Why Read this Article:
This article provides an overview of the most popular e-commerce platforms available to online merchants and gives the reader advice on how to choose the right one for them.
With several e-commerce platforms to select from, choosing one can feel like standing in front of the cereal display at the grocery store — all the different options can be paralyzing. But the fact is, when armed with the right information, you can make the right choice and feel confident that you’ve got the best e-commerce platform for your needs.
It’s important to know that certain platforms are ideal for certain types of businesses but not for others. The ideal platform for your business will depend on:
- Where you are in your business lifecycle (just getting started, or established brand);
- Your industry (fashion, furniture, jewelry, etc.);
- Your specific needs (customer segmentation, inventory management, etc.)
Of course, another consideration is the cost of each platform. The more functionality that a platform has, the more expensive the service will typically be. It’s important, however, to not simply focus on the expense, but to evaluate the value you are getting from the platform versus the cost.
In this article, we will take a look at which platforms are best suited for merchants in the various stages of their lifecycle.
1. You’re Just Starting Off As a Retailer
Shopify (and Shopify Plus):
Summary: Shopify is a quickly growing e-commerce platform, founded in 2006, that makes it easy to set up an online store. It’s a good fit for small businesses, mid-market companies, and enterprise companies. It has an enterprise version called Shopify Plus that comes with a dedicated account manager and a different pricing structure. Currently, Shopify has over 175,000 businesses using its platform, including Tesla, Budweiser, and Strava.
What it’s good for: Shopify is a perfect option for businesses looking for a simple and streamlined online store. Shopify is known for being easy to use and having aesthetically appealing store designs. Over 100 Shopify themes are available, including some that are free and others that cost up to $180. Shopify also has a robust app ecosystem, which enables its clients to perform a wide range of actions (like sending abandoned cart emails). Recently, Shopify has partnered with Facebook and with Twitter and announced it will soon allow its merchants to sell directly on those social networks with a one-click experience. One other selling point that Shopify highlights is their community of experts – from developers to photographers to marketers – who are accustomed to working with Shopify and are available for hire right on the Shopify website. There is also a highly trafficked Shopify forum, with topics ranging from drop shipping to e-commerce payments, where merchants can ask and answer questions. Shopify also offers 24/7 customer support. Shopify Plus offers a few nice features in addition to the ones mentioned above, including unlimited bandwidth and same-domain checkout pages (i.e. your own domain, not checkout.shopify.com). The bottom line is that Shopify is a very good choice for businesses that are just getting started (and those that are more established) who are looking for a simple and elegant e-commerce platform to help them grow.
Price: Shopify costs between $9 and $179 per month, plus 0.5-2.0% of each transaction. On the other hand, Shopify Plus has no transaction fees, but the monthly cost is higher, starting at $995 per month.*
Summary: Bigcommerce was founded in 2009 and launched the enterprise version of their platform in May of 2015. Over 100,000 merchants currently use Bigcommerce including Schwinn, Gibson, and Toyota.
What it’s good for: Bigcommerce is an easy-to-use e-commerce platform that offers integrations with many e-commerce service providers. It also has a range of other features, such as abandoned shopping cart reports that show where and when customers are abandoning their carts. This can help merchants figure out how to convert those potential customers and perhaps do a better job optimizing those pages. Bigcommerce is a cloud-based platform, which for many merchants means less hassle and less need for internal development resources. One nice feature of note is a number of themes that are specially designed for mobile responsiveness. There is an ecosystem of apps that provide a wide range of additional features that might come in handy for merchants, and Bigcommerce recently announced a partnership with Twitter that will allow its merchants to offer one-click buying via Twitter.
Price: The most basic plan, called “Standard,” costs $29.95 per month, which includes unlimited storage and an unlimited number of products, but also includes a 1.5% fee on transactions. If you want to avoid the transaction fees, you can choose the “Plus” plan, which costs $79.95 per month. Meanwhile, the enterprise version of Bigcommerce starts at around $1,000 per month and that price can increase depending on the size of your business and other factors. It has no transaction fees.*
Summary: Magento, one of the most well-known names in the industry, offers an open-source version of their software for those companies not big enough or profitable enough to pay for their enterprise version called Magento Community.
