Yesterday we saw Shopify's Reunite event get broadcast. Broadcast, because the in-person event was cancelled this year due to COVID-19. The remote format of the event didn't seem to stop the flow of announcements, and it certainly seems as if the current global lockdown has spurred Shopify into a series of announcements aimed at helping the smaller merchants out there.
So we thought we would cut down the announcements into bite-sized chunks so that you can get up to speed on what's new and coming. As usual with Shopify events, there is a lot!
Now that Shopify are heavily invested in financial services around their merchant ecosystem, it was only a matter of time before this extended further into their merchant's day-to-day operations. Shopify Balance provides a virtual bank account, payment cards to access the money in their accounts (including ATM usage), and rewards (in the form of cashbacks) for using the account.
This is an interesting move from Shopify, as it seeks to keep hold of merchant revenue for as long as possible, and across multiple touchpoints. Given the micro-incremental revenue gained by going so, it will surely enable it to solidify its market position with the additional cash reserves that it generates for the business.
For merchants, Shopify are banking on the convenience factor of having everything under one roof. Early access in the US kicks off later in 2020, and their is a waiting list for that access. More details here.
This provides finance to merchants who have trading activity with Shopify, and serves to finance amounts from $200 to $1m. The model is similar to how PayPal Working Capital operates. It seems as if Shopify have accelerated their roll-out of this scheme in relation to the COVID-19 situation, and have now launched in the UK and Canada, in additional to the original US launch. More details here.
Shop Pay Installments
Customers of Shopify sites will soon be able to split the payment of a checkout into installments. As many merchants have found with similar services like Klarna, this has a natural boost on sales, as it makes purchases more immediately affordable. Just like Klarna, Shop Pay Installments will pay out to the merchant in full at the point of order, so for them there is no real risk in offering the service.
The service is being rolled out in the US first during 2020. More details here. Further rollout is likely to be governed by the speed at which Shopify can get themselves ratified with credit provider licenses in various other key markets.
Again, it seems that Shopify have brought forward some initiatives that they think will help the rush for small merchants to get online, which is being driven by the current lockdown. Their new free theme called Express is designed to offer a simplified front-end for merchants with a few products. The customer experience is simplified into a single page, and so suits merchants selling complementary products - which is especially good for the food and beverage sector which has been hit so hard by COVID-19. More details here.
OK, so we know that gift cards in Shopify is already a thing. However, the feature is now being rolled into the platform free of charge - temporarily it seems. The change of policy is to help boost merchants' opportunities to sell more via their sites. More details here.
This is an interesting one. Once this new feature is enabled, customers can choose to add an additional amount to their checkout total by way of a "tip". The idea is to enable small merchants to receive the same financial appreciation that they might receive in their physical outlets, which might be closed at the moment. More details here. Please note, for Shopify Plus merchants using customised checkouts, the tipping functionality is not available.
Managing multi-region sales operations in Shopify has always been tough, compared to Magento, for instance. There does now seem to be some forward motion from the Shopify side though. Firstly, there will be the ability to configure multiple local domain variations per Shopify site. This means that you can have yoursite.com, yoursite.co.uk and yoursite.fr (for example) linked to the same Shopify account. Each of these can have different currencies, languages, etc. This is a big deal for Shopify, and I hope it is not too constrained for the merchant. The SEO side of this is aided by automatic hreflang tags added to the site's HTML so that Google is properly informed about which domains serve which countries and languages.
For site currency, something called "Custom FX" is coming. This enables currency based pricing to be fixed, rather than be subject to a conversion from a base currency which results in change pricing values at the front-end, and strangely specific pricing (e.g. $123.45). Again, this is a big deal for Shopify, because it will certainly help them win business again platforms like Magento in future.
Last year's Shopify Unite saw the beta launch of their new online store design experience which aims to provide more flexibility for merchants to modify the front-end of their site without developer involvement. That is still in beta today and will roll out later in 2020. At Reunite, this was essentially teased again. It seems as if further work has been done to allow developers to build page sections in a way that will be more compatible with themes, and less likely to break layouts and functionality when used by merchants.
Changes like this that put increased flexibility in the hands of merchants is a positive step. My own view is that feedback within the beta program has shown that this flexibility can lead to problems with front-end issues, and that much more work was/is required to make the tool "just work".
Product subscriptions also received a nod this year, and whilst not much more was seen compared to last year's Unite, we do know that subscriptions form an important part of the checkout roadmap. Given the distinctly different customer and checkout journey that subscriptions can trigger, it seems (like with Sections everywhere) that challenges in making a seamless front-end experience are causing a cautious approach to the rollout.
The redesigned POS application formed a major part of Reunite. Shopify have evolved the functionality and usability of this to help struggling retailers implement social distancing retail models within their physical outlets. For example, QR code scan-and-pay. Part of the help for retailers also comes in the form of free access to the "Pro" featureset from now through to the end of October 2020. More details here.
Available since April, Shopify Email provides a simple means for merchants to create marketing emails for their customers and send them. Shopify currently have a 90-day free trial.
All the main players have partnered with Facebook to help launch Facebook Shops (although Magento have been strangely absent and silent on this). This initiative enables Shopify merchants to quickly and easily deliver a shopping experience within Facebook and Instagram, and still use the Shopify backoffice functionality to manage orders, stock, products, etc.
