Over the past decade or so, e-commerce has exploded in popularity. Selling products online has never been easier in the digital world, but it doesn’t mean that it’s going to be simple.
The top contenders for e-commerce platforms are Shopify vs Amazon, as both websites let online stores sell whatever product they’ve designed and manufactured. The platforms have a wealth of benefits such as multiple selling tools and holding larger user bases.
In this guide, we’ll detail the different e-commerce platforms to help you decide which one is best to sell your products.
Shopify vs Amazon: What’s the Difference?
There are a few differences between Amazon and Shopify that might appear obvious. For instance, Amazon is a known marketplace that allows you to simply create a profile and begin selling. On the other hand, Shopify lets you design and build your e-commerce store from scratch.
In simpler terms, Amazon is a storefront you can utilize to try and attract millions of potential buyers while Shopify lets you build your own storefront. Many people might think this distinct comparison would make a clear-cut choice on choosing which platform to sell.
Amazon already has a built-in customer base, but it will take a percentage of every sale you make that can easily cut into your profits. Shopify lets you keep much more of your sales, but you must market the products by yourself, which means that sales could start out lower than selling on Amazon.
Both platforms have their pros and cons. Choosing the right platform can play a vital role in the growth during the early stages of your company’s success. Take a good look at your business model and find the site that is best suited for the business and produce more results.
Pros & Cons of Selling on Shopify
Shopify has quite a few benefits, which is why it’s become one of the most well-known e-commerce store builders on the planet.
One of the most notable benefits of using Shopify is that you don’t need any technical knowledge to build a great page. The platform features a user-friendly design that takes a drag and drop approach to building your storefront.
The site has built-in features that help make your site look exactly the way you want it. Several factors focus on the website’s backend, marketing, and sales activities. As a result, you shouldn’t have that much of an issue getting your site to perform the way you want it.
Some of the more notable benefits include:
- Quite a few e-commerce apps and tools.
- Significant amount of control over your storefront.
- Design is quite flexible and easy to implement.
- Ability to scale to your needs.
- Storefront is mobile-friendly.
- Lots of product categories for individual sellers to choose from.
However, that isn’t to say that Shopify doesn’t have its drawbacks. For starters, the traffic to your storefront starts off at virtually zero because you don’t have Amazon’s reputation to help market your business.
You’ll have to dedicate a significant amount of time, and possibly money, to market your products and storefront. While you may have to do this on Amazon as well, you could find yourself spending much more time and money on Shopify.
While the basic plan is quite affordable, it doesn’t include many features, so you may find yourself upgrading your plan to have access to more features. Though each plan comes at a relatively small price each month, the costs can add up quickly based on the plan and the features it comes with.
There are several drawbacks that you should be aware of, including:
- You must do all the marketing to promote the storefront.
- Fees can add up quickly if you depend on a variety of features.
- Additional transaction fees if you use a third-party payment provider.
- You can’t access reports if you have the monthly plan.
Fees are not exciting to pay, but the cost of Shopify plans are a key benefit that Shopify has a clear advantage over Amazon. If you use the platform’s extra features and add-ons a lot, then that advantage quickly goes away.
Naturally, you’ll have to keep all the above factors in mind when you’re deciding whether you’ll use Shopify for your e-commerce store. Some things might be more significant to you than others, so it’s worth taking the time to decide which plan is a reasonable option for your business.
There is a free trial option with Shopify, which may be worth trying if you’re struggling to make up your mind. While the trial may be brief, it allows you to poke around and experiment on the site to see if it’s worth your time and effort.
Pros & Cons of Selling on Amazon
As the most well-known online selling platform on the planet, Amazon comes with a large customer base and is ideal for any business owner looking to sell their products to large groups of people.
Since the company launched, it has implemented multiple selling tools for business owners to utilize which include a marketing platform, analytical tools, and much more.
Amazon features SEO tools that you can take advantage of. You’ll have everything you need to make your storefront a success. Similar to Shopify, you don’t need any technical skills to begin selling on Amazon. The e-commerce platform features a variety of benefits, including:
- You can start selling right after you sign up.
- It’s easy to reach motivated buyers.
- Refunds and returns process is quite comprehensive.
- Tons of sales report data.
- Instant access to a massive audience worldwide.
- Amazon SEO tools are available to promote your storefront.
Amazon allows business owners some flexibility and versatility in what items to sell. While there are some exceptions, you can sell almost anything on the platform. While Spotify also has a wide range of products you can sell, the platform might have more restrictions.
