To answer this question, we’ve performed some in-depth research. If you want to find out which platform is best for your store, keep reading.
Difference Between Amazon and Shopify Platforms
It’s best to start with understanding the general scope of each platform. Both platforms have consumer recognition, but how do you use them to sell?
What is Shopify?
Shopify is a platform built for standalone digital stores. Instead of having a storefront that promotes Shopify’s brand, your storefront is for you only.
No “website.shopify.com” nonsense; you just have yourbrand.com. Shopify appeals to sellers who already have experience in marketing and creating exposure for their business.
You create the storefront, listings, and download applications, much like building a WordPress site. Having your own storefront/website is pretty appealing.
What is Amazon Selling?
Unlike Shopify, Amazon’s name is behind all of the storefronts on its platform. This situation applies to both individual sellers and professional sellers, leaving the platform open to anyone.
Amazon doesn’t require you to have a business address; the company just wants you to stick to using its platform. If you are wondering where to start, Amazon provides an excellent eCommerce platform for beginners.
People often expand the comparison between the two platforms to include Shopify vs. Amazon FBA. FBA stands for Fulfillment By Amazon, enabling sellers to hand their storage and shipment efforts off Amazon.
Because of this, Amazon’s seller platform is suitable for individuals or one-person companies. The options are pretty limitless.
Pros and Cons of Selling on Each Platform
To help your decision-making process further, we’ve got a list of pros and cons for choosing each platform. Let’s check them out below:
Shopify enables its users to create a storefront. You don’t share the space with other business owners and website builders.
You are entitled to all traffic, and it doesn’t belong to Shopify.
As a result, you can design the website to be anything you want. While you should follow the best practices for building sites, your site can fit your style.
Because it is your website and store, you don’t have to adhere to any community guidelines. You can sell products that Amazon typically doesn’t allow or promote. So, if you want to sell custom swords, here’s your chance.
The result of selling on your own platform means that you do not have to share the space with others. As a result, you aren’t limited to selling items based on what Amazon sets as their product value.
Instead, you have greater control over setting prices. This means more potential money for items that have “low values” based on Amazon.
Shopify also integrates with Amazon using Multi-Channel Fulfillment (MCF). MCF enables you to keep your Shopify storefront while integrating your permitted stock with Amazon.
Despite what Shopify promoters would tell you, Shopify comes with some significant challenges. It is not the most beginner-friendly platform because of three different aspects.
First, owning your traffic means you will have to earn it. Earning that traffic can be done through a combination of Search Engine Optimization (SEO), pay-per-click (PPC), and other forms of advertising. If you don’t know how to market online, owning your own storefront is a challenge.
You will also need to be creative when it comes to building a long-term brand strategy. It doesn’t help to look like all of the other brands coming out of the Shopify platform. You need something that works, and making it up as you go along isn’t an option.
As a result of your independence, you have to pay for your own marketing. All forms of advertising have a cost, and as a storefront owner, that cost is in your hands. You have no starting traffic sources and no boosts from being recognized by Shopify.
It is all up to you.
The daunting task of running your own business is somewhat simplified when looking at Amazon. This is a result of having two of the most significant business issues being taken out of your hands.
First, the website you use to sell already has plenty of traffic. In that way, Amazon does a lot of the marketing for you. Granted, they also do the marketing for everyone else.
However, this simplifies your goals to focus more on the product and customer service aspects of your business. Taking the marketing out of your hands through simplified advertisement efforts is a nice change of pace.
Amazon Seller Central contains numerous tips and tricks about using Sponsored Products Advertising, Sponsored Brands Advertising, and other forms of exposure.
Amazon frequently reminds you of their strict restrictions that prevent you from promoting our storefront on Amazon’s website. However, you can still gain a social media presence.
The other simplified part that Amazon handles for you is Amazon FBA. FBA, as we said earlier, is Fulfillment By Amazon. FBA Sellers get all sorts of perks:
- Fast two-day shipping to expand your customer base.
