Magento Commerce vs. Open Source: Which is Best?

For businesses looking to run a Magento webshop or an extensive e-commerce platform, Magento offers two versions: Magento Open Source and Magento Commerce. At first glance, both may seem similar, but upon closer examination, there are significant differences. What sets these two Magento products apart?

Differences between Magento Commerce and Magento Open Source

Over a decade ago, when Magento released its first version of the software, it was open source and, therefore, free. Since then, much has changed: the Magento portfolio has grown over the years, and many versions and products have been introduced. Currently, two major Magento versions are widely available.

Despite being from the same platform, Magento Open Source and Magento Commerce have considerable differences between them. Because of this many small webshops and startups use Magento Open Source, while larger companies and enterprises opt for Magento Commerce.

One reason for this is the cost. With Magento Open Source, you only pay for hosting, special extensions, and, if necessary, the agency setting up the webshop. Licence fees, on the other hand, are charged only with Magento Commerce. The amount depends on the number of installations and the revenue generated by the online store. Apart from costs, there are several other distinguishing features that make many medium and large companies opt for Magento Commerce.

Key feature differences:

Similarities between Magento Commerce & Magento Open Source

Magento is an extremely flexible and versatile e-commerce software. It can be customised to meet any and all requirements, whether it’s a trendy online store, B2B platforms, or complex digitalization projects for businesses. The latest versions of Magento Open Source and Magento Commerce are based on Magento 2. Store structure, categories, products, product attributes, prices, and more are identified and managed in the same way in both versions. Consequently, both versions offer navigation with filtering based on product attributes and intelligent price control with individually configured price rules. Moreover, they can be easily integrated with other IT systems via APIs. Thanks to the service layer, you can effortlessly combine Magento Open Source and Commerce with PIM (Product Information Management) or integrate it with the SAP system.

The Advantages of Magento Open Source

The undeniable advantage of an open source solution is that it is free. Combined with the availability of many extensions, Magento Marketplace provides a genuinely cost-effective and functional shopping system. Provided you have sufficient technical and specialised experience in using PHP to customise an online store according to your requirements.

Additionally, it’s essential to understand the quality of the extensions before installing them. While Magento strives for high quality thanks to the proven Magento 2 extension market, you should carefully check each extension you need. If you can handle both challenges, Magento Open Source is a good choice for many e-commerce projects with relatively low investment costs and high flexibility.

The Advantages of Magento Commerce

As the name suggests, Magento Commerce is designed to meet the needs of larger businesses. These are the highlights of Magento Commerce:

Scalability

Magento Commerce supports database sharing. The tables are divided into different databases, which can then operate in cluster mode.

Security

Magento Commerce offers better security. One reason for this is that the operating system is PCI-DSS (PCI Data Security) certified. On the other hand, administrative processes are recorded, and orders are archived. You can manage administrator rights for different pages, and in case of any incorrect changes in page content, you can easily load a backup.

Products

You can also search, select, and order products in Magento Commerce with the attribute ‘Storage’ (SKU). Combined with the ability for customers to import their own order lists and save their own item numbers or SKUs, the commercial version is ideal for B2B e-commerce.

B2B

Magento Commerce includes many B2B modules. These include customizable catalogues, creating organisational structures, and quotation modules.

Business Intelligence

In e-commerce, having all relevant KPIs (Key Performance Indicators) at your fingertips is crucial. Magento Business Intelligence (BI) allows you to collect, display, and assess your company’s performance holistically.

Customer Service and Loyalty

Magento Commerce offers a wide range of tools for customer retention and the ability to segment existing customers into individual groups relevant to their specific business. Similar to product rules, segmentation is carried out using a “rules engine.” This can be based on geographical and biographical information, order history, order totals, shopping cart features, and products. Through this segmentation, exclusive gift and loyalty programs can be implemented via the platform, including VIP zones or individual landing pages with special offers and customer approaches.

Conclusion

Businesses should not make the mistake of solely considering costs. Instead, attention should be given to the characteristics and quality aspects of both options. In the open source model, security, support, and further development are operational tasks of the users, which can be challenging to reconcile with the strategic approach of modern IT governance in large companies. In this case, licensing Magento Commerce is the better choice. Additionally, we would like to advise you to look for good Magento hosting, whether you choose Commerce or Open Source. Always be critical and choose wisely.