Is Shopify’s platform scalable for big brands and is its growth sustainable?
Report Available: July 21, 2016
Blueshift’s initial research found SHOP emerging as the market leading cloud-based, multi-channel commerce platform provider for small and medium-sized businesses. With over 275,000 active merchant platform users, the company has had some success moving up market to service higher volume merchants. Mobile orders are on the rise and the company is poised to become the market trend setter as it has integrated with FB’s Messenger platform and acquired mobile messaging leader Kit CRM. SHOP also has many competitors in its space and must overcome complaints about its cost and customer support, among other things.
- SHOP reported revenue growth of 95% and gross merchandise volume (GMV) growth of 102% for 2015 as the number of merchants using its cloud based ecommerce platform surpassed 275,000. Q1 2016 SHOP results saw a 95% increase in total revenue driven by over 51% of its orders coming from mobile devices.
- Shopify Plus, released in Feb of 2014, is designed for larger merchants needing a robust ecommerce platform. The company indicated it remains focused on the small to mid-sized business ecommerce solutions, but as its existing customers grow and expand, a high volume solution is needed. The new product has attracted several large and well-known companies including Google, Budweiser, Tesla, DODOcase, Red Bull, World Vision, Wikipedia, The New York Stock Exchange, and the Los Angeles Lakers.
- SHOP receives many positive reviews and performs well in head-to-head reviews against the competition. SHOP is the No. 1 ecommerce software solution according to a review by ecommerce platform’s blog site. Top Ten Reviews ranks SHOP at No. 4 with an 8.6 rating out of a possible 10. In head-to-head comparisons conducted by Merchant Maverick, Shopify emerged the winner over Bigcommerce, Volusion and Spark Pay.
- Merchant Maverick also listed negative reviews and complaints about SHOP, including add-on features or apps that can be expensive, the percentage of the total sale transaction fees, the lack of a one-page checkout, checkout redirecting shoppers to Shopify.com, third party designers and developers that do not like working with SHOP’s Liquid Templating, and limited discount features. Customer complaints include poor customer support, unexpected fees, and slow problem resolution.
- In Blueshift’s May 20 DWRE report, SHOP was cited as an ecommerce solution provider on the move that could offer significant competition in the mid-sized business market segment. One source said that SHOP has a great corporate culture and an excellent CEO. Another said SHOP’s growth is extremely rapid and huge opportunities remain for the company, but as it moves more into the mid and large merchant segment its capabilities and support will be pressured.
Can SHOP continue to add customers at or near its current rate? What is the satisfaction level of SHOP customers? Will Shopify Plus gain market share in the high volume merchant market segment? What is the total available market for SHOP? What do customers think of SHOP’s new features and services (mobile, shipping, loans, buy button, etc.)? What do customers want in native apps from SHOP? To answer these and other questions, Blueshift will issue a market research report by gathering data from independent sources in the following areas: SHOP customers, SHOP partners, App developers, Competitors, Competitors’ customers, and Industry specialists.
Companies: Shopify Inc., (SHOP), GoDaddy Inc. (GDDY), Square, Inc. (SQ), Wix.com Ltd. (WIX), salesforce.com, inc. (CRM), Intuit Inc. (INTU), PayPal Holdings, Inc. (PYPL)
Research Begins: June 27, 2016