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The headless content management system (headless CMS) movement is well-documented by now. The headless CMS software market was valued at $328.5 million in 2019 and is projected to reach $1.16 billion by 2027.

Is the movement strong enough to crack the legacy world of CMS where vendors' roots go back three decades? Will CMS as we know it be blown up by new kinds of approaches to content experiences and the software that powers them?

Some investors are getting behind the headless movement over the past couple of months. Contentful, a Berlin-born, 600-employee provider that celebrates its 10th birthday next year, got a $175 million funding round and a valuation of $3 billion last month. Contentstack, a San Francisco-based company founded in 2018, offers headless CMS and received a Series B $57.5 million investment in June. It's now raised $89 million. Each are on the cusp of Forrester's leaders for Agile CMS platforms.

Here we break down some of the pros and cons of Contentful because in the software world, nothing's perfect. In fact, the State of Digital Customer Experience Report 2021 found organizational and data silos, rigid bureaucracies, immature infrastructure, scarce resources, outdated thinking, immature measurement and difficulties in understanding customers as some of the common and persistent hurdles with digital customer experience software. 

What the CMS Landscape Looks Like in Dollars

Contentful sells its software as a "content platform," one that is agile, has a strong partner ecosystem, operates in an API-first environment and decouples the front end presentation layer from the backend of content management so that marketers and creatives can freely manage content experiences. It does come with content governance and compliance challenges, as Forrester analysts noted in the Forrester Wave: Agile Content Management Systems, Q1 2021 in February and we cover that later.  

Here’s how some of the notable CMS players stack up in terms of investments and valuation:

  • Adobe: $312.5 billion market capitalization
  • Acquia: $173.5 million in funding, according to Crunchbase; acquired for $1 billion by Vista in late 2019
  • Contentful: $334.6 million in funding, according to Crunchbase; $3 billion valuation
  • Sitecore: $1.2 billion in funding, according to Crunchbase; acquired for $1.14 billion in 2016 by EQT
  • Optimizely: $251.2 million in funding, according to Crunchbase; acquired for $1.16 billion in 2018 by Insight Partners
  • Bloomreach: $900 million valuation

The trend with all these vendors lately? Expansion. Bloomreach, Optimizely, Acquia and Sitecore each acquired Customer Data Platforms (CDPs) in the past couple of years. Adobe's moved into "the work of marketing" with its Workfront acquisition. There was even a CMS acquires CMS with Crownpeak acquiring e-Spirit this year. 

What's next for the headless CMS vendors? Some see a potential CMS to CMS acquisition when considering Contentful. "It’d be hard to imagine a platform with so much potential not attracting the attention of the larger market," said Aaron Ladage, platform architect currently specializing in Contentful at DEG, a Merkle company that serves as a digital experience agency out of Kansas City. If the latest valuation of $3 billion for Contentful is accurate, an acquisition would be about triple what Sitecore, Optimizely (then Episerver) and Acquia got from private equity acquisitions.

Related Article: Ready for Yet Another Label for Content Management Software? Meet Agile CMS

What is Contentful, Anyway?

So what's behind Contentful? According to Contentful itself, “a headless CMS is any type of back-end content management system where the content repository ‘body’ is separated or decoupled from the presentation layer ‘head.’ Content that is housed in a headless CMS is delivered via APIs for seamless display across different devices.” 

Contentful and Contentstack are part of the MACH Alliance, a software consortium that supports technologies that are microservices, API-first, cloud native and headless.

Today, headless CMS isn't quite the go-to branding. “We call ourselves a content platform; that is developers and builders build on top of us in a variety of scenarios,” Sloan said. “In the sub category of CMS is headless CMS, and people talk about us in that light. Our perspective is that when you say headless CMS, because you say CMS, people assume that it's as narrow as web-only, on-prem, single-stack content management systems have been.”