- The ability to hand off all logistics to Amazon.
- Having a warehouse without paying for it.
- The backing of Amazon’s second-to-none shipping services.
The only company that can come close to Amazon when it comes to logistics is Walmart. However, Walmart doesn’t allow everyone to sell on their platform.
Amazon empowers sellers to start stores with little more than a dream.
Not everything is golden when it comes to being an Amazon salesperson. The biggest issue goes back to traffic.
While Amazon essentially pays for the marketing for you, it reminds you of that at every turn. Amazon owns your traffic, and you cannot use that traffic to promote your business.
Amazon will remove your page if you use its customer messaging system to tell people about your website. Amazon prohibits any promotion of off-site storefronts.
It’s also incredibly easy to be removed due to a miscommunication. If a friend of yours happens to buy one of your products, you can get removed from the platform for manipulated stats. Suspensions are commonplace for new sellers.
Amazon strongly prefers FBA selling, and those who already own warehouses are typically given the short end of the stick. Amazon also has no mercy if you have personal problems that tank your metrics.
For example, stockouts (or running out of inventory) can ruin your chances to compete. Even if the stockout issue is related to your supplier, many early sellers pull out entirely and choose a new product listing if they run out of inventory.
FBA sellers must pay pretty intense selling fees for joining the platform. Commonly, the two highest costs for sellers at Amazon are advertising and FBA fees.
Fees (and Other Costs) or Selling on Amazon and Shopify
Amazon and Shopify both have different pricing options. Shopify is far more expensive than Amazon in this regard because you also need to include the costs of managing a website.
You can break down Shopify plans into three pricing options:
- Basic Shopify
- Shopify(middle cost)
- Advanced Shopify
All plans come with the following:
- An online store
- Unlimited products
- Up to two staff accounts
- Up to four inventory locations
- Manual order creation
- Discount codes
- A free SSL certificate
- Abandoned cart recovery
- Gift cards
- Shipping labels and discounts
- Access to multiple POSs (Point of Sales)
- International Options
The standard Shopify and Advanced Shopify plans include additional inventory locations (8 on the max option), seller reports, more staff slots (up to 15), reduced transaction fees, and more significant shipping discounts.
You can also pay for Shopify Lite plans if you sell in person. Shopify plus plans are for enterprise sellers who have massive stocks and multiple staff members.
Because Amazon does not enable you to create your own website, you have two payment plans:
- Professional selling
- Individual selling
The professional selling plan is for those who sell more than 40 items per month. It also includes extra tools for metrics tracking, advertising, and a higher potential to rank high on product listings.
You want to be a professional seller if you want any chance to rank decently for any product category. It costs $39.99 per month.
Individual selling plans are better for people who want to test the waters. They do not have access to professional reports or advertising. Personal selling accounts cost $9.99 per month.
You also need to address FBA fees, but costs come from selling. To determine how much you need to sell to make a profit based on your price, check out Amazon’s FBA estimator.
Benefits for Sellers on Amazon Marketplace
As a beginner seller, you really cannot beat Amazon Marketplace. Where Shopify has website-building tools, Amazon has sales creation tools.
With third-party tools, you can track competitor prices, estimated monthly sales of a product, and validate if your product will sell well based on existing research tools.
Shopify is excellent if you already know how to establish a store. But even sales veterans go to Amazon to increase sales potential.
Conclusion – Which Market is Right for Your Business?
If business owners are trying to decide between these two eCommerce platforms, it depends on how much experience they have.
If you are already a pro at digital marketing, Shopify can be great to supplement the website-building aspect of that business. Be prepared to pay a higher upfront cost as a result of choosing Shopify.
If you have less than $1000 bucks to start and don’t know how to market yourself, Amazon is your best bet. However, you might consider eventually investing in a Shopify site to grow your off-site brand.
You should base your choice on your skillset.