What it’s good for: The Community version has a lot to like. For one thing, there is a large pool of users who contribute to the code and who create extensions that increase the functionality of the platform. However, Magento is not easy to customize unless you know how to code. That means customizing your site will require the help of a developer, which can mean significant costs. And there is no dedicated customer support available by phone or email. As a free, open-source platform, Magento Community puts everything in your hands, which is great as long as you are prepared to handle it. For small and medium-sized businesses that have internal development help, Magento Community can be the perfect solution to create a highly functional e-commerce website.
Price: Magento Community is free to use but still requires hosting, which can add up to several hundred dollars per month. There are also templates and extensions that will improve your website but can cost hundreds of dollars each.*
Summary: WooCommerce is an e-commerce platform built on top of WordPress, the largest publishing platform in the world. WooCommerce is currently used by hundreds of thousands of web stores all over the world.
What it’s good for: WooCommerce is perhaps most different from other platforms because of the fact that it is built on WordPress. This has advantages and disadvantages. For example, there is a very large community of users who can help answer questions that arise. The active community also creates a diverse array of plugins, which give flexibility to businesses using the platform. Plugins allow you to do things like offer customers dynamic pricing (such as special offers for Gold Members, or a discount for purchasing 5+ items). WooCommerce is pretty easy to use, although if you want to make use of its wide range of features, you will need to hire developers internally or contract with external developers to make it work properly. The bottom line is that there is almost nothing that cannot be done with WooCommerce via its wide range of plugins and native features. For that reason, it’s a great choice for businesses who want to build on top of WordPress.
Price: WooCommerce is free, however merchants still incur costs for hosting, for themes and plugins, and for in-house developers.*
2. Your Business is Growing and Needs a Platform with More Flexibility
Summary: If you’re looking for arguably the ‘most popular platform,’ you can find it here. Magento Enterprise is one of the most widely used e-commerce platforms in the world. Many well-known brands use Magento Enterprise, including Nike, Vizio, and Olympus. While it has an open-source version that is available to anyone (see above), its business rests on its enterprise version.
What it’s good for: The reason Magento Enterprise is so popular is that in addition to being well-designed and flexible, it enables companies to segment their customers in ways that are very useful. For example, if you want to invite customers who made a purchase from your website in the last 30 days to a special online 24-hour sale, you can do that with Magento Enterprise. Or if you want to send an email containing a specific product advertisement to every customer who purchased a similar item in the past, you can do that. You can even target customers by location. This is obviously very useful to enterprise businesses that have thousands of gigabytes of data about their customers. Having the capability to show a customer the right message at the right time is a huge advantage for a large business. You can also create an unlimited number of content blocks and landing pages with Magento Enterprise.
Price: If you’re a very large business, you can expect to pay anywhere from $15,000 and $80,000 per year to run Magento Enterprise. That doesn’t include hosting costs, which are paid by your company separately. The good news is that the price comes with really solid 24/7 customer support.*
Summary: Volusion is a popular and widely used e-commerce platform that boasts quite a few name-brand clients, including Intel and 3M. The company was founded 15 years ago and currently has 40,000 e-commerce stores using its products.
What it’s good for: Volusion is a great fit for companies who are looking for an all-in-one e-commerce solution. It has a range of features that make marketing and SEO easier, including built-in customer reviews, auto-generated sitemaps, and integration for shopping engines like Google Shopping. Volusion can require a bit more development work than some other solutions, so for that reason it is a better choice for those companies who have plenty of internal development help. Volusion has over a hundred templates, some of which are free and some of which come at an additional cost to the merchant.
Price: Volusion pricing is on a subscription model, with monthly prices starting at $15 and going up to $135. With each of the plans, you get unlimited storage and no transaction fees, but with the most expensive plan you also get an unlimited number of product listings, as well as a dedicated account manager and priority customer support.*
3. You’re a Long-Time Established Brand
Summary: Demandware, launched in 2004, is a beautiful and highly functional e-commerce platform that comes with an equally high price. It is used by companies such as Adidas, Saks Fifth Avenue, Callaway, and GoPro.
