Shopify vs. Amazon: Which is Better For Your Business in 2023?
The comparison of Shopify versus Amazon is probably one of the hardest decisions to make for ecommerce businesses. Both platforms offer powerful ecommerce features that help online businesses thrive in such a competitive market.
Choosing the right option for your business depends on your business model, business goals, and your area of expertise. We’re going to help you understand the differences between the two so you can make an informed decision.
Let’s dive in!
Shopify vs. Amazon: Overview
Shopify is an ecommerce platform, and Amazon is an online marketplace. What does that mean? Essentially, Shopify allows you to build your own branded online store, whereas Amazon is the online store that sells hundreds of thousands of different brands.
Shopify isn’t just a marketplace that allows you to establish your online store. It offers you an effective ecommerce-focused content management system with a variety of features. Shopify is a superior option if you’re looking to build a standalone, brandable online store that you’ll have ultimate control over. It also works best if you’re looking to start dropshipping.
Amazon also makes it extremely easy for you to establish your online store as it’s a one-stop solution for ecommerce. Amazon is superior in the way it gives you access to a large pool of established online shoppers that you don’t have to go looking for.
What is Shopify?
Shopify is a well-known ecommerce website builder that helps online sellers build their online stores or sell products from social media platforms or third-party marketplaces.
So who is Shopify for? Shopify caters to sellers of all sizes, including those who sell online, in-person, or both. It’s considered the best option for small businesses and startups because of its simplicity. The platform is a cloud-based system that you can use in any country. The easy-to-use interface means that you don’t have to worry about having the necessary coding skills to get started building a website for your ecommerce business.
Shopify is a great option for businesses who are looking for an all-in-one comprehensive ecommerce solution. It comes with useful in-built SEO and marketing capabilities and provides payment processing, inventory management, and shipping discounts. What makes this even more impressive is that you can access them from one single dashboard.
Pros & Cons of Shopify
Now let’s acknowledge the different pros and cons of using an all-in-one ecommerce platform like Shopify.
- Shopify caters to sellers who have a physical store, are drop shippers, sell wholesale, or even B2B products. All you need to do is specify the type of products you wish to sell.
- Shopify offers a variety of attractive storefront themes–for different industry categories–to help you retain customers.
- All businesses don’t have to sell directly through the platform. You can sell through blogs, social media sites, websites, or email so that you can reach your customers from anywhere.
- Shopify’s App Store is recognized as one of the most helpful ecommerce solutions online because you can find a multitude of compatible third-party apps to connect to your store.
- Free customization templates are limited to only 10 options, so you’ll need to pay a fee to use other options.
- Sellers need to purchase a custom domain if they don’t already have one
- Every sale you make on Shopify incurs a transaction fee, particularly when you use third-party payment gateways.
What is Amazon?
Amazon is currently the world’s largest ecommerce marketplace that boasts over 300 million active customers globally. It’s a thriving marketplace that’s also fairly easy to get started with. When a seller lists their products on Amazon, they can easily achieve credibility and trust because Amazon is popular for its reliable service.
So who is Amazon for? Amazon is for business owners who’re looking to open an online store that places their products in front of target customers. Unlike Shopify, when customers go on Amazon, they don’t usually search for specific stores but rather specific products. So, it’s much easier for you to be discovered on this platform. Sellers can guarantee to acquire repeat customers if they make sure they deliver top service to their customers. One way that Amazon helps you do this is with their Amazon FBA service, which we’ll dive into some detail about further in this comparison guide.
Pros & Cons of Amazon
Now let’s acknowledge the different pros and cons of using an all-in-one ecommerce platform like Amazon.
- Amazon is a ready-made marketplace with established customers so you can start selling without thinking of high marketing costs.
- The platform works as its own search engine, so customers don’t have to know your store name to find your products.
- Amazon offers marketing services to optimize your store listings and advertise to your target customers.
- Amazon ships products to over 100 countries, allowing you to reach a much wider customer base.
- Amazon has strict rules and guidelines to follow.
- Much higher fees than other ecommerce options.
- While the customers are already there, selling on Amazon can prove to be more competitive.
