Currently, Shopify now has more than 100,000 merchants and brick and mortar retail outlets, out of a total of 820,000 merchants using their ecommerce platform. Shopify just made a huge announcement and their stock popped up 7.5% today. Long story short, they are going to go head to head with Amazon.
Shopify is launching a network of fulfillment warehouses and shipping logistics capabilities throughout the United States that will allow for 99% of their merchants to offer two day shipping. They're going to spend over a billion dollars to build and operate this Shopify fulfillment network over the next few years. Really, what Shopify is trying to do is democratize e-commerce.
They don't want to admit it. But Amazon is essentially a dumbed down version of Shopify. It’s not a fully functioning website, but it's already providing you a marketplace to advertise to customers, fulfill orders, and more. There are brands that currently operate websites that take you to Amazon’s site to fulfill your purchase.
They also just launched a new Shopify plus, to build out on its current success with enterprise customers. Also Introducing 11 new language capabilities, a new Translation API, and an application programming interface for translating buyer facing content. This is super helpful for stores that only know one language and they want to be able to reach a broader market and ship internationally.
They're also offering the ability to redesign your online store experience, they've upgraded it so that you can now include videos and 3D models of products without having to know any code at all. You're also able to offer subscriptions directly within Shopify checkout. So you're no longer going to have to use an app to offer this feature.
Shopify is distribution network is going to use machine learning type of artificial intelligence to ensure timely deliveries and lower shipping costs. Machine learning is quite the buzzword recently, but not a lot of people actually know what it is. Basically, machine learning is allowing computers to learn for themselves and to improve as they act.
In the US, Amazon has over 150 million visitors per month. Meanwhile, Shopify has powered over $82 billion in sales through their ecommerce platform. Shopify provides powerful ecommerce tools and the ability to build a brand identity but extra costs with 3rd party apps and marketing can add up. As of December 2017, 197 million users visited Amazon’s website per month. That is ridiculous exposure. And Amazon can handle inventory storage, packing and shipping for you. It’s to be seen whether or not Shopify’s Fulfillment Network will be able to come close to Amazon. However, Amazon is hyper competitive and will limit your branding.
Shopify is an ecommerce platform while Amazon is an online marketplace. You build your own, DYI-style, store on Shopify while Amazon allows you to upload your products and sell alongside others.
To summarize, this move into fulfillment by Shopify will be huge for all ecommerce store owners. I am a huge fan of allowing easier access to budding entrepreneurs and Shopify is continuing to pave the way. And it’s not good if Amazon owns everything :)
Check back next week for a full breakdown on Amazon vs. Shopify including the pros and cons of each! I’ll let you in on a secret… you can and should be using both!