Shopify vs. Amazon - Where Should You Sell Online?
As an online business owner, a decision that you need to make right at the beginning is choosing where to sell your goods online. In the eCommerce world, two big names offer big opportunities for merchants that you are most likely going to end up using, which are Shopify and Amazon.
Both platforms offer excellent eCommerce solutions and have high popularity. Shopify has reached one million merchants in 2019, while Amazon’s is believed to have more than two million sellers. These platforms have great potential for exposure and profit, but the benefits and challenges of selling through them are different. To choose the one that suits best for your products and selling method, read this article to find out.
In this, we are going to review all the major features, pros & cons, pricing, ease of use, and more of the two eCommerce platforms. We will also show you how to combine the two platforms if you wish to know. Our goal is to give you a better understanding and decision of whether Shopify vs. Amazon (or both) is where you want to sell your products.
Table of content:
- What is Shopify?
- What is Amazon?
- Shopify and Amazon main difference
- Pros & Cons of Shopify and Amazon
- Shopify vs. Amazon
- Sell on Amazon using Shopify
- Shopify vs. Amazon: Who is the winner?
Shopify is an all-in-one cloud-based eCommerce solution that can help users build, customize, and fully manage their unique online stores. It is used by many large companies such as Tesla, Kylie Cosmetics, Budweiser, or Nestle, but the platform’s basic service is great for small businesses with few people too.
If you sign up and account and pay a monthly fee, you get access to all eCommerce functions like inventory management, payment acceptance, and shipping in just one single dashboard. “Cloud-based” means that it is a hosted platform, and you won’t have to worry about buying service from a third party hosting provider.
Shopify also has a theme and app store, where you can choose from over 70 professional designed templates and thousands of compatible apps. If you need to sell your products in a physical location, Shopify POS is available to provide point-of-sale hardware.
With an eCommerce-centric approach, Shopify is built to make online selling easier for everyone.
What is Amazon?
You probably have heard of the largest online retailer in the world, created by Jeff Bezos - the richest man on earth. Amazon is a marketplace that can give you instant access to millions of buyers around the world. You can sell on the site as an individual or a professional, and there are several options for shipping.
Amazon is an incredibly useful place for new or very small businesses that don’t have enough budget or resources to create a stand-alone online store to have a customer base. It is also equally valuable for established businesses as a side revenue stream and a channel to redirect customers back to their dedicated online stores.
Setting up a seller profile and listing products is quite straightforward, but you have to make sure you follow Amazon’s rules and regulations to avoid being banned. One more major bonus of using Amazon is Fulfillment by Amazon (FBA) - which stores your inventory, handles packaging, and ships your store’s orders.
For eCommerce, Amazon is a marketplace that every seller can learn and use to earn more profit.
Shopify and Amazon main difference
The first thing to be clear of, Shopify and Amazon are not the same; they work in different ways and have unique working methods. While Shopify is a specialized eCommerce platform, Amazon is an online marketplace. Shopify provides the tools to build a stand-alone online store, and Amazon lets you sell your products alongside other sellers on the marketplace.
Imagine selling through Amazon, like having a booth at a famous fair. Millions of people walk by to browse and buy. Your business’s products may not be what they are particularly looking for, but you still make sales because everyone can see what you have to offer. Every booth seems quite similar; only small details like banners and colors are different.
Selling with Shopify is like renting a place to set up your business. You have your own space to showcase your products and customers who know about your brand come looking for your store. You are free to create your own unique image, but it is harder to build up a customer base.
Because of these differences, Shopify vs. Amazon returns different results for online sellers. Keep reading on to learn about these traits of the two platforms.
Pros and Cons of Shopify and Amazon
Understanding the difference takes us to weigh the pros and cons of Shopify vs. Amazon. This is to decide if you want to establish a digital presence on either of these platforms. Your growth strategy will play a significant role in this decision.
|Pros||- Many powerful eCommerce tools to help you build and promote an online store.
- A stand-alone eCommerce store makes a strong and unique brand to accompany your business.
- Services are available for many types and sizes of business, from small, large, to online and offline.
|- Millions of people visiting the marketplace per month give your products great exposure.
- Extra services like inventory storage, packaging, and shipping make it easier to run a business.
|Cons||- Extra cost of the monthly fee, transaction fee, and third-party apps (if you choose paid ones)
- Marketing and promoting your business is fully your responsibility to build a customer base
|- Competition is fierce, with a ton of competition. You may even have to compete with Amazon itself.
- It is difficult to create a unique brand image by selling on Amazon.
- You don’t own the platform you are selling. If Amazon decided to close your account, there wasn’t much you could do. And this actually happened.
Shopify vs. Amazon
In this section, we are going to look at all the major factors that are essential to a successful eCommerce business, which is provided by Shopify and Amazon. Let’s get started.