The Key Differences Between Shopify & Amazon
Ease of Use
Shopify: Shopify gives their sellers the opportunity to increase their sales without having to be overwhelmed by technology and other tedious admin tasks. The interface is quite user-friendly, and the platform will provide you with suitable onboarding steps to help you get started with selling. It’s a great option if you’re not so tech-savvy. However, you should be prepared to customize your themes and create your landing pages.
Amazon: While Amazon also provides you with helpful steps on how you can get started, Amazon requires you to learn how to use their database “Amazon Seller Central.” New sellers on Amazon can often face challenges in making sure they meet the requirements when it comes to your product names, product details, and catalog numbers for your listings. However, such strict guidelines shouldn’t be surprising since Amazon needs to make sure all product listings are authentic to maintain its credibility.
Ease of Marketing & Getting Sales
Shopify: Shopify does a great job of helping you create landing pages and syncing your various marketing campaigns with your store. You’ll also be able to create store credits, coupon codes, and exclusive discounts to attract more customers.
Not all of these tools are available as the default option, however. To access these advanced tools, you’ll need to peruse the Shopify store to find the right apps for your marketing needs. \
Amazon: Amazon has millions of customers visiting the platform monthly, so your store can achieve high visibility without much marketing on your part. Since there’s already an established–and growing–customer base, you can be sure to launch into sales from the first day.
Probably the most important criteria to consider are Shopify and Amazon’s different ecommerce features because these can help you determine which platform is right for you.
Here are Shopify’s top, built-in ecommerce features:
- Shopify product management: Shopify allows you to add new products to your listings via your back-end interface or import CSV files. Unlike Amazon, filling in your product information is not so rigid, and you can also assign your own product categories.
- Inventory tracking system: This feature helps you track when you’re running out of stock, so you can avoid selling out.
- Abandoned cart recovery: This useful feature gives you insights as to why customers didn’t follow through with a purchase so that you can reach them through email.
Here are Amazon’s top ecommerce features:
- Convenient product management: To add new products individually, Amazon offers an interactive listing tool. Additionally, if you need to add multiple products at a time, you’ll have access to Inventory File Templates that you can easily edit from Excel.
- Amazon FBA: Amazon offers a premium service called Fulfillment by Amazon (FBA) that helps you with storing, packaging, shipping, and managing customer support for your products. Although you’ll incur additional fees for this service, it’s extremely reliable for getting your products shipped as fast as possible and handling logistics so that you can focus on other aspects of your business.
- Seller Central Language Switcher: This feature allows you to support other languages, such as German, French, Italian, Spanish, and Japanese for your product listings and fulfillment. Essentially, making selling globally a bit more seamless.
Payment Options & Fees
Shopify: When it comes to payment processors, Shopify offers multiple, including third-party integrations you can purchase from the Shopify App Store. This makes it extremely easy for you to process your transactions directly from your store domain and allows you to offer your services to global customers. You won’t find any additional fees if you use the Shopify Pay feature. However, a transaction fee will be charged for every order placed using third-party payment options.
Shopify’s pricing plans start at $29/month for the Basic plan, $79/month for the standard Shopify plan, and $299/month for the Advanced Shopify plan.
Amazon: Amazon charges a fee of $0.99 per unit sold. Additionally, sellers can expect to incur high transaction fees that range from 8% to 45%, depending on your product category. So, in terms of pricing, it’s quite clear that Amazon can be more expensive. However, this is expected because you are guaranteed customers.
Ultimately, Shopify and Amazon both bring useful strengths for ecommerce merchants. If you’re willing to handle your own marketing and are looking for reasonable fees, Shopify is a clear winner for you. On the other hand, if you’re willing to pay higher fees to get your products in front of already established customers, Amazon is for you. It all depends on your business goals and how much flexibility and control you desire.
The best part is that, if your budget allows, you don’t have to choose between Shopify or Amazon. These two powerful platforms can be used in conjunction with each other if you have the means to maximize your sales.
Choosing the right ecommerce platform isn’t enough; you’ll also need tools that can help you optimize your customer base. Upscribe is a great tool that helps you make the most of your subscriber revenues by tapping into the full value of your Shopify customers. It’s easy to set up and works seamlessly with your store in minutes. Want to see how it works? Schedule a demo and discover how you can secure repeat customers with a comprehensive subscription service.