Shopify is best use case for $0 to $1M ish, depending on product line, how many transactions that makes up, and if their are some custom things that are not possible on Shopify that realistically lead to huge gains that would cover more costs of a custom solution with something like magento.
I recommend Shopify to everyone starting out. That's what we used at Diamond Candles up until about a $5M run rate. We were/are growing quickly so we hit a point where payoff of customizing checkout flow, add of social sign on, etc. that could not be done because of Shopify, would cover and surpass costs of a more custom option.
Best to think about this simplistic example.
View the ecom platform market in about 3 buckets.
1. Starting out: $0-$1M ish
2. Wow looks like you have a business: $1M-$20 or 50ish
3. You are/could be publicly traded: $50M+
Take a look at usage #'s for market share size from independent third party analytics tools from Builtwith:
http://trends.builtwith.com/shop/Shopify/Market-Share
http://trends.builtwith.com/shop
http://trends.builtwith.com/shop/hosted-solution
Just because something is found on the web more isn't the full picture. Ie. I could make a blogging platform and have a bunch of scripts and bots install it on millions of domains and I would have majority of the market for blogging platforms (ya that would take a while and isn't a realistic scenario but you can get the point).
Providers dominating the different categories by companies in those areas actually doing volume and being succsessful?
1. Shopify, BigCommerce, Volusion, Magento GO,
2. Magento (varying editions), Yahoo Stores, Symphony Commerce
3. Demand Ware, GSI Commerce, Magento (varying editions)
At the end of the day a good illustration goes like this.
A truck and a moped are two different things. A truck is not trying to out 'moped' a moped and a moped not trying to out 'truck' a truck. They are both perfectly suited to different applications, situations, needs, and circumstances. The same goes with who you choose to handle your ecom platform.
For 2-3 search for internet retailers first 500 and second 500 lists. Pull off all ecommerce companies doing between $10-$50M as an example. Use the builtwith.com chrome toolbar to tell you what platform they are using. Hire someone for $2 an hour via odesk to make a spreadsheet of everything and the make a pretty little pie chart. Now you know what each revenue volume level chooses as 1, 2, 3 preferred platforms.
Option 3 as a side note but very important one, is primarily a platform and commerce as a service model with companies like Demand Ware and GSI Commerce leading the market with platform and services including but not limited to customer service for the brand, fulfillment, marketing services, website product photography etc. Their pricing models are based on gross revenue share. ie. SportsAuthority.com does $100M online this year, GSI takes 30% of that to cover everything.
(I am not sure who Sports Authority uses, just an example)
You can almost pick any traditional brick and mortar retailer and if they have a website where they sell things, they all do, GSI or DW are the people behind the scenes running the call centers, shipping etc.
Diamond Candles, my company, who started on Shopify decided to not go with a the market dominating option of Magento for a few reasons. One of which being upfront cost for an agency or on staff magento CTO type. We decided to partner with a newer entrant, Symphony Commerce, which blends the 3rd category model of platform plus service.
Rev. cut is significantly smaller than providers in category 3, but still get benefits of volume savings on shipping volume, scalable customer support that can handle rapid growth and occasional spikes without us having to worry about scaling or implementing best practices, and a fully customizable platform as a service so to speak that doesn't require us to have in house tech but where we are essentially renting part time ecommerce engineers from with resumes that list Google, FB, Twitter, Magento, Amazon, etc.
So in summary. If you are <$1M in revenue just roll with Shopify. Greater than that but less than $50M ish then I would recommend looking into Symphony.
If Symphony is interested in letting you in then you won't have to incur the upfront costs of an agency or implementation and you will have an ongoing partner equally incentivized i your long term success financially which I prefer as opposed to an agency model which economically is incentivized to offer a one time finished product and their revenue is not tied to my financial success.
It is the closest thing to an equity partner while returning our full equity.
Honestly depends on where you want to be in the next 5 years and if you want to keep paying monthly for a system along with how much customization you want.
Hosted solutions you are limited to the features and plugins they offer you. When I say hosted solutions I mean Shopify, bigcommerce, magento go, Volusion.
Personally for all of our e-commerce clients we use Magento Community or Enterprise edition. The advantages of this are they own the site once it's down. The hosted solutions you're paying for space on their server but if you every want to leave you have to start all over on a new system. Magento is a very popular system and is owned by Ebay. http://www.x.com/
This is part of a blog post that I wrote but have not punished yet because it still needs some editing.
What about the hosted solutions Volusion, Big Commerce, Magento Go, etc?
