Shopify is so expensive and for a small-time shop hosting and paying the shop fee eat up your first 2-10 sales easily, where is the free platform that only charges per sale?
Will your business be viable if you can't even afford Shopify?
Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
81–90 of 144 posts
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#82I've been working with Shopify for close to 10 years as an owner of multiple profitable stores and as a full stack developer. If you work on the custom development side you'll see a lot more successful businesses run on Shopify.
I don't see the churn rate as a big problem for Shopify. Their revenue is pretty tied into the customer's revenue and expenses, not the amount of unique subscriptions. On top of subscription revenue, they have credit card processing and shipping labels which would be higher than the subscription cost for shops with high revenue.
IMO I don't really see Shopify and Amazon as really being in the same space unless Amazon makes a real push into curation and I think that would require a radical change in how Amazon works with sellers. I see Amazon as more of a competitor to Walmart, Target, etc.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#83Earlier quoted context omitted.
> but they also power some massive eCommerce businesses and growing number of enterprise shops. This makes no sense. Why would any company that starts making serious money continue to give SquareSpace money for a template. There's nothing you can do in SquareSpace that you can't do better in a custom app running on one of the many free software CMS's out there. I don't get this.
For lots of brands, the core competency is marketing and every other aspect of the company is outsourced. E.g. Kylie Cosmetics which has 360M+/yr in revenue and uses Shopify.
A more provocative example is Tesla. Literally their whole car buying experience is powered by Shopify.
They did ~$21B in sales last year.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#84I’m kicking myself for not investing in Shopify when I saw it in the 100s this year. Given the size of my average investment I could have made a good $20k in profit. Wondering if I’m making the same mistake again. Could this be another $1000 stock?
Meh, I bought it back in 2016 in the 20s. Also bought Twilio around then. Hit some downturn/burnout freelancing and sold it not long after. You win some and you lose some.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#85I might be drinking the amazon koolaid but Shopify’s online service and physical product distribution can’t even come close to what amazon has developed. They’re not a real threat. Amazon is really at least 15 years ahead in distribution and operations. We’re using robotics to automate a ton of processes. Jeff Wilke revolutionized the fulfillment centers. Shopify’s platform mainly sells niche things at low throughput…
> Jeff Wilke revolutionized the fulfillment centers
After 7 years in Amazon Fulfillment, I'll say this: we're doing a mediocre job- fortunately no one else is doing much better. But still, we've got 25 years of legacy software and processes to carry with us wherever we go.
There's a lot of potential for a new entrant to radically and rapidly innovate and compete inside the warehouse. Shopify's business model is different enough to make the fulfillment problem different in a few fundamental ways that might let them undercut further. Lots of potential.
There's also a great big Shopify office opening not too far from Amazon Toronto. And wouldn't you know it, there's a big chunk of Amazon Fulfillment right here in this office. I'm expecting to see poaching begin soon, just like when Uber opened here and hired a lot of Amazon Flex talent. (Non-competes sure are hard to enforce in Ontario).
I really hope they can prove themselves a viable competitor.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#86I've been working with Shopify for close to 10 years as an owner of multiple profitable stores and as a full stack developer. If you work on the custom development side you'll see a lot more successful businesses run on Shopify. I don't see the churn rate as a big problem for Shopify. Their revenue is pretty tied into the customer's revenue and expenses, not the amount of unique subscriptions. On top of subscription…
What if Shopify created a centralized e-commerce platform for every merchant to make their inventory available through?
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#87Earlier quoted context omitted.
eBay's marketplace (eBay.com) revenue should be the amount that's their listing fees and percentage of the final price that they take. The amount that the sold goods are worth should be the gross merchandise volume. See https://investors.ebayinc.com/fast-facts/default.aspx for their current numbers. Looking at their fees: https://www.ebay.com/help/selling/fees-credits-invoices/sell... , it seems to be 10% to 12% for…
A big chunk of that 3% Shopify fee is eaten by the CC exchanges. But they make money from the App Store, and monthly Shopify fees.