There can be a few negatives associated with selling on this industry giant though. Some factors might be enough to stop you from considering the site. Some of the more top drawbacks are:
- Fees on Amazon range from 15 to 40 percent per sale.
- There’s quite a lot of competition on the platform.
- You don’t have much control over your storefront.
- Many Amazon sellers have been known to use undercutting tactics such as fake reviews.
- You have no design options for your store.
As negative as some of these may be, they must be considered alongside the benefits of the e-commerce platform. You can start selling to a global audience from day one, which is a good starting point for your storefront. That can be quite an attractive proposition for many people.
However, you will be giving up a decent percentage of each sale. You’ll need to decide if the fees justify using the platform. You could always give it a try by signing up for the free trial, which allows you to experiment with the features and decide if it will be the right option for you.
The fees you’ll have to pay for using Shopify or Amazon could make a significant impact on your decision. After all, these fees cut into your profit margins. If you choose to go with Amazon Pro, you’ll have to pay a base fee of £29 plus VAT every month. Alongside this, Amazon will take 15 percent of your sales revenue.
If you add in Fulfillment by Amazon (FBA), the company’s fulfillment program, then your fees will become significantly higher. Storage and fulfillment costs must be factored in, which will bring fees up to about 35 percent. These fees add up quite quickly and will have a drastic impact on your profit margins.
Then there’s Shopify, which has three pricing plans. The Basic plan is $29 per month, the next level of Shopify is $79 per month, and Advanced Shopify comes in at $299 per month. Shopify’s basic package is roughly the same cost as Amazon, and it has almost everything you need to sell. The only thing it really lacks is reports.
That could make it seem as though it’s the better option between the two. After all, there aren’t any fees associated with individual sales that could add up to a significant amount of savings over a year or longer. Many budget and profit-minded business owners prefer this option.
You need to keep in mind some of Shopify’s drawbacks such as it not coming with a built-in audience, which means you’re required to do more marketing. These marketing costs can add up quite quickly, especially if you’re trying to outdo the type of traffic you’ll likely see on Amazon.
Shipping plays a significant role in all of this as shipping fees may affect your costs. However, this can vary dramatically depending on which countries and markets you’re shipping to. Although you do save money when you ship items in-bulk, you wouldn’t see it for quite some time.
Based on shipping, that would make Shopify the better platform to use in the beginning, but it may be worth transitioning to Amazon over time.
If you’re launching your first business or any new business, then you’ll need a little support and help. Thankfully, both Amazon and Shopify offer decent customer service to varying degrees.
Shopify seems to offer more assistance and support, which can be a great thing for many new business owners. They have a 24/7 live chat and phone number that you can take advantage of. Any issues can be fixed as quickly as possible.
On the other hand, Amazon has several support options such as a support forum. The forum seems to be much less helpful and accessible than Shopify. Overall, Shopify seems to be much better at helping its customers making it the better option if you prioritize customer support.
Can You Use Both at The Same Time?
When it comes to the e-commerce debate, many people believe that they have to choose either Shopify or Amazon. That’s what potential online sellers often struggle with as both platforms have unique benefits. You might not actually have to choose between them.
You can use both platforms simultaneously, although this will require extra administration and attention. If you want to capitalize on both websites, you can. In fact, neither company is against its sellers using the other company.
Shopify has an Amazon integration that you can use, which allows you to connect your Amazon account to Shopify and start selling to Amazon users. You will naturally see the benefits of selling on both platforms.
This shouldn’t take too much time or effort to configure. Once you have it done, selling should be relatively seamless. A long set up process might be off-putting to some people as you’re effectively doubling down on how much money you put up front.
However, it could be worth the effort and time as you’re doubling earning potential.
It should be noted that this can be an expensive option as you’ll have to pay fees to both Amazon and Shopify. If your marketing and sales efforts work though, then this could be quite a successful strategy.
The Shopify vs Amazon debate will go on for years to come. As highlighted above, it’s not as binary of a decision as you might think. Instead, it’s possible to use both if that’s what your company needs.
When you decide where to sell through, you’ll need to make sure that it’s the right one for you and your business. While selling on multiple platforms maximizes your potential customer base, it also means more time and energy looking after these platforms.
There’s pros and cons if you decide to use one platform over the other. That’s something that you’ll have to spend a significant amount of time thinking about.
What you should think about above all is where you’ll likely have the highest chance of success. Even if this isn’t where you want to sell through in the future, you can use it to kickstart your business and create a brand name.
Once that’s been done, then you might not need to rely on either Amazon or Shopify anymore.