Amazon is home to 1.9 million active sellers, and Shopify hosts over 4 million stores. eCommerce business owners already know a lot about these channels: they're popular among business owners, so they're popular among shoppers; there's a lot of business activity, but that means competition. However, these numbers need to tell you which channel is the perfect fit for your eCommerce business.
While Shopify and Amazon aren't necessarily incompatible, most companies prioritize one over the other due to exclusivity clauses, limited resources, or simple opportunity costs. Making the correct choice (and sticking with it) is crucial for any business, especially if your niche has a lot of overhead. In this guide, we'll get to the bottom of which channel is a better choice, which businesses benefit most from either channel and what factors you need to consider when making your final choice.
eCommerce Businesses Get Results With Both Shopify; and Amazon
If you're reading this article, you already know what Shopify and Amazon are, but examining a few core differences can help you view them more strategically:
- Shopify is an eCommerce platform. It will integrate with your website and give it business-related functionalities: checkout tools, shipping integrations, marketing, etc. Shoppers aren't going to shopify.com and searching for products they're interested in. Instead, they’re searching storefronts hosted on the Shopify platform.
- Amazon is an online marketplace where shoppers search for products; it won't integrate with your website in any authentic fashion beyond embedded links to product pages.
Based on this perspective of each business's core functionalities, eCommerce business owners can already see the best path for them: are you looking for tools that enable your business, or are you looking for a place to do business?
Who Excels on Amazon?
New eCommerce businesses that excel on Amazon are the ones that offer products where brand loyalty matters less. Shoppers are looking for goods — electronics, cameras, books, clothing, personal care items, and home and kitchen goods (in that order) based on a recent list of top-performing categories — that fulfill a need. They may care about quality, speed, or specific features but aren't tied to a particular product or brand. Get your products on the first page, ensure fast delivery, and keep up with Amazon's changing paradigms.
Ultimately, Amazon works well If you have very little capital, want to focus on Amazon SEO and fulfillment, and don't produce your products.
Who Excels on Shopify?
On the other hand, Shopify serves business owners with a more comprehensive vision of what running a business entails: marketing, creating, selling, providing customer service, etc. With Shopify's platform and integrations, your business is more in your hands, and you can choose your website, product descriptions, customer service policies, and even shipping partners. If this is you, Shopify is the better fit.
Just like with Amazon, particular niches do better on Shopify. Top performers include travel accessories, personal care items, eco-friendly and vegan items, luxury pet goods, and fitness gear—i.e., products that offer customers a luxury, boutique feel. These shoppers want a lovely shopping experience, not just a convenient one, so you need to retain as much control as possible to cater to these markets.
Related: Understanding Shopify eCommerce Analytics
Shopify vs. Amazon: Which One Is the Best Fit for Your Business?
Do a quick gut check before we look at the two platforms in more depth:
- Are you here to create a brand and build a business (with everything that entails)? You're destined for Shopify.
- Do you want to focus on marketing and sales, but you're not tied to a specific brand vision? Get a crash course on Amazon.
Keep your answer in the back of your mind as we explore the different aspects of both Shopify and Amazon. Along with that intuitive grasp of what you want your business to be, it's also important to gauge each of these following aspects by what you wish your daily work hours to look like, what your long-term plans are, and what you as the business owner want to own at the end of the day.
Storefront: Build Your Empire vs. a Pre-Built Store
When you run your business via your own website, you have a blank slate for designing your online eCommerce storefront. You decide if there's a business blog, the product page layout, whether there's a product configuration tool for custom goods, and how the purchase process looks. Shopify supports your storefront with different integrations and widgets that enable a smooth checkout process, provide point-of-sale functionality, and help you plot the course from "Buy now" to "delivery complete." You can pick from different options along the way, so you custom-craft the user experience.
However, this freedom also means the website hosting costs, security, customer service, and other operational aspects are all your responsibility.
On the other hand, Amazon offers a pre-built store (that looks like everyone else's). You can personalize the images, products, product descriptions, and inserts. But Amazon gives you a rigid structure of how your business will operate, sets your responsibilities for timely order fulfillment, and either punishes or rewards your store based on customer ratings and complaints.
To put this in perspective, running your Amazon store is like running a franchise: some things are more manageable, but you must follow the rules to keep your store.