Given the reach that both Facebook and Shopify have amongst smaller merchants, this is very important development and its potential to drive growth in some B2C sectors will be massive.
Of course, the concern for some ecommerce platforms is that Facebook eventually cuts ecommerce platforms out of the loop entirely. This concern has been seen and realised with Amazon sellers also. The sheer size of Facebook and Amazon is both the opportunity and the danger.
Ping is a messaging solution between merchants and customers, allowing real-time communication to aid the customer journey. With the variety of product launches at Reunite this year, a common vein seems to be that they want to launch tools into the commerce stack of many merchants at the lower end of the market, rather than make big changes to the commerce platform itself (although there are some).
The "commerce stack" is the toolset that a merchant uses to run their operate. It consists of an ecommerce platform, email marketing tools, analytics, advertising, customer success, loyalty, etc, etc. As we know, an entire ecosystem exists around practically every ecommerce platform that delivers all of these tools in the commerce stack. Shopify seem keen to continue to nurture smaller merchants and help them grow, putting an increasing range of Shopify-branded tools in front of them in order to keep that spend within Shopify rather than lose it to other vendors.
Shopify Ping is a great example of this. It's also free, which means adoption will be high. There are a ton of similar tools on the market. Some are free but not great, others operate freemium to premium functionality. However, the seamless integration that Ping offers with Shopify seems very compelling. It also integrates with Apple Business Chat, Facebook Messenger and Shopify Chat. Currently iOS only, but coming this summer to Android and a web-based version later in the year. More details here.
Shopify have buffed their Shop app. Merchants can also now get more involved with it, with content options to expose brand information to customers. However, one of the most controversial features in my opinion is that buyers will see product recommendations within the app. It seems like these are from merchants you might have already purchased from in the past. From a brand's perspective this means that a customer who buys products from me might/will see my competitors products as recommendations within the app, where they can also be directly purchased without leaving the app.
Of course, this works both ways. However, brands will rightly consider their customer aquisition costs to be negatively affected if "their" customer immediately sees other brands' products. This dilution of brand messaging won't site well with some merchants. We may also see some clever targeting of products between brands to capitalise on fast moving trending products. How many brands would allow competitors to advertise their products on their order confirmation pages? None. But this seems to be one of the outcomes caused by the direction that Shopify's Shop app is heading in. More details here.
Commerce platform improvements
With so many non-platform announcements so far, it is probably a good idea that we finish with a round-up of the platform improvements announced. None are particularly massive, but they do show that the merchant feedback loop is driving the roadmap.
Products can soon be created in draft state, so that they can be reviewed internally. Likewise, there the ability to archive products.
Product creation enhancement
Merchants will be able to create, review and publish products from their phone. This is great for smaller merchants. However, for those larger merchants looking after larger catalogues, then the UI within the backoffice for product creation is also being optimised.
This seems to allow merchants to manage, to some degree, inbound inventory from suppliers. This is obviously a headache for merchants of all sizes on all platforms. I'm sure that there is a cross-section of merchants on Shopify that would use this, but my own thoughts is that this is well thought out feature that won't be massively adopted by the Shopify merchant base. The featureset includes a workflow for POs, PDF export, product cost tracking, shipping notes, and mobile integration.
Order list page
The main Orders→Orders page in the backoffice is getting buffed to include more information about each order in the grid itself. For merchants without any form of ERP/WMS integration but with a decent order volume, the backoffice was always a pain - you had to click in and out of each order individually just to see basic information. Now some of this is in the grid itself, so will be a time-saver.
Local and curbside pickup
COVID-19 has certainly caused many merchants to be caught off guard in relation to their ability to pivot into new forms of shipping option in the checkout. In this case, not actually shipping, but pickup and local delivery. Merchants need to be able to consider delivery radius, manage pickups, and more. These options are now available. I think we all now realise that such options are here to stay now, and having them baked into the platform just makes perfect sense now.
Shopify have re-factored their platform code that renders web pages to be, in their view, 40%-200% faster. Whether these figures stack up as true across a broad range of themes remains to be seen. Shopify are also adding performance instrumentation to their rendering engine. This will provide insights into page loading metrics like Time to First Byte (TTFB) and First Contentful Paint (FCP) within the Shopify backoffice. Very useful.
Shopify Fulfillment Network
Announced last year, the Shopify Fulfillment Network seems to be on a slow burn at the moment - building capacity, increasing footprint, testing and making preparations. Shopify announced that there are now seven SFN warehouses in the US, with one in Canada coming on line later this year. The likelihood is that Shopify already have leases on commercial property in other key markets, including the UK and mainland Europe, and that further announcements later this year will show how they plan to implement this grand plan.
The play here against Amazon is vital for Shopfy. It is a huge investment, and maybe they will have things in place soon enough for it to become a strong competitor and a magnet for merchants to launch on Shopify.
We also learned at Reunite, that their acquisition of 6 River Systems has led to the successful introduction of a robot workforce within SFN.
Wow! What a strange event
With online conferences the new norm, Reunite was strange. I am sure for many in the Shopify ecosystem, that the biggest thing missing from Reunite was the interaction with other partners, customers, suppliers that Unite usually fosters. I guess we'll get back to that, at some level of the next year or so. However, the announcements came thick and fast, and whilst some were really only re-announcements, the key take-away was that Shopify is heavily investing in their platform, and not afraid to bring innovations to the market to react to the current market conditions faced by their merchant customers.