DIY retailer

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Compelling features of the VTEX Platform

Moreover, VTEX’s solid OMS capabilities that allow management of first-party and third-party orders in a unified way, the exhaustive logistics module that allows the retailer to define and automate its complex operational rules, and the API-first architecture that facilitated the implementation of OBI’s headless checkout and headless online sales channels were just some of the capabilities that made a difference in the decision-making process. All of the above are seemingly integrated with VTEX’s Product Catalogue, powerful Promotional Engine, and Marketplace capabilities—and all were leveraged by OBI in the implementation.

“With its composable and complete approach, VTEX was confirmed to offer the best overall package of capabilities for OBI’s omnichannel needs and expansion plans.”, Vladescu notes.

Integration and unification: a seamless experience

The German retailer chose VTEX as the backbone for its transactional platform in order to integrate its powerful brick-and-mortar store network, dropshipping partners, and existing digital sales channels and to expand its assortment with third-party marketplace offers. By doing so, OBI was able to leverage its entire fulfilment network and offer customers an improved shopping experience, regardless of whether they opted for home-delivered goods, BOPIS (buy online, pick-up in-store), shipping from a store or purchasing third-party goods from dropshippers or external sellers.

OBI is utilising VTEX’s multi-channel capabilities by integrating hundreds of VTEX Franchise accounts, each account representing one of the retailer’s physical stores, with independent stocks, prices, promotions, logistics, and fulfilment configurations such as pick-up points, opening hours, and independent shipping strategies.

To expand its business model, OBI is also taking advantage of VTEX’s native marketplace capabilities in order to onboard and list external sellers that enhance the retailer’s assortment.

The entire post-purchase shopping experience is orchestrated by VTEX’s OMS module, which natively splits customers’ orders into multiple sub-orders and packages, depending on the products and sellers the user has selected. The VTEX OMS also manages fulfilment allocation, making sure that every order is fulfilled most efficiently.

Increased agility and responsiveness to evolving market demands

One of the main benefits OBI has seen as a result of its partnership with VTEX has been increased agility. The entire product management lifecycle, from concept to launch, was significantly reduced in comparison to the previous platform solution.

“The partnership with VTEX gives OBI’s development teams a significant advantage in delivering incremental, rapid improvements for the benefit of the consumers. Moreover, the increase in development agility, along with the API-first architecture offered by VTEX, allows OBI to rapidly develop and integrate solutions and features in order to test their business impact. This gives the retailer a significant advantage to react to customer and market requirements,” says the VP of Growth for VTEX CEE & Germany.

Romanian team overcoming migration challenges

Transitioning from a monolithic system to VTEX’s modern, cloud-based platform presented challenges, particularly in terms of onboarding OBI’s development teams. VTEX addressed this by involving a team of specialists from its Romanian office to provide essential support and knowledge transfer. This collaborative approach ensured a smooth migration and empowered OBI’s teams to harness the full potential of the new platform.

“One of the main challenges we encountered during the platform migration process was the transition and onboarding of OBI’s development teams towards a software-as-a-service, cloud-based platform that was using a modern API-first architecture,” Vladescu explains. “As OBI was previously using a monolithic technology that was over 10 years old, the migration to VTEX’s technology stack allowed the retailer’s development teams a much-needed independence to build, test, and deploy individually, around VTEX’s core APIs.”

But this challenge was identified early on, from the project contracting phase, and was addressed by involving a sizable team of VTEX specialists in each development team to support OBI and external development partners with VTEX specific knowledge.

Enabling innovative potential & enhancing consumer and developer experiences

VTEX’s platform aligns perfectly with OBI’s strategic direction and innovative potential. Features like marketplace capabilities enable OBI to expand its product range with third-party offerings, driving business growth. Additionally, the SaaS model managed by VTEX reduces total cost of ownership and operational overhead, allowing OBI to focus on innovation and customer satisfaction.

“On top of the newly-gained capabilities and ownership cost reduction, OBI is able to leverage all of VTEX’s core commerce features, including B2C, B2B, Marketplace capabilities, as well as VTEX add-ons such as Live Shopping, Personal Shopper, Concierge commerce, inStore solutions, and many more,” Catalin Vladescu adds.

