At the beginning of your ecommerce journey, choosing the right sales platform sets the stage for how customers will interact with your brand. Factors like pricing, customization, and user experience are key in driving the decision on which platform to use. Two of the most popular options are Amazon and Shopify, and they represent two different approaches to managing your online business.
While both platforms exist to facilitate online transactions, they each have distinct advantages. Shopify is a robust brand environment where you can build out the sales process from the ground up. Amazon is a considerably more transactional platform with a large user base but limited options to help your brand stand out. These differences can be likened to buying trainers at a Nike Retail store compared to at a large sports retailer - you can buy the same product at both stores, but your customer experience will be vastly different.
Below are five factors to consider when determining which approach to choose for your brand:
Shopify: The subscription-based service is simple, intuitive, and comes loaded with themes and templates to build your storefront. A dashboard of basic marketing analytics helps you optimize your approach. Third-party integrations support features such as reviews and lead generation pop-ups add to the overall experience. It’s quick to set up your site and efficient to manage changes.
Amazon: Features are not as simple or intuitive at the outset, and it takes significant upfront time investment to navigate Amazon’s usage guidelines. The platform serves sellers large and small, and as a result is not optimized for any one group. While the functionality is ultimately there, getting your brand launched on Amazon will likely include some growing pains as you get comfortable with the platform.
Shopify: Shopify offers a full website builder, allowing brands to shape their user experience beyond being simply transactional. Layout, images, themes, and flow can all be customized to make your store an extension of your brand – a marketing tool as much as a sales tool. There’s more work involved in getting customers to your site, but you can control the customer journey, establishing an authentic connection.
Amazon: The ability to customize the user experience is limited. You control product descriptions and images, but the user experience is otherwise identical from brand to brand. While this makes the buying process easier for the customer, it also makes it more difficult to differentiate your brand. Amazon also suggests alternatives to your product on the product page itself, making it easier for customers to navigate away from your brand. To stay top of mind, you’ll need to invest in Amazon paid ads.
Shopify: The platform offers several tiered options. The most basic plan allows users to launch a Shopify store for around $40 per month, with upgrades to add features like more in-depth reporting and analytics, additional customer support, and international shipping. Shopify also charges transaction fees of up to 2% if you choose to use an external payment gateway like PayPal. There is no fee for using the Shopify Payments options.
Amazon: The basic professional plan comes in at about $40 per month. Smaller users have the option to sell with no subscription, instead paying $0.99 per transaction. Additionally, users are charged a ‘referral fee’ on each transaction, of 7-15% of the product price, depending on the category your product falls into. These plans only give you access to list your products on Amazon – there are no additional brand building features or advertising included, so you’re essentially paying for access to Amazon’s massive user base.
Shopify: While most regular online shoppers have probably bought from a Shopify site at some point in the past, there is no central marketplace or built-in audience to use as a starting point. It’s up to you to attract people to your website using traditional digital marketing levers like social media or Google to drive traffic.
Amazon: With nearly 200M regular users, Amazon is a massive marketplace with a well-established audience. It’s a great way to reach customers you would not usually target, although the challenge here lies in the overwhelming scale. A large potential audience isn’t very useful if customers can’t find your product in a sea of other options. Paid advertising or earning an ‘Amazon’s choice’ award can help with visibility, but you’re still beholden to search algorithms and customer ratings. If you can build brand awareness elsewhere, then drive customers to your Amazon page to purchase, this can be a great option.
Shopify: The platform has very limited support for order fulfillment so you’re likely to need a self-service solution. You can ship via traditional delivery services such as UPS or FedEx, coordinate with third-party logistics providers, or even handle fulfillment internally. While Shopify allows you to have complete control over your fulfillment approach, they won’t assist you in facilitating it.
Amazon: The Fulfillment by Amazon program offers a significant advantage to sellers, particularly to smaller businesses who don’t want to deal with inventory management. It allows your business to use Amazon’s shipping and warehousing infrastructure to store, pack, and ship products to consumers. Some additional fees apply based on package weight and shipping destination, but overall, this service serves as a huge advantage to fast-growing businesses looking to leverage the logistics capabilities of a global behemoth.
Both Shopify and Amazon offer tools to get your products online and available to consumers but weighing the pros and cons of each (and even considering if you can use both) is an important decision in how you choose to grow. Ultimately, consider the scale, sophistication, and brand building opportunities when determining the right digital commerce partner for your launch.
