Build vs. Buy: 5 Factors to Consider When Evaluating Technology Decisions

By Steven Read

The choice between in-house development or outsourced expertise comes up often in the world of e-commerce. The strategy behind deciding whether to build vs buy a solution is multifaceted – spanning across the business and affecting several teams. We’ve outlined some considerations to help your internal teams when making this important decision.

Budget and Costs

One of the most important factors in the decision to build vs buy software is a company’s budget. Investing in a third-party solution can seem expensive upfront, but these costs are transparent and largely predictable month-over-month, plus cover all expenses associated with ownership.

Building a solution requires businesses to absorb the entire cost burden of homegrown software- including the initial buildout, maintenance and support, legal and compliance costs, research and development investments, data storage, etc. These costs are ongoing and rarely predictable – so it is crucial to consider whether businesses have the bandwidth to continue to support bug fixes, platform updates, and ongoing maintenance. The chart below illustrates these costs per $1 of revenue:

The majority of software costs do not stem from initial development – but continued maintenance. By purchasing a solution, businesses can bypass these costs entirely and spend $0 on operational and maintenance costs in addition to saving on the salary associated with research and development, thus maximizing value from the solution and, ultimately, revenue.

Technical Literacy

It can be tempting for businesses with robust engineering teams to opt to develop in-house software solutions. But custom software development is complicated and comes with a number of considerations. For example, page load speed is critical to providing a good user experience. How will a home built system impact page performance? It’s also important to consider security and compliance standards – Will the software system meet internal security and privacy requirements or external standards such as ISO27001? Is your system able to instantly deploy across all channels, languages, and markets? We’ve outlined the most important questions to ask your technology team, including concerns around stability, performance, scalability, security, and support here.

With third-party software, businesses receive both the technology and expertise that comes with an enterprise solution. Businesses are provided with dedicated Account Managers who have deep industry experience. These on-staff experts understand how to optimize to achieve individual business objectives that maximize value.

Integrating technology from third party partners saves businesses the complications associated with development, in addition to providing a team of dedicated product and customer success experts from day one.

Time To Market

When you buy software, you know it’s ready to be integrated in days with minimal technical resources or risks. Developing a solution in-house can take months, even years, to implement and has a timeline that is largely unpredictable. The graphic below illustrates the steps required when building vs buying solutions:



Plus, it’s important to consider the additional time it will take to develop the solution to the same caliber available through third-party companies who have spent years perfecting their products. A solution that is developed and released internally is often a minimum viable product, versus a fully developed, robust solution available on the market. Purchasing solutions offers innovation that is already complete.

Often with software development, the need is immediate so it is crucial to minimize time to market. Purchasing solutions can reduce time to market by 90%, in addition to minimizing the risk of any unforeseen delays. At Rokt, with one easy and secure integration businesses can launch our existing product suite in weeks, as opposed to the months (often longer) it takes teams to develop and implement internal solutions – as illustrated below:

Core Business Objectives

A vital question to consider when choosing to build vs buy technical solutions is the core competencies and objectives of the individual business. It would be opportune for businesses whose core objectives align with creating and implementing the software solution to develop in-house. Businesses with the resources and expertise in place to create software solutions that are better or equal to existing products on the market will find that building their own software is preferred.

If there is any misalignment or doubt, however, buying solutions is advantageous. Purchasing software allows businesses to focus their efforts on their core objectives rather than the complications of software development. This is largely a matter of resource allocation. Developing, optimizing, and managing software drains businesses whose core objectives don’t align with creating software solutions. In addition to the technical resources required for the development of the software itself, building in-house solutions also requires legal resources to actively ensure compliance, teams dedicated to optimization, a support team able to deal with glitches and bugs, plus the hefty financial resources that come with software ownership.

By delegating the business function that the software solves to a third-party partner, businesses are saved resource depletion and are able to refocus the assets they would spend on building a solution – time, money, and talent – and invest them in areas with a higher business impact.

Delivered Value

Another important factor to consider is the delivered value from the solution. When building in house, businesses are empowered to create custom solutions tailored specifically to the individual business. Businesses understand their specific challenges and goals on a level that is not available when shopping for software, and they are thus able to develop a solution that aligns entirely with their needs. Developing from scratch gives businesses control that purchasing does not.

However, newly developed software lacks functionality that comes with time. Existing solutions from software providers have been developed and perfected over years, and come equipped with certain functionality that would take years to develop from scratch – like Machine Learning. Purchasing solutions give businesses immediate access to fully optimized technology, which is simply not possible when building a solution from the ground up.

Additionally, with software developed in-house, businesses can’t lean on the deep history of experience solving complex problems that comes with third-party partners. When purchasing software, businesses receive a team of dedicated experts whose mission is to provide value for their clients. These software providers work with numerous brands in various industries and are able to draw on these experiences to solve problems, predict patterns, and develop comprehensive solutions.

The Rokt Solution

Rokt’s unparalleled investment in research, development, and talent, have enabled us to build a product makes this decision easier. Our product offers the highest in-market optimization towards value in the transaction, and our deep experience solving complex problems delivers higher value, while freeing you up to focus on your core business objectives.

Think of us as an extension of your innovation team. We’ll provide enterprise commercial and technical support to help you rapidly test, optimize, and scale your campaigns. With our lightweight integration, you can be up and running in weeks, gathering insights, results, and conversions. With a solution ready to be deployed, you’ll have significantly lower costs and faster time to market. In the world of software, complications often arise, and these unforeseen complications can be highly damaging to businesses attempting to build solutions from scratch. At Rokt, we have a team of experts with years of experience solving complexities, whose sole focus is to optimize our products and provide solutions for you.

We’ve condensed this information for your convenience here.

If you’re ready to invest in a solution to make your e-commerce smarter, faster, and better: request a demo today.