Ah, I didn't dig deep enough. There is the bit about $153 million in Subscription Services revenue which they say is due to mainly the monthly recurring revenue. Their Merchant Solutions seems to be related to the payment fees which is $208 million. My guess is a majority of the stores do not sell a significant amount of merchandise (so the monthly fee is a majority of the Shopify merchant cost) and merchants who do sell significant amounts of goods are able to negotiate a special lower payment fee rate (which most merchant platforms do).
From the growth numbers listed in the report, the gross merchant volume (and therefore the Merchant Solutions revenue) is increasing so maybe more merchants are being successful or the existing successful merchants are selling more. The Merchant Solutions revenue is growing about 18% faster than Subscription Services.
Shopify seems to be trying to make more merchants successful (more merchants selling more goods) versus just making it easy to open (and close) unsuccessful stores.
Hopefully Shopify is able to capitalize on increase in merchandise volume if they haven't been able to negotiate a good deal on the payment processing fees themselves. While they might make profits (and not just revenue) from their monthly fees and their App Store, I just can't imagine a merchant platform which does not capitalize on gross merchant volume since that's where the significant profit comes from (like eBay, for better or worse).
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#88Earlier quoted context omitted.
A huge part of Shopify's revenue comes from Shopify Plus. We're also fellow app developers[1], and we've noticed that if you offer value to their higher end businesses, you'll be running at churn rates that are much lower than what you'd think you'd get with the "average Shopify merchant". Something like 70% of small businesses fail[2], so it's not surprising you'll see a large amount of churn if your audience is the…
Also a Shopify app developer here[1]. My software targets established online sellers and my churn is considered low. [1] https://www.trunkinventory.com
You are right the churn is very high because one thing shopify can't do is get traffic for those online stores. So non tech savvy goes to Shopify open a store, because it's easier than running $5 VM to manage many similar e-commerce platform. But then that person needs to work himself for traffic acquisition on his own site which is expensive and after a while stops it. Launching a store is easiest thing to do with plethora of other platforms besides Shopify. On Amazon the story is different, store owner focus on to bring real traffic where buyer has a intention to buy. So from day one store owners focus is on getting sales. On Shopify first problem is getting traffic then convert to sales then to manage sales and delivery, store owner does all these which can be done on plethora of other tools including closed source or open source, with similar ease of use.
Whether it's Amazon or eBay they are spending a lot on getting traffic to those vendors who sale through them. Shopify has been a loss making entity for last three years without significant money on traffic acquisition for it's vendors, they do spend to get more store owner traffic not on buyer traffic. [1]
So I am not sure if Shopify can even be compared with eBay or Amazon. Reason eBay is affected is due to Amazon nothing to do with Shopify which is just a tool to launch an online shop.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#89As someone who worked developing Shopify apps (NOT a Shopifyt employee to be clear), I can attest to the incredibly high percentage of shops that evaporate from the platform on a nonstop basis. Something like 80% of the people that would install our apps in their shops would be gone or in limbo after a couple months. (Not an app uninstall, their shops actually no longer existed.) The charts we see from Shopify like t…
A big factor in their churn rate is the fact that a significant chunk of their growth has come from make money online gurus. Search YouTube for “Shopify dropshipping” or similar and you’ll see what I mean. It became viral among the scam artists, who all came up with different systems to sell, with one thing in common among them: Step 1 is to go open a Shopify account.
When the systems that most of these gurus sell fail to work, their students simply abandon their Shopify stores. I would never buy shares of Shopify for this reason. For now, they continue to grow because there are still thousands of gurus pushing Shopify, but we are reaching the end of that cycle. As soon as a new fad takes hold among the gurus, Shopify will be a ghost town.
Re: Now Bigger Than eBay, Shopify Sets Its Sights on Amazon
#90I just want to make a note that Tobi (Shopify's CEO) has made great contributions to Rails open source ecosystem with projects like Liquid and ActiveMerchant, which he started: - https://github.com/Shopify/liquid/commits?author=tobi - https://github.com/activemerchant/active_merchant/commits?au... We leverage these projects daily, so it's awesome to see his company doing so well. In addition, we're on Shopify's platf…
Liquid is awesome and documentation first rate.
I was pretty much able to dive straight into Shopify templating and leverage the docs as I went without even having a background in Rails or Ruby.