Best Ecommerce Platforms for 2015 – Pt. 2 – Shopify
If you search Google for “ecommerce platforms,” you’ll find a lot about WooCommerce, Shopify, Magento, and Bigcommerce. If you do a little digging, you might find Miva, a longstanding ecommerce platform that’s not as well-known. Each platform has its own selling points and drawbacks. For some businesses, hidden drawbacks to any given platform may eventually overshadow that platform’s selling points. In this in-depth series, we’re examining the benefits and drawbacks of 5 major ecommerce platforms. In Part 1, we talked about WooCommerce. In Part 2, we’ll look at Shopify. Let’s dive in!
Shopify:
Shopify is a major player in the ecommerce game. With 150,000 active stores, Shopify is responsible for an incredible amount of online commerce. Shopify offers a range of responsive themes, Paypal integration, blogging functionality, a CMS (content management system) and a fairly basic abandoned cart email integration. In that regard, Shopify is generally competitive among ecommerce platforms. However, Shopify has some serious drawbacks which entrepreneurs should consider before committing.
The biggest problem with Shopify is its transaction fee schedule. This is tied to your choice of payment gateway. If you go with Shopify’s own gateway, Shopify Payments, you’ll be charged 1.8%-2.4% plus $0.30 on every transaction. The percentage charge depends on your plan tier. If you want to use Shopify Payments, you’re in luck. But if you want to integrate with a 3rd party payment gateway, you’ll pay two transaction fees every time you make a sale: one to your 3rd party, and one to Shopify itself. In this scenario, Shopify’s fee goes down to 0.5%-2.0%, depending on your plan tier. Keep in mind that you’re already paying Shopify for the software and hosting. If you’re considering Shopify, you should really crunch the numbers on your projected sales and margins and see how this all adds up.
Shopify’s discount functionality is also limited. The only discounts you can apply are percent off, dollars off, and free shipping. Clearly, these are the most common discount types; but what about scenarios where you need a different type of discount solution? Miva’s built-in discount functionality is far more robust. Without add-ons, Miva offers volume pricing, add-on products, basket discounts, buy product X and get product Y, product discounts, and two types of shipping discounts—entire order, or per-product.
Some developers have claimed that Shopify’s code is not lightweight. Shopify contains in-line javascript at the beginning of the page. Experts generally recommend using external javascript or putting it at the end of the page. Note that Miva in stock configuration has no in-line javascript at the beginning of the source code.
Shopify gives you two shipping methods out of the box. However, carrier-calculated shipping rates aren’t available in any plan below the $179/month tier. This puts smaller operations at a disadvantage. In Miva, shipping options are in no way tied to your website hosting setup.
Overall, Shopify provides a good value to startups and small online stores that don’t need unlimited functionality and have big enough margins to take the transaction fees. Shopify is feature-rich, and those features will work just fine for many smaller operations. However, the limitations we discussed could hamper a store that starts to take off. That’s a key question that entrepreneurs should ask themselves when considering an ecommerce platform: will this software still serve me well in 3 years? In 5 years? In 10 years? And in the case of Shopify, as business grows, how will those transaction fees add up over the years?
The Bottom Line
Shopify offers excellent functionality and features. However, its transaction fee schedule represents a serious drawback for businesses doing larger sales volumes. In this regard, Shopify is more suited to small operations that will stay small. For larger operations, or for fast-growing stores, Miva and Magento offer more freedom and flexibility and have no inherent transaction fees. Note, however, that they may be more expensive than Shopify to get off the ground.