Shopify vs. Amazon: How to use
Whether you’re selling just a pair of socks or building up your eCommerce empire, you want an online selling experience that is as smooth as possible. If you think setting up everything for your online store is too much, then you haven’t used Shopify. The platform is designed to make building an eCommerce website easy like drawing in crayons. You got a clean, clear design, super easy navigation, and tons of help pages.
Shopify is amazing at making powerful sales tools accessible to every merchant. With a centric approach to eCommerce, Shopify deserves credit for making selling online way more easily.
With Amazon, all you need to do is sign up for an account, complete all set-up stages, and you are ready to start selling. Once you’ve registered, you can list your products, sell them on the site, ship to customers, and get paid right on a single website. The getting paid part is the best part.
This a straightforward process that Amazon also has more tools to help the process simpler. You can sort out shipping yourself or try Fulfillment by Amazon (FBA). This reduces one of the toughest parts of selling online - shipping, so you don’t have to worry about it if you have the budget. Instead, you let Amazon sort the process for you.
Both Shopify and Amazon are designed to make eCommerce as easy as possible with many useful tools to streamline the work process. So, it is a draw; each platform is easy to use in its own way. Amazon involves less work to start selling, but Shopify makes it easy to build your own online store.
Shopify vs Amazon: Pricing
With any platform, you want to be making more money than you’re spending. Under no circumstances should you choose something that cost you hundreds of dollars just to sell a few items at $9.99 per month. Shopify vs. Amazon on pricing is a tough battle since both are not pricey and can fit any budget.
Amazon has too pricing plans:
- The Individual Selling plan has no monthly fee, but you pay $0.99 per item sold. There are also extra selling fees, which are determined by the category of the products you are selling.
- The Professional Selling plan is $39.99 per month, no fee per item sold, plus extra selling fees as well.
The Individual plan is good for any store that sells less than 40 items per month since it has fewer features and costs only when you make sales. The Professional plan lets you access order reports, earn top placement on product detail pages, add 10+ additional categories, and customize shipping rates.
Using FBS would cost more for both plans, but it has a flexible pricing structure depending on your products and business.
- The Basic Shopify plan is $29 per month
- The Shopify plan is $79 per month
- The Advanced Shopify plan is $299 per month
The higher pricing plans, the more features you can get. When you sign up for a year, you save 10% on the subscription fees, and if you sign up for two years, you save 20%. The Basic Shopify plan already gives you everything you need to set up an eCommerce business, you can add apps to expand functions, and upgrade to higher plans when you are ready.
There are also Shopify Lite to connect your existing site with Facebook and use Shopify features at $9/month, or Shopify Plus for enterprise with special pricing. Extra costs can occur when adding third-party apps with any pricing plans. If the apps help you scale your business and reflect rise in customers or profit, you should still use them.
In the term of pricing, Shopify wins with the value for money for many sizes of businesses. It can be cheaper than Amazon’s Professional plan and is transparent with the pricing, making it easier for you to calculate budget.
Shopify vs Amazon: Store Design
Bad design affects a store’s sales directly. If it is frustrating to click on any part of the website, a visitor may leave even before taking a glance at your products. So, obviously, if you have the freedom to design your website more appealing, customers tend to stay longer and purchase more.
Shopify gives you a lot of control over the layout and design of your online store. But you don’t have to do it from scratch, you have over 70 themes to choose from on the Shopify Theme store and customize to match your brand. There are 8 free themes and 64 premium themes which cost between $140 and $180. You can edit, personalize, and switch the store’s themes if you would like to create a unique brand image.
Amazon has more limits in designing a store. All Amazon stores are laid out in a similar way with banners and product placement. You can upload images and add description, but the overall layout is recognizable as an Amazon store, not a stand-alone store. On the homepage, products are listed in image blocks. This is ideal for customers, but it can be challenging to direct visitors to your one website.
Amazon does have elements that you can customize to make your stores look better. But overall, it is much less flexible than what Shopify has to offer. So, in the term of store design, Shopify wins. Its customization is great to create a unique brand image and maximize the marketing potential of a website.
Shopify vs Amazon: Payment methods
The upfront cost is often not the only fee that you have to pay. There are also transaction fees and credit card rates, which are affected by the payment methods that the platform provides. These can increase your monthly budget, so check before committing.
Amazon supports Amazon Pay as the main payment method. You can still accept credit and debit cards, but PayPal is not allowed. If you use FBA, fees would vary from $2.41 to $137.32 for fulfillment fees based on the type of product. There are also monthly inventory storage fees which are from $0.69 to $2.40 for each cubic foot. The prices change based on size, volume, product type, and time of the year.
Shopify also has its own payment gateway - Shopify Payments. If you use this method, no transaction fees would be included. However, it is only available in certain countries. Besides that, Shopify provides over 100 different payment gateways, including PayPal and Amazon Pay. These have transaction fees between 0.5% to 2% based on your pricing plan.