What it’s good for: Demandware bills their platform as a simple, no-hassle cloud-based version of traditional e-commerce software that eliminates headaches and reduces costs associated with maintaining and fixing traditional e-commerce software. It also emphasizes how quickly companies can make changes within the platform and the fact that Demandware updates happen seamlessly. These are some of the benefits of a cloud-based e-commerce platform. And although it is not self-hosted, Demandware is still able to offer its clients a fully customized experience in terms of site design and functionality. These factors make Demandware a great choice for large, profitable companies that are looking for a well-designed cloud-based e-commerce solution.
Price: Demandware uses a subscription based model where merchants pay a licensing fee equal to 0.75-1.25% of the sales they generate. For a merchant that generates sales of $20M per year, the licensing fee would be $200,000 per year or more.*
SuiteCommerce (by Netsuite):
Summary: NetSuite was founded in 1998 as a web-hosted accounting software. It has since grown into a full range of products for businesses, including SuiteCommerce, which is an e-commerce platform that incorporates online and point-of-sale transactions, as well as customer relationship management. It is currently used by retailers such as Saddleback Leather, Igloo, and Thos. Baker.
What it’s good for: One of the advantages of SuiteCommerce is that it can encompass many areas of an enterprise business and allow executives to see real-time inventory across all channels. By unifying data from online sales, in-store sales, and customer interactions across all devices, SuiteCommerce provides a unique “single view” of each customer that can be extremely useful for businesses. This makes it easy to, for example, send personalized marketing messages to customers based upon their buying history, geographic location, and other factors. The unified view offered by SuiteCommerce also improves order fulfillment for many companies, and can help executives understand which products are selling and which are not. For these reasons, SuiteCommerce is a good choice for enterprise companies that sell online and in physical stores and that are ready to move all their data, including CRM data, into the platform.
Price: Unlike Demandware and many other platforms, SuiteCommerce does not charge based on revenue or the number of transactions processed. Instead, it charges based on the number of modules used inside the platform, which increases with the number of products for sale. And it also charges companies based on the number of internal staff who have access to the platform. The up-front cost starts at $3,999 per month but increases depending on the size of the company.*
Summary: Hybris was founded in 1997 and has evolved into one of the most widely used e-commerce platforms today. Currently, more than 2,500 companies use Hybris for their e-commerce businesses, including Asics, Brita, Land’s End, and Honeywell.
What it’s good for: What separates Hybris from other e-commerce platforms is its flexibility. It can be managed and hosted in-house, or it can be hosted and maintained externally the way a cloud-based solution like Demandware would be. Importantly, the configuration can change over time as the company grows and its needs evolve. This kind of flexibility can be hard to find and it’s one of the main reasons companies choose Hybris. With Hybris, you also have the ability to choose which products are viewable in each channel so you can customize product listings and messaging based on customer segments. Hybris is a good choice for large companies that need lots of flexibility and that plan to grow a lot in the future — especially ones with a physical store presence.
Price: Hybris offers several payment options, including long-term licensing and a revenue share model. A standard license starts at around $54,000 and increases depending on the size of the company and what services and product modules it will need.*
Summary: IBM Websphere is a comprehensive platform that provides consistent experiences for shoppers across all devices and helps merchants deliver customized offers and marketing messages to their customers. This platform is used by companies such as Staples, Goodyear, and LL Bean.
What it’s good for: IBM Websphere is a heavy duty solution that can be a great fit for large businesses that need an all-in-one solution and have plenty of resources to launch it and maintain it. The platform can deal with both B2B and B2C business models (simultaneously if necessary), and supports omni-channel selling by dynamically optimizing content for each type of device — laptop, desktop, mobile phone, or tablet. However, this is not a good platform for businesses with limited development resources or those that don’t have the internal expertise to manage a platform like this one.
Price: The pricing structure can be a bit complicated. For the enterprise-level package, it’s approximately $15,000 plus an additional yearly fee per unit. In other words, the more products your business is selling, the more you’ll pay (up to $1,990 per product per year).*
Mozu (by Volusion):
Summary: Mozu is the enterprise version of Volusion (see above), which is a popular and widely used e-commerce platform.
What it’s good for: Mozu is a cloud-based platform that emphasizes marketing capabilities and omni-channel selling. With Mozu, merchants can provide consistent branding and marketing messages across all devices — web, mobile, and tablet. Mozