Why Shopify is the best? let’s understand its business model!

Do you want to know all about the Shopify business structure? If the answer is yes, then you’re definitely at the right place.

Probably Shopify is the first name that crosses the mind of everybody when they think about starting an eCommerce business. It is a very convenient option for newbies and rookies. Having an online store is not a big task today; almost anybody can set up their stores in no matter of time.

Gone are those days when starting a business was a daunting process. Today, you can start running your own store in this digitalization era even if you have a limited budget. That is only possible because of eCommerce platforms like Shopify. But still, there are many more competitors such as BigCommerce, Magento available in the market, but our focus is on Shopify.

Now the question must be why Shopify?. It is popular among users; around 1 million merchants use the platform to sell goods. So why not!

Here in the article, we will discuss how Shopify works and helps other eCommerce businesses by making itself a nice fat profit.

So without wasting any more time, let’s dip our toes to know more about Shopify’s business model.

What is Shopify?

What is Shopify

Shopify is an internet service that makes it simpler for consumers to build eCommerce businesses by giving all of the essential tools. Shopify’s user interface is pretty straightforward and intuitive, allowing sellers and marketers to build knowledgeable online businesses without prior expertise or technical skills.

In other words, it’s an eCommerce store builder that handles all the moving parts of an online store like web hosting, domain name registration, assisting with the speedy setup of an online marketplace, keeping track of inventory, and order management system. Besides this, Shopify also provides the flexibility for users to personalize their online businesses.

With more than 20% market share, it is among the most trusted online platform on the globe right now.

What does Shopify bring to the table?

Everybody knows the power of the internet and how it is crucial to make a robust online presence and stand out in the crowd these days. Running a business is one thing but making it visible among customers is another. Sure does Shopify helps you with that as it provides you with the online presence that you need.

Shopify is an excellent choice for retailers who are looking to start their own online business or wanna transform an established physical shop into an internet shop. Thus to make it comprehensive, it enables you to sell a wide range of items, including apparel, electronics, and home items, while also catering to your specific needs.

In addition, it also spares you from the mechanics of operating an internet business, which means the platform thoroughly helps you to concentrate solely on marketing, customer services, and brand management

However, many physical shop owners are scared of the online world because they think it requires a lot of time and skills to take off. But on the contrary, establishing an online store is much easier than building a physical store. Therefore here we are going to cast light on why Shopify is the best solution for business owners

1. Quick Setup – The very feature which makes users compelled to buy Shopify is its easy installation and setup and that too without any technical expertise. Shopify looks after all the technical processes and makes it easier for you to start and run an online store.

Easy and Quick Shopify Store Setup

It has a drag and drop builder, using which one can customize its store within minutes. Shopify offers a wide range of eCommerce web options. This provides the ability to design a site with over 70 designs and 50 languages to select from. Each one of the pre-designed designs may also be further adjusted to meet your specific needs.

Not just this, you can list as many as possible products on your store; Shopify puts no limit. Aside from these, you may pick from over 100 payment methods, all of which are entirely free or have low fees. Shopify Payments has its own payment processor as well. Because customers may choose from a variety of payment choices irrespective of region.

Therefore due to such easy set-up of websites, products, and payments makes Shopify a note worthy platform for new eCommerce businesses.

2. Easy to Manage – After setting up the store, many people face challenges while managing it, but Shopify pays attention to it as it makes the management of the store, look like a walk in the park and there are ‘n’ no. of ways through which Shopify does this.

Like Shopify offers complete access to CSS and HTML files, and this allows users to customize the site to their desire. However, if we move towards order management and shipping, the shipping rates can be calculated automatically depending on parameters such as geography or delivery priority which also could easily be inputted inside the dashboard.

Shopify's easy to manage system

Not just this, it has an abandoned cart notification feature that allows owners to send messages to their customers who haven’t made the purchase. Thus making it easy to grab potentially lost consumers. Therefore it manages your abandoned customers as well.

In addition raise in orders makes Ecommerce owners understand the pain of handling taxes based on different countries and regions, and that’s why Shopify allows their users to easily extract their taxes that apply depending on a client’s nationality or state. Also, the store owners can manage their entire store from any mobile or tablet without any difficulty.

3. Store Management Features – Shopify does everything to double-up your revenue by offering store management features such as customer profiles, dropshipping plugins, email templates, and much more. Such features are really helpful, for example, customer profiles could let you reach consumers individually with special offers, new product announcements, and other information while targetting them.

As a result, your sales may increase. Therefore instead of having to handle everything by yourself, you may want to have Shopify manage some processes like the fulfillment of purchases, inventory storing, packing, and shipping. On the other hand, Shopify also allows users to collaborate with fulfillment services like Amazon and eBay. Further, order returns and reimbursements of items may also be handled via Shopify, which will instantly adjust your inventory stock and finances.

4. SEO and Marketing to Enhance Sales – The one who owns the full-fledged eCommerce store will only understand the importance of SEO and marketing. Today Seo is the strongest pillar of every store and without proper SEO, you can’t make your store rank on top pages, which inherently will results in no sales and hence the flop show. And we know nobody wants to be a flop show.

