COMPANY PROFILE -Shopify
Business Sector :Software and Programming
Operating Geography :Canada, North America, Global
About Shopify :
Founded in 2004, Shopify Inc is one of the leading global commerce companies operating across various geographies on both online and offline platforms. Headquartered in Ottawa, Ontario, Canada, the company is involved in providing tools and software to merchants for running their business across multiple sales channels like online storefronts, physical retail stores and marketplaces. The business model of Shopify includes two revenues streams, namely merchant solutions and subscription solutions and the business ecosystem of the company developed due to the platform’s functionalities includes app developers, theme designers, digital and service professionals, marketers, and affiliates. Recently, as of February 2020, Shopify was acknowledged as one of the top e-commerce platforms by SoftwareReviews’ 2020 eCommerce Data Quadrant Awards, with a composite score of 8.2.
Shopify’s unique selling proposition or USP lies in providing differentiated services to its merchants by offering them a diverse set of customized, mobile compatible, multi-channel front end and single integrated back end services with the help of its state-of-the-art and cloud-based infrastructure. The company strives to achieve its strategic objectives with its mission statement: “to make commerce better for everyone, and we believe we can help merchants of nearly all sizes, from aspirational entrepreneurs to large enterprises, and all retail verticals realize their potential at all stages of their business life cycle.”
Shopify Revenue :
USD1.578 billion – FY ended 31st Dec, 2019
USD1.073 billion – FY ended 31st Dec, 2018
Competitive Analysis of Shopify
The SWOT analysis for Shopify Inc is presented below in a table followed by the detailed analysis report.
| Strengths | Weaknesses |
1. Wide portfolio of innovative products including storefront tools available on the online platform
2. Strategy-aligned business acquisitions adding to the profits
3. Exponential year on year growth trajectory
4. Providing merchants with differentiated technology offerings
5. Strong and symbiotic partner ecosystem
6. Provision of rich customer experience to the merchants and sellers
| 1. History of losses and accumulated deficit |
| Opportunities | Threats |
1. Investments in marketing or promotional activities to increase brand awareness
2. Collaboration with Libra Association and Coinpayments to enable cryptocurrency payments
3. Expansion into logistics and fulfilment services
4. Strong and consistent growth expected in e-commerce
5. Entering into the Asian markets through collaborations
| 1. Economic headwinds may hamper revenue growth
2. Aggressive competition to Shopify’s fulfilment network from Amazon, United Parcel service
|
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Detailed SWOT Analysis of Shopify
Strength
1. Wide portfolio of innovative products including storefront tools available on the online platform: Shopify’s top-level leaders have talked about the future of commerce, as well as the company’s product roadmaps for its partner and developer communities. The company believes in making intensive investments in creating better product browsing experiences that will lead to higher customer engagement and faster conversion rates. Shopify has opened up access for all its merchants, to the Video and 3D updates added to Shopify Admin’s product section as well as to the Shopify Admin API and Storefront API. The company offers the GraphQL Admin API to its developers, through which the latter can associate videos and 3D model assets with a product. Moreover, from the Shopify Unite Mainstage, the company announced further additions to the Storefront API, for enabling retrieval of product media types using offsite storefronts and mobile apps.
2. Strategy-aligned business acquisitions adding to profits: Shopify has aggressively diversified to increase its profitability and has made several business acquisitions aligned with its strategy. Shopify marked the end of 2018 with the acquisition of Tictail, Inc and its subsidiaries, strengthening its e-commerce operations. The company continued on the same path into the year of 2019. It acquired several other companies such as Helpful.com, Inc, Handshake Corp, Vinderbit Pty Ltd and 6 River Systems, Inc. Through the Handshake and Helpful.com acquisitions, Shopify expanded its offerings into business-to-business ecommerce solutions and AI-based enterprise mobile products. Using various discounted cash flow methodologies and cost approaches, the company weighs the entity to be acquired and measures its contributions to the business and the overall value it will bring to the table.
The remaining section of “Strength” is available only in the 'Complete Report' on purchase.
Weakness
This section is available only in the 'Complete Report' on purchase.
Opportunity
This section is available only in the 'Complete Report' on purchase.
Threats
This section is available only in the 'Complete Report' on purchase.