Content management systems are website-rendering engines where as a content platform powers websites, a mobile app, kiosks, etc., according to Sloan. "You have to you have to think about that set of marketing experiences which are external," Sloan said. If brands are looking to replace their CMS, Contentful supports that scenario, though Sloan added his company’s role in helping brands craft digital experiences goes “far broader” than that.

“And so, the path we're on is to ideally help people understand what a modern content platform is and how it is different than what came before,” Sloan said. “Web content management, mobile content management and enterprise content management used to be three totally distinct categories with totally different players. Today, we serve lots and lots of people across those use cases. And so we're trying to evolve the conversation, and the way people think about what is possible.”

Headless Is Headless

But it’s a headless CMS, right? Some say so. Marcelo Lewin, founder of HeadlessCreator.com, said Contentful is definitely a headless CMS that is an API-first company, as most headless CMS companies are now. Contentful uses its own API to create the editor administrative tool it offers. “There are no ‘templates’ for the front end offered,” Lewin added. “You get an API, actually multiple APIs, an infrastructure to host your content and an editor tool to manage that content. The delivery channel is up to you and your developers to create. That definitely makes them a headless CMS company.”

DEG's Ladage said Contentful is definitely a headless CMS. He also sees it as more than that, adding, “I like to think of it more as ‘content as a service’ that can be combined with other best-of-breed services."

Sloan said Contentful can live side by side with other content management systems but has also seen clients migrate their properties over to Contentful, in order to get those benefits of having a single platform that works across all those devices and experiences. “And so that's something we see with, in particular, companies who've been with us for one, two or three years,” Sloan said. “We see them sort of march those old properties and sunset them as it makes sense for their business.”

Related Article: What Is a Content Experience Platform?

Pros: Partner Ecosystem, API-Driven

Lewin called the developer experience for Contentful a good one. In a demo with CMSWire, creating experiences using content components on the front-end seemed intuitive and lightweight but certainly not revolutionary.

Contentful offers multiple APIs, GraphQL, a CLI and a free self service developer version to start playing with Contentful. “I think the way they handle localization is also very intuitive,” Lewin added. Contentful’s partner and developer ecosystem is where Contentful excels, Lewin added, citing extensive partnerships with the likes of AWS, Gatsby, Netlify, Optimizely and others.

“Contentful offers what they call the Application Framework, which allows you to create apps that integrate with other systems using their API and plugging that app directly into Contentful using their Form36 design system, which makes the app look like it's natively part of the web admin interface,” Lewin said. “Their API library is pretty extensive offering APIs for delivering published content, for delivering drafts, for creating and managing content, content types, an image transformation API, a GraphQL API and a user management API.”

Playing well with third-party open APIs is at Contentful’s core, according to Ladage. Getting content out of Contentful is really what it does, and it handles this through a series of full-featured APIs, he said. Getting content into Contentful, from other APIs, can be accomplished either with the codebase, or directly within Contentful through their App Framework. 

Related Article: Rethink Your Content Strategy for a Headless CMS

Cons: Growth Areas: Governance, Compliance

It doesn’t mean it’s not without its challenges. The CMS is reported to lag in content governance and compliance capabilities. “I think the number 1 concern for me with regards to Contentful — and most other headless CMSes — is the authoring experience,” Lewin said. “When you create a content model, you try to keep it abstract so that it scales for the future. The problem is that forms that authors use to enter content are built around these content models and sometimes they can be too abstract and confusing for authors. They need to separate the content model from the creation of the form used to enter content by the authors.”

Lewin noted Contentful’s Compose application is trying to simplify this for authors, but he feels it has a long way to go before it's truly intuitive.

Ladage cautioned that by going full speed ahead toward the decoupling of the CMS from presentation layer, Contentful may have overlooked some niceties that are present in legacy CMS. “You’re now seeing Contentful add in some of these features, such as tagging, and the page-like views of their newly released Compose app,” Ladage said. “As Contentful continues to innovate, I hope they also continue to backfill nice-to-have features much as these into their product offerings.”