Ease of Use: Both Platforms Facilitate Easy eCommerce Management
Both platforms do remarkably well regarding ease of use and implementation. Because they're both so popular, they offer a wealth of resources (both directly from the companies and community-created). The steps are also relatively straightforward to get started. However, Shopify edges ahead in intuitive user experience. Because you're Shopify's customer, the dashboard, support resources, and widgets are more nicely packaged and easy to work with.
But if "ease of use" means "less work," Amazon offers greater convenience. The setup is faster, and you can load products to the marketplace as soon as you have the details. Because the shopping cart, purchase, and delivery processes all follow Amazon's standard formats, you don't have much work to do here. On the other hand, Shopify requires more work upfront to ensure the integrations work seamlessly and all the pieces fall into place.
Related: Amazon FBA Profitable? A Quick Guide to Find Out
Audience: Express Entry to a Crowded Marketplace vs. Building Your Base
Amazon is a crowded, booming marketplace, and that crowd is full of buyers and sellers. According to a recent assessment of the company's marketshare, "Amazon will account for nearly $2 in $5 spent online in 2022, making up 39.5% of all US retail eCommerce sales." They also record a staggering 2 billion visits from US shoppers each month. When you sell on Amazon, you know consumers are constantly flooding the marketplace. Not only do shoppers search Amazon itself, but the site links regularly hold the top spots for product searches on general search engines. While you need to know how to get in front of the competition, you can be sure of the strength of your market.
There’s also an advantage for dropshippers: Amazon offers an abundance of insight into how specific products rank in sales, how other businesses are doing to be prominent in search results, and additional vital insights. Shopify and the broader online market offer a different knowledge base.
Shopify; is different: it doesn't bring a large swath of online shoppers with it. Instead, it offers integrations that help you bring in traffic. The site also gives you more ownership of your customer base. Because its integrations exist on your website, you ultimately "own" the data regarding subscribers, customers, buying habits, and contact information. You can create more nuanced marketing campaigns, control communications, and refine your audience. Their Shopify; Audiences integration makes conversions more efficient and helps you gauge prospects' interest levels.
Brand Reputation: What About When Things Go Wrong?
A great way to assess the value of any business tool is to imagine everything going catastrophically wrong. You ran out of inventory in the biggest shopping season of the year. A customer bought something expensive as a gift, and you sent the wrong item. Your fulfillment partner is ghosting you because they found bigger fish. Everyone is screaming at you, and you know you won't be making a profit today.
This is the scene, so where would you rather be: Shopify or Amazon?
Here, Shopify takes the cake. You simply have more options to right the wrongs. You can switch to another shipping partner when one starts feeling subpar. You have more freedom to send a furious customer replacement products, coupons, and heartfelt apologies. Also, while negative reviews are undoubtedly bad for business, they won't send your business to the back of product search results.
With Amazon, a bad day may be unrecoverable. You don't have a choice about shipping, but you will get the blame. If something goes wrong, Amazon may send the customer a free replacement product and charge you for it without your say-so. Negative engagement sinks your storefront in the listings. This isn't out of malice. Amazon is simply interested in efficient, effective sales—whether they're your efficient, effective sales or not.
What You Sell: Products vs. Anything You Want
One final aspect to consider for your online store is this: what do you want to sell? Boutique, custom-made goods sell better on Etsy and business-owned websites. You can't sell subscription boxes on Amazon (though your products may qualify for the Subscribe and Save program). You can't sell services, merch, or anything outside the conventional 'consumer or business good' category. If you want to branch out or enjoy creating your products, Shopify allows you to expand your product lines more diversely.
However, if you're in the business of sales rather than production, Amazon can be a great fit. If you love finding the hottest product types, crafting compelling copy to make shoppers add your products to their carts, and then finding the next hottest thing, an Amazon storefront lets you do precisely that.
The Bottom Line on Shopify vs. Amazon: Decide Your Business Objectives
Both Shopify and Amazon are solid options for any business. They're enabling millions of small business owners to find shoppers, sell goods, and thrive in the modern eCommerce market. Which is the right fit for you ultimately depends on your business objectives: are you creating a brand, or do you just want to sell? Do you like freedom and risk, or are you comfortable playing in someone else's sandbox? Whichever path is the right choice for your business, we recommend you finalize your decision by:
- Picturing what the best day of your business looks like - what will your income look like?
- Imagining the worst day of your business - what are your options to right the wrongs?
- Deciding what you want your day-to-day responsibilities to be
- Determining how much of your business (contact details, processes, customer service, etc.) you want to stay in control of, now and the future
- Making sure you have the funds to ramp up and maintain your business