Credit card fees, however, apply to all payment gateways, even Shopify Payments. Regular credit card rate on Shopify is 2.9% + 30¢ for Basic Shopify, 2.6% + 30¢ for Shopify, and 2.4% + 30¢ for Advanced Shopify. In-person credit card rate is lower for all plans, starting at 2.7% for Basic Shopify.
In the term of payment methods, Shopify wins with more payment options and transparent fees for each level. Amazon’s fees can change without warning and make budgeting harder for store owners.
Shopify vs Amazon: Customers
Online sellers always meet the trouble of attracting customers. With the distraction, competition, and other cool things on the internet trying to win one’s attention, it is a brutal race just to get noticed by a visitor for five seconds. After that, you need a good way to connect and keep the relationship too.
With hundreds of millions of visitors per month, Amazon shines when coming to getting customers. You don’t have to practice search engine optimization or run email campaigns, visitors on Amazon already have their wallets primed to buy something they like. This way, you have more time to manage the inventory, process orders, and take care of customers. Your customers are already coming to your doorway.
That doesn’t mean it is easy to get sales though. You still have to compete with your neighbor’s products, because visitors can see them too. And even Amazon is selling on the platform, so beware of that super big neighbor. You also need to comply with Amazon’s SEO to rank high in the search results, this gives you more chances to be chosen over the competitors.
For Shopify, you create your own address, so people actually need to search for your business to know you exist. This means marketing is essential, and without good strategy, it is hard to get the same search volume as Amazon. You need to master SEO, social media marketing, multichannel selling, email campaigns, abandoned cart recovery, and customer shopping experience to grow your brand.
Luckily, you get a lot of help from Shopify. There are already marketing tools available and more to find on the Shopify App Store. There is also 24/7 support and community groups to get your problems consulted.
However, in terms of customers, Amazon is the winner. The platform’s massive customer base brings customers to you, and your products get more exposure. Even though you can’t sit back and relax, you don’t have to start getting visitors from zero like Shopify’s approach.
Shopify vs Amazon: Support
When you start using a new platform, the help you get is also essential to your work process, especially when unexpected events happen, such as a pandemic like right now.
Amazon isn’t really famous for its support system. There is a phone support number that you can request a call, and someone would get in touch with you. There are also forms that you can submit and community forums where you can discuss with other sellers. But it is not exactly an easy to use support system, having frequent feedback of late response and doubtful decisions.
On the other hand, Shopify has a comprehensive support system, including 24/7 phone, live chat, social media, forum, email, specialist support, and video tutorials. This can cover almost everything you need and help you learn new skills. If you need help right the way, just pick up the phone. There is also a Help Center with articles and guides that you can navigate easily through tons of resources to find solutions.
So, in terms of support, Shopify is the obvious winner. It is much easier and you have many more help options to choose from. Amazon does offer support, but it is far as friendly as what Shopify offers.
Sell on Amazon using Shopify
If you want to get the best of both worlds, why not integrate Amazon into Shopify? Afterall, they are pretty well-matched. Just like bread and butter, they actually can work together to make something great, for instance, your store.
You can build your own eCommerce business on Shopify and promote your products on the world’s largest marketplace with just a few clicks. Through an app called Amazon channel created by Shopfiy, you can create Amazon listings straight from your store, sync inventory, product details, link different products, and more.
All you need is an Amazon Seller account and add the Amazon Sales channel to your Shopify store. There are still costs for Amazon Professional Seller account and external charges by Amazon, so you have to pay for two platforms at once. But if you are ready for more exposure and expansion, using these two powerhouses at the same time is a good investment.
One more thing you should keep in mind is that the app is not receiving well reviews from Shopify stores. But it is free to install, so you might just give it a try and see what brings.
Shopify vs. Amazon: Who is the winner?
Shopify vs. Amazon is the battle between two impressive sales platforms. They are different in features, design, pricing, and more, and each can help you in its own way. Overall, I still recommend Shopify as the stronger solution for anyone starting an eCommerce business. It gives you control power, scalability, and a stronger brand identity for the long run.
If you are a small business owner who doesn’t want to pay an upfront cost, you can use Amazon, but the extra fees are difficult to judge and estimate. You can also integrate Amazon into Shopify for a win-win store, but it is entirely up to you to do that.
Both platforms have different pros and cons, but they are all powerful and can help set up a successful eCommerce business. Ultimately, you will have to make a decision about whether Shopify or Amazon is the right choice for your store. But you don’t have to rush, take time reviewing all the points listed in this article, align them with your strategy, and ask for advice from other business owners.
If you have any questions, I’m always ready to answer in the comments section, so let me know your thoughts. And as always, best of luck on your eCommerce journey!
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