While can build sites for Magento Go and Big Commerce we still like using Magento Community and Enterprise editions over any hosted solution. Main reason is with those platforms you don't have access to the code and you cannot make custom modifications. Also, their extensions, plugins, mods community is not as large. Here is a real life example...Most of my customers want their product SKU number to be displayed on the product and category pages. Since it is just PHP code I can just place the code where it needs to go and it will display. I have not found a way to do this on Magneto Go or Big Commerce. The bottom line is those systems are hosted solutions and you physically do not own the site just the content on it. With Magento CE or EE you own the site. The site is 100% yours and you can do whatever or move it to whomever you want. There are no limitations (except Magento does own the code to their software).
It comes down to what you want to do and where you want to be in 5 years. Do you want to own your site or pay a monthly fee along with do you want custom add-ons. Magento has a huge list of addons you can add to your site simple stuff like social media logins for facebook and twitter. Possibilities are pretty endless with Magento unlike the hosted solutions that give you what they want to give you.
I honestly have tried both and have to say both of them are equally as good. It boils down to personal preference. In the past few months I have helped a few friends set up their shopping carts and went with Shopify because their Affiliate commission.
If you do decide to go with Shopify be sure to check out their 4th Build a business competition http://www.youtube.com/watch?v=zZciwQ6ZlsY
I've been using Shopify for four years, and love it. I tried a few others systems, and all had their shortcomings.
After 4 years of running an ecommerce business, I would say the platform is one of the easier decisions you will make. Be focused on traffic and building a page that converts.
It all starts with Shopify and BigCommerce really does. Let us look at both a bit closer. BigCommerce and Shopify are website builders that allow you sell products digital or physical online. Both products run in a web browser, which means that there is no software to install on your desktop or laptop computer, and you can manage your store from anywhere (so long as you have an internet connection). The key idea behind both products is that you can use them to build an online store without needing to design or code anything — you pick a template from the range provided, upload your products, set your prices and you are, in theory at least, good to go. It's worth saying however that while you don't need to involve a web designer when building a Shopify or Big commerce store, a good eye for design, along with some high-quality pictures of your products, are very important if you are to achieve professional results with either platform.
Both Big commerce and Shopify are 'software as a service' (SaaS) tools. This means that there is an ongoing cost to use them you pay a monthly or annual fee for access to the software.
1. BigCommerce pricing vs Shopify pricing:
BigCommerce offers 4 pricing plans:
a. BigCommerce Standard: $29.95 per month
b. BigCommerce Plus: $79.95 per month
c. BigCommerce Pro: $299.95 per month
d. BigCommerce Enterprise: varies depending on requirements
BigCommerce’s cheapest three plans form part of its ‘Essentials’ range, which are now marketed in a somewhat distinct way from its Enterprise plan — look out for the ‘Essentials’ tab on the BigCommerce website.
Shopify offers 5 pricing plans:
a. Lite: $9 per month
b. Basic Shopify: $29 per month
c. Shopify: $79 per month
d. Advanced Shopify: $299 per month
e. Shopify Plus: pricing varies depending on requirements
Like BigCommerce, Shopify also offers a free trial, which lasts for 14 days. As can be seen above, you can start selling goods online a lot cheaper with Shopify, with the 'Lite' plan only costing $9 per month. However, there is a big BUT with this plan: it does not actually provide you with a fully functional online store.
Rather, it allows you to:
a. make use of a "Shopify Button" — an embeddable widget, sort of like a Paypal 'buy now' button, to add a shopping cart to an existing website
b. use your Facebook page to sell products.
You can also use the Shopify 'Lite' plan to sell goods offline (at 'point of sale') and use the Shopify backend to manage orders and inventory.
2. BigCommerce Enterprise and Shopify Plus: You'll notice from the above price breakdowns that there are two plans listed above without specific pricing, 'BigCommerce Enterprise' and 'Shopify Plus.'
As their names suggest, these are basically 'enterprise-grade' versions of the platforms, which are aimed at corporations or store owners with extremely large volumes of sales.
As such, they contain a lot of advanced features, including:
a. guaranteed server uptime
b. advanced API support
c. dedicated SSL / IP address
d. advanced security features
They usually offer more in the way of account management and onboarding too you'll get far more hand holding (i.e., a 'white glove' style service) from Shopify or BigCommerce if you opt for one of these plans. They are also more 'bespoke' affairs than the other plans discussed above a BigCommerce Enterprise or Shopify Plus purchase typically starts with an in-depth conversation where requirements are gathered; after this, a plan is tailored to suit those requirements. Accordingly, the price of a BigCommerce Enterprise or Shopify Plus plan can vary from customer to customer. That said, there is a reasonable amount of consistency in the Shopify Plus pricing from conversations I've had with Shopify, the monthly pricing for Shopify Plus tends to hover around the $2000 per month mark.
