Shopify Cuts Costs For Partners, Which Could Lead To Merchant Growth

The Shopify Unite event was held this week highlighting new launches from the company and how it can help its partners in the growing e-commerce market.

Shopify Unite: Shopify Inc SHOP saw more than 450 million people complete checkouts in 2020. The company processed around $120 billion in gross merchandise volume in 2020.

One of the keys of Shopify Unite was to “give entrepreneurs limitless creative power.”

“Today at Shopify United 2021, we announced our largest set of platform investments to date,” the company said.

Shopify announced new launches and updates that will help merchants, developers and entrepreneurs.

“The internet is the world’s largest city and Shopify is building its commerce infrastructure,” Shopify CEO Tobi Lutke said. “The future of commerce on the internet relies on creative expression at every touchpoint.”

Related Link: How To Buy Shopify Stock 

Storefronts: Shopify announced the biggest upgrade to Shopify Liquid ever. Storefronts allows merchants to better showcase their brands without touching code with a new update.

Shopify is also launching new developer pages for every page to allow personalization for all aspects of the store.

Faster response times are coming to stores with major global infrastructure investments from the company to help with over 100 server locations.

Shopify’s Theme Store will open for submissions on July 15 for developers. Custom storefronts under the Hydrogen brand will launch soon and is a major growth initiative for the company.

Checkout Process: Checkouts for customers will be faster with Shopify investing in technology.

The company’s goal is to offer customers the ability to sell 300,000 pairs of sneakers in eight minutes and each shop to be able to handle peak Black Friday and Cyber Monday shopping volume every day.

Shopify is launching Checkout Extensions, which will allow developers the ability to build apps into the Shopify Checkout platform.

Payments Platform will integrate third party payments into the Shopify Checkout process, which could add growth for merchants.

Cutting Costs: One of the biggest news items from Shopify Unite was the decision to cut the revenue share for developers.

Developers who build for the Shopify App Store will now pay 0% revenue for the first $1 million they earn annually on the platform. The new initiative will launch Aug. 1 and the $1 million level will reset annually.

The same 0% revenue share model is also being offered to Theme Store developers as of July 15. Over 1.7 million merchants use Shopify themes globally.

The new developer-first business model will mean Shopify takes 0% revenue until $1 million in annual revenue for both the Shopify App Store and Shopify Theme Store.

Along with going to the 0% on the first $1 million, Shopify is also cutting its revenue share model. The company currently charges a 20% revenue share. That will be lowered to 15% on revenue over the $1 million mark.

Global Payments: Shopify is making it easier for merchants to scale globally. The company will offer international pricing that allows merchants to offer per-country pricing.

Shopify Payments Platform enables payment gateways for Shopify apps and allows its merchants the ability to sell more in additional territories.

Benzinga’s Take: Shopify made several updates to its platform to help its massive merchant customer base. The decision to cut the revenue take and not take revenue until $1 million is a bold move that could help win new developers and merchants to the platform and likely fight off competition.

Shopify shares are trading flat at $1,484.85 on Wednesday. Shares are up 31% year-to-date and have returned over 4,000% in the last five years.