The PESTLE / PESTEL analysis for Shopify Inc is presented below in a table followed by the detailed analysis report.
| Political | Economical |
1. Political tensions with China may make business difficult
2. Political inclinations leading to criticism and controversy
| 1. Fluctuations in macroeconomic factors like exchange rates |
| Social | Technological |
1. Increase in the number of active internet users to drive e-commerce shift
2. Culture of deep value innovation and experimentation
3. Social measures during pandemic driving e-commerce growth
| 1. Adoption of advanced and innovative technologies
2. Brands going omnichannel to forge a deeper connection with the customer
|
| Legal | Environmental |
| 1. Dependent on wide range of regulations across the operating geographies | 1. Investments towards sustainability for a low-carbon future
2. Shifting to carbon neutral platforms and renewable sourcing
|
On purchase the Shopify SWOT and PESTLE Analysis PDF report will reach you within minutes. At rare times, a slight delay not exceeding 1 hour might be caused.
Detailed Pestle Analysis of Shopify
Political
This section is available only in the 'Complete Report' on purchase.
Economic
This section is available only in the 'Complete Report' on purchase.
Social
This section is available only in the 'Complete Report' on purchase.
Technological
This section is available only in the 'Complete Report' on purchase.
Legal
This section is available only in the 'Complete Report' on purchase.
Environmental
1. Investments towards sustainability for a low-carbon future: With the ever-evolving landscape, challenges like climate change and carbon emissions have become more severe in nature. This has prompted responsible corporations to roll out initiatives for reduction of their environmental footprints. Moving along the same direction, Shopify has made commitments for achieving the long-term goal of having a low-carbon future. To fight its environment, the company has planned to spend an annual amount of at least $5 million USD every year as a part of the Shopify Sustainability Fund. This will include all of Shopify’s investments towards environmental safety, commitments for using promising, impactful technologies and launching projects working towards fighting climate change at a global level.
2. Shifting to carbon neutral platforms and renewable sourcing: For decades, anthropogenic climate change effects have been fuelled by innovation and progress powered by fossil fuels. To overcome these challenges, companies across the globe are coming up with new solutions and are putting forward their best efforts to scale them up. Shopify has shifted its focus towards being a carbon neutral platform by reduction of greenhouse gas emissions from data centres, which have historically contributed a lot to climate change. The company shifted to Google Cloud for powering its platform in 2018, and thereby becoming carbon neutral through this initiative as the energy consumed by Google Cloud comes from renewable sources. Also, in 2019, Shopify began renewable sourcing of energy for heating and powering its buildings and procured green energy, equal in magnitude as that of its Canadian carbon footprint. Moreover, the company purchased verified carbon offsets for its travel-related emissions, which account for nearly five times of its operational footprint.
Major Competitors :
- BigCommerce
- WooCommerce
- PrestaShop
- Wix
- 3dcart
- Big Cartel
- Weebly
- Magneto
- Volusion
- Squarespace
Major Brands :
- 6 River Systems
- Boltmade
- Handshake
- Oberlo UAB
- Shopify Payments
- Shopify Holdings
- Shopify LLC
- Shopify Commerce Singapore Pte. Ltd,
- Shopify International Ltd
- Shopify Capital
- Tictail
- Tiny Hearts
On purchase the Shopify SWOT and PESTLE Analysis PDF report will reach you within minutes. At rare times, a slight delay not exceeding 1 hour might be caused.
TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?
You may also be interested in other analyses of Shopify:
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| Shopify Porter's Five Forces Analysis |
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| Shopify Value Chain Analysis |
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| Shopify Covid-19 Impact Analysis |
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| Shopify Segmentation, Targeting and Positioning (STP) Analysis |
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| Shopify Ansoff Matrix Analysis |
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References used in Shopify SWOT & PESTLE Analysis Report
1. Shopify Annual report 2019 - https://s23.q4cdn.com/550512644/files/doc_financials/2019/ar/0efb0f8e-be6a-47d9-b0d6-11a92482dbd3.pdf
2. Shopify’s announcements of 2019 - https://www.shopify.in/partners/blog/shopify-unite-announcements-2019
3. Global Ecommerce Statistics and Trends to Launch Your Business Beyond Borders - https://www.shopify.com/enterprise/global-ecommerce-statistics
4. Shopify technology platform - https://www.shopify.in/partners/blog/shopify-technology-platform
5. Shopify sustainability initiatives - https://www.shopify.in/about/environment
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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Shopify Inc SWOT and PESTLE analysis has been conducted by Anindya Anindita and reviewed by senior analysts from Barakaat Consulting.
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