3. A key pricing comparison: BigCommerce ‘Standard’ vs Shopify ‘Basic’:
A key comparison to make between Shopify and BigCommerce pricing involves looking at the 'Basic Shopify' plan, which costs $29 per month, to see how it stacks up against the ‘BigCommerce Standard' one, which costs $29.95. These are the plans that many first-time users of both products will be thinking of going for. Both these plans allow you to sell an unlimited number of products, with BigCommerce winning in terms of out-of-the-box features. The $29 ‘BigCommerce Standard’ plan provides a few particularly important things that you do not get on the equivalent 'Basic Shopify' plan, namely:
a. professional reporting functionality
b. a built-in ratings and review system
c. a built-in page builder
d. automatic currency conversion (based on geolocation)
e. real-time carrier shipping quotes (from third-party carriers)
About ratings and reviews, it is worth pointing out that Shopify does not provide this functionality on any of its plans: you will need to use a separate app to handle this. Fortunately, Shopify provide a free app for this purpose (the appropriately named 'Product Reviews' app). This has garnered good reviews from its users, but I find it slightly puzzling that the functionality isn't included as a standard feature.
In addition to Shopify's own reviews app offering, you can install a wide range of third-party apps to provide reviews and ratings functionality, many of which offer more advanced features than the standard Shopify 'Product Reviews' app (and integrate with the likes of Google Reviews, Disqus and Facebook). Although BigCommerce generally includes more features out of the box on its $29 plan, the 'Basic Shopify' plan has two important edges over it. First, the Shopify plan does not impose any sales limits; by contrast a sales limit of $50,000 per year applies on the BigCommerce Standard plan. Second, Shopify offers an abandoned cart saver on its entry level plan, whereas this is only available on the BigCommerce $79.95 plan and up. The abandoned cart saver which automatically emails people who leave your site mid-way through a transaction is a useful piece of functionality which can increase the revenue of your store significantly.
4. Transaction fees: A big question that potential users of Shopify and BigCommerce may find themselves asking is this: what's Shopify or BigCommerce's cut of my sales i.e., the transaction fee per sale — going to be? Well, it's a bit of a win for BigCommerce here, because it charges 0% transaction fees on all its plans. Shopify charges 0% on all plans too but only if you use their own 'Shopify Payments' system to process card transactions rather than an external payment gateway.
If you don't use Shopify Payments, transaction fees do apply and these vary with the kind of plan you're on (2% for ‘Shopify Lite’ and 'Basic Shopify'; 1% for 'Shopify' and 0.5% for 'Advanced Shopify').
The key thing worth noting about Shopify Payments is that it can only be used in certain countries, namely:
a. Australia
b. Austria
c. Canada
d. Denmark
e. Germany
f. Hong Kong SAR China
g. Ireland
h. Italy
i. Japan
j. The Netherlands
k. New Zealand
l. Singapore
m. Spain
n. Sweden
o. United Kingdom
p. United States (note however that Shopify Payments is not available to US territories except Puerto Rico.)
So, if you do not live in one of those countries, you will have to use an external payment gateway provider and you will have to pay transaction fees.
5. Credit card fees: In addition to transaction fees, there are credit card fees to consider. These are the fees charged by the company providing the software to process your customers' card payments. If you decide to make use of a third-party payment gateway (an app for processing credit cards, basically), these will be whatever your chosen provider's rates are. However, both Shopify and BigCommerce offer 'out of the box,' recommended payment processors, which can reduce these fees; these options also make it easier to set up card payment processing. The Shopify payment processor is ‘Shopify Payments’ credit card fees for this will vary according to whether you are selling online or in person (in a retail setting, market stall, pop-up shop etc.), the country you live in, and the plan you’re on. In the USA, you can expect to pay between 2.4% — 2.9% per transaction. BigCommerce's recommended partner for credit card processing is PayPal, powered by Braintree. The credit card rates are 2.2% to 2.9%, depending on plan. This makes the BigCommerce US credit card fees slightly cheaper than the Shopify equivalents, especially where the more expensive plans are concerned. Merchants selling low volumes of goods will not really notice the difference too much, but store owners with high volumes of sales will. If you live in the UK or another European country, you will be able to avail of considerably cheaper credit card fees with both Shopify and BigCommerce. In the UK, for example, Shopify’s credit card fees range from 1.5% to 2.2% (+20p); BigCommerce’s UK rates range from 1.55% to 1.85% (+18p).
6. Annual discounts: Both BigCommerce and Shopify provide a 10% discount if you pay upfront for a year's service (note however that BigCommerce only facilitates this on its 'Plus' and 'Pro' plans). Shopify goes one further and gives you a 20% discount if you pay upfront for two years (on all plans).
As you can see that in some quarters Shopify is on the top while in others Big commerce has the upper hand.
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath
