- Shopify should beat its “conservative” revenue guidance of 19% growth in 2024 on the back of continued, strong customer spend, according to the expert. While Shopify will make some effort to improve short-term profitability, the CEO will remain focused on growth and product quality, as the underlying business model remains profitable and only SFN requires significant capital investment to drive growth, they added.
“At this point in Shopify’s business, most of its short-term growth is much more driven by how consumers are spending on existing Shopify stores rather than how many new stores are coming in in any given period.” Former VP at Shopify Inc
- Although the SMB segment lacks growth potential given saturation levels, Shopify’s growing share in the mid-market segment, which has higher GMV and more growth potential, more than makes up for it.
- Shopify’s point-of-sale (POS) system has been a focal point as it builds out an offering more suitable for mid-market and enterprise clients. As retailers grow, their mix of bricks-and-mortar revenue is higher than small retailers, “so capturing the mid-market with the POS [point-of-sale] is the real prize for Shopify”, we were told.
- Q4 2022 performance shows that Shopify is outgrowing both Amazon and overall e-commerce spending, which has now normalised and will see continued, strong growth moving forward. Indeed, Shopify still has many structural advantages, we heard. “Few retailers ever leave Shopify to go to someone else, and most new merchants will build on Shopify,” the expert said.
- Buy with Prime is a threat, but Shopify is likely to form a favourable partnership that allows it to take advantage of delivery and fulfilment while protecting its Shop Pay revenue, our Interview suggests. “There have been reports that those conversations are ongoing. We saw BigCommerce make one of the first significant deals with Buy with Prime,” the specialist said.
- We were also told there is “significant white space” for Shopify to cross-sell Plus to existing merchants.
Click here to access all the human insights in Third Bridge Forum’s Shopify – 2023 GMV Expectations, SFN Update & E-commerce Growth Interview.
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The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
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