Magento Open Source vs Magento Commerce (Adobe Commerce) & Magento Commerce On-Premise

One of the most popular questions we get coming from someone who chose Magento as their ecommerce platform is: Should we spend more and get Adobe Commerce, or is the Open Source version fine as well?
This is understandable because the differences between the different versions can be confusing. In this article, you’ll learn about the differences between the different versions of Magento as well as what kind of business will benefit from upgrades.

So, let’s get started!

First, to make sure we are all on the same page, let’s make some basics clear.
Magento comes in two main different versions: Magento Open Source and Adobe Commerce (Magento Commerce). Magento Commerce can be further divided into Magento Commerce Cloud and Magento Commerce On-premise.

Magento Open Source

Magento Open Source (formerly Magento Community Edition) is the original version of Magento that’s self-hosted, and free to install for all. However, even though it’s free it is still a very sophisticated platform that can be used by ecommerce businesses of every size.  

Theoretically, you can go to the Magento website right now, download Magento Open Source, and start using it immediately. The reality, however, is not that simple. 

First of all, Magento Open Source is a self-hosted platform, meaning you will have to find and pay for your hosting. Note that Magento can be quite demanding when it comes to hosting, so you won’t be able to get the cheapest one. 

Next, is the price of development. Magento is not a user-friendly platform like Shopify where you can build a website without knowing how to code at all. This means you will have to pay for the initial development of your store as well as its regular maintenance. 

In this article, we discussed how to better approach the process of choosing an agency for this task. 

So, even if Magento Open Source is free on its own, don’t think that it is a cheap solution, because it has additional costs attached to it. 

Adobe Commerce / Magento Commerce

Magento Commerce (or Adobe Commerce, formerly Enterprise Edition) was built on the foundation of Magento Open Source. This means that it uses Magento Open Source as a base, and adds extra things to it, making it better in the process. Adobe provides it as a Platform as a Service (PaaS).

This tells us that on a functionality level Magento Open Source has zero advantages over Commerce version.  

Adobe Commerce is predominantly targeted towards enterprise companies, so it has some extra features useful to bigger businesses. 

For example, the content management system is better and allows for content staging, there are AI-driven cross-sales. B2B companies will also find lots of useful functionality in Adobe Commerce: Negotiable pricing, customer-specific catalogs and pricing, quoting system, and more.  

Open Source vs Adobe Commerce Feature Comparison

Source: business.adobe.com

Some the other extra features are:

1) Page builder, which gives you an opportunity to change website pages drag-and-drop style. To add to it, there’s also a Visual Merchandiser tool that allows you to position products in whatever order you like by moving them with your mouse. 

2) Customer segmentation and personalization: you can change the view of the page (for example, the price, promotions, structure of the page in general) based on factors like location, order history, gender. 

3) Rule-based upselling and cross-selling based on Adobe Sensei. Adobe Sensei is a tool based on artificial intelligence and machine learning to better understand your customers. Using the data from AS, Magento Commerce will make better offers for your clients resulting in a higher satisfaction rate and increased sales. 

4) Elasticsearch: advanced search tool that allows you to add synonyms and stop words, supports multiple languages, and adds an analysis tool that helps you understand your clients better.

5) Advanced security. Magento Open Source is also a secure platform (especially with added security-oriented extensions), but Magento Commerce goes a step further. It is PCI-Compliant and supports credit card tokenization, user data encrypting thanks to AES-256 and SHA-256 hashing, as well as many other added security features.

6) Technical Support. When you use an open source version of Magento, you have to solve your problems with the platform yourself, or with the help of users from the dedicated forum. Adobe Commerce, however, offers a more traditional technical support, available 24/7 through many different channels. 

7) Advanced Marketing tools, like abandoned cart email, gift registries, private sales, reward points, store credits, and more.  

8) Fastly Image Optimization: a service that allows you to offload image delivery to a cloud network, that optimizes them and serves a cached version, allowing your website to load faster. 

Magento Commerce On-premise

Okay, then what about the difference between Magento Commerce Cloud and On-premise? Let’s figure it out.

The main difference between the two is in the hosting. One of the biggest benefits of using Adobe Commerce compared to the regular Magento is the fact that it is a hosted platform. When you pay for it, among other things you get access to Adobe hosting and don’t need to set it up on your own.

But what if you need the functionality of Adobe Commerce, and for whatever reason don’t want it to be hosted by Adobe? For example, if you want more control over your hosting.

Magento Commerce On-premise is the perfect solution. It allows you to choose your hosting, and at the same time gives you all other benefits of Magento Commerce.

However, we should warn you that you need to pay attention to your hosting because Magento shouldn’t be hosted just on any platform. Research hosting companies specifically approved to work with Magento.

Magento Commerce Pricing

Now, let’s address the costs.

Adobe Commerce’s pricing policy isn’t available to the public and depends on many factors so we can’t tell you exactly how much it will cost for your business.
However, the price largely depends on your ecommerce sales, and there’s an upcharge to get the extra B2B functionality if you need it. The cheapest price of Magento Commerce starts at $30,000 / year if your annual sales are less than a million dollars, and goes up from there, with the biggest price being around $190,000 for companies that sell more than $25 million worth of products yearly.
Since you don’t pay for hosting, Magento On-premise will be a bit cheaper, but not significantly, so you would need to calculate if it’s worth it to pay for hosting elsewhere.

Which Version of Magento Is Best for You?

On its own, Magento Open Source has all the main ecommerce capabilities and will serve you well. But as we said at the beginning of this article, feature-wise Adobe Commerce is indisputably better than Magento Open Source. However, getting Adobe Commerce is a significant investment.  

To decide if splurging for the paid version is worth it for you, go through the feature list and see if you need all the extra features. Chances are, if your business is new they are nice to have, but not a must. 

However, if the scale of your company is bigger, or if with the type of products you sell you will significantly benefit from one of the functions (for example, if you work in B2B) consider reaching out to Adobe to get a quote for Magento Commerce. 

As for comparing cloud and on-premise versions, go for cloud if there is no significant reason for you to get separate hosting. More often than not, paying for Magento Commerce on-premise and hosting separately will cost more than just one payment to Adobe. 

If you have any other questions on this topic, don’t hesitate to reach out to us, we’d be happy to assist.