The migration to VTEX has also led to notable enhancements in both consumer and developer experiences. For consumers, VTEX’s headless checkout implementation provides a seamless omnichannel experience, allowing mixed orders from various fulfilment sources. For developers, the platform’s flexibility and independence have shortened development cycles and increased efficiency, enabling the rapid deployment of new features. VTEX’s logistics module has also enabled OBI to accommodate specific dropshipping functionalities. This allows the retailer to set delivery timelines at the SKU level, ensuring customers receive accurate, up-to-date information about delivery time for each item in their order. Overall, the migration to VTEX has empowered OBI to deliver a more seamless, personalised shopping experience for customers while also increasing operational efficiency and agility for the business.

Potential for scalability and international expansion

VTEX’s SaaS, cloud-based solution offers a structured commerce core, based on global ecommerce best practices, for OBI to develop and deploy its digital channels on all the markets where it operates. This allows a unified approach towards core commerce processes that translates into lower deployment and maintenance costs. However, since VTEX offers an API-first solution, the possibility to tailor and customise to market-specific needs via individual add-ons is always available.

Apart from the possibility of replicating the benefits on all the markets where the retailer operates, VTEX natively offers the much-needed vertical scalability to ensure the best performance of OBI’s digital channel, regardless of the volume of traffic and size of the traffic spikes.

“We want to allow a unified experience for our customers across sales channels and ecosystem partners – our technology backbone needs to reflect this accordingly. VTEX’s scalable platform has enabled us to continue unlocking our innovative potential, streamline operations, and seamlessly adapt to evolving market demands,” says Tim Engler, Senior Vice President responsible for OBI‘s group-wide IT. “By migrating to VTEX we replaced our more than 10 years existing ecommerce platform while at the same time enabling strategic marketplace capabilities opening our ecosystem to third-party sellers. In parallel, we have seen a significant increase in our team’s agility and capability to react to customer and market demands. The development and deployment process was significantly shortened compared to our previous monolithic solution, which gives us good confidence for a timely international rollout as well as new feature enhancements.”

 

Measurable success and future collaboration

The incremental migration to VTEX was closely monitored, ensuring that key performance indicators such as add-to-cart rate, conversion rate, and average order value remained stable or improved. The smooth go-live process and positive business outcomes underscore the success of the partnership.

“The migration and go-live on the VTEX platform were done incrementally, by gradually shifting traffic from 1% to 100% over a longer period of time. As a result, with this level of control and the newly gained agility, we were able to monitor all technical and business key performance indicators and assure that key metrics were in line or above existing values.” Vladescu explains. “Before the go-live, business indicators such as add-to-cart rate, conversion rate, average order value, etc. were monitored closely, alongside technical performance indicators such as page speed performance and error rates. As a result, after a successful and smooth go-live, we were able to see that no business or technical KPIs had any declines, and OBI is reporting above-plan business results.”

Looking ahead, VTEX and OBI plan to strengthen their collaboration by deploying additional solutions available in VTEX’s Commerce Core and add-ons catalogue. These plans are already part of OBI’s 2024 and 2025 roadmaps, indicating a promising future for this strategic partnership.

The crucial role of the Bucharest office

VTEX’s Romanian team played a vital role in this project. Managing the CEE and Germany regions from Bucharest, the Romanian office was involved from the very beginning, participating in negotiations and the implementation process. During the 18 months of implementation, the Romanian team constantly travelled to OBI’s German headquarters to support its development teams in Cologne in specialised workshops and periodic software development itineraries.

“The Romanian team was involved in the discussion with the German retailer from day one. Our sales and solution engineering team participated in multiple onsite workshops and conducted contractual and commercial negotiations with the German retailer. Once the contract was in place, VTEX involved over 20 team members, including Enterprise Solution Architects, Program Managers, and Commerce Solution Engineers, of which over 50% were allocated from the Romanian Office,” Vladescu also noted.

The partnership between VTEX and OBI illustrates how innovative technologies and strategic collaborations can drive significant business transformation. With enhanced agility, scalability, and customer experience, OBI is well-positioned to lead the competitive DIY retail market, while VTEX continues to demonstrate its capability as a premier commerce platform provider. This collaboration sets a benchmark for future projects and underscores the importance of local expertise and global vision in achieving business success. The Romanian VTEX office, under the leadership of Catalin Vladescu, has played a decisive role in this journey, demonstrating exceptional commitment, expertise, and innovation. As OBI continues to unlock new market potential and accelerate business growth, the foundations laid by the VTEX team in Romania will remain integral to its ongoing success.

This article was featured as the main cover story of the Business Review Magazine’s June 2024 edition