Shopify's Marketing and Sales

To help users with this, Shopify provides SEO solutions, such as optimizing web page titles and meta tags. It also provides several plugins, such as Plugin SEO, SEO Plus, and SEO Booster, that will help you to grow your SEO score by addressing the issues on the site. In addition, sitemap.xml which is an important file for indexing can also be generated automatically for items and articles.

Aside from that, Shopify boasts lightning-quick loading and response speeds. Thus making your site speed optimized means your store complies with the good web core vitals.

Besides SEO, you can integrate your complete marketing from ads to email within Shopify to create, run, and track everything from your paid marketing campaigns. Thus making Shopify a one place destination for marketing and promotions.

5. Exceptional Security – Security of the store is everybody’s first concern as we witness cases of security and data breaches daily. Although nobody wants their customer details out in the market without their permission and Shopify understands this, hence it offers top-notch security.

Shopify manages all of the necessary procedures to secure details of customers, as well as any alleged breaches. Shopify is equipped with a new 256-bit SSL certificate and it is PCI-DSS compliant to receive credit or debit card payments. Also, Shopify complies with PCI Level 1 requirements too.

Which guarantees security from attackers, ensures all stored data, and aids in the business’s search engine optimization.

SSL certificate is essential because it adds value to the site’s authenticity. Google considers SSL certificates seriously as it demonstrates that the consumer’s data is secure and thus places such sites better in search results.

Besides search engines, it mostly comes down to users who should feel more comfortable while surfing your store and in that case, Shopify does help you gain your user’s trust for security.

6. Top-notch support – Lastly, customer support is vital to run your store. Many users who run stores come across certain kinds of technical problems and issues which are hard to deal with on their own.

Hence it is crucial to reach out to the support for such cases, but many Saas-based services failed to deliver quality service, but Shopify is exceptionally good. Here users can access the assistance 24 hours a day, 7 days a week. Also as a user you can contact their team through phone, email, or live chat at any moment.

Shopify’s support also provides guidelines, lessons, and FAQs. They also offer a Shopify Professionals team of experienced engineers, developers, and advisors to deal with its customers. Shopify organizes its experts into categories based on costs and expertise so that users may find the most superior fit for them.

What is Shopify’s Business Model? How do they Earn Money?

Now proceeding to the most crucial viewpoint, how does Shopify make Money? This is the question that pops into people’s heads. To understand, we must know the answer to how does Shopify works.

So let’s put a light on the Shopify business model and its work, which is responsible for Shopify’s revenue every year. But before moving further, let’s know about their business model first.

Shopify was first launched to offer services to medium and small shop owners to run and start their business online in no matter of time. It works on a SaaS-based business model where they rent spaces to their clients out and anyone can create their digital storefront with this eCommerce software. Besides a platform to develop it also provides other services, such as point-of-sale systems, domain registration, SEO tools, and much more.

Small and medium-sized enterprises make up the majority of Shopify’s clientele.

Currently, Shopify has three subscription plans which are Basic Shopify, Shopify, and Advanced. Mostly all of these plans come with a 14-day free trial and Shopify earns its money from these subscription services. Medium and small businesses that utilize Shopify to establish, expand, and maintain their eCommerce stores are charged a monthly membership fee. For large enterprises, it has a Shopify Plus plan which is a service intended for significant business clients, and it is in charge of pushing sales on the platform.

Shopify PlansMonthly Pricing
Basic$29
Shopify$79
Advanced Shopify$299
Shopify Plus$2000 or more

Shopify describes its framework as a cloud-based system with scalability, stability, security, and fantastic performance for numerous users.

  • The working of the Shopify model involves users to Signup to the store
  • They endeavor a 14-day free trial which is enough to make clients understand all about the platform.
  • For accessing the 14 days, trial period users don’t need to pay any fees.
  • Once the trial is finished, Shopify will ask you to choose a plan based on your needs for which you would make a payment as an eCommerce owner because Shopify offers flexibility to upgrade or downgrade plans at any time.

In addition, they do provide merchant services such as transactions, delivery, and financial services but the majority of these packaged merchant services are compensated on a scale basis but still, subscription businesses bring in large chunks of money. Thus helping Shopify to become a stand out billion-dollar brand.

Conclusion

That’s all! This is my complete take on the Shopify business model as a Saas-based model which is a magic wand for small or medium-sized businesses who want to operate an eCommerce business today.

Over a decade, Shopify has been helping many companies out there with their platform and certainly, it has made the online digital store process really smooth allowing people to generate more and more sales without much hassle. 

So what are you waiting for? Go and try Shopify out and let me know all about your experience in the comments section.


Vignesh Wadarajan

I am Vignesh Wadarajan, a tech buff, sports enthusiast and adreneline junkie. I started my own company when I was 18 years of age, Jankosoft, a web and mobile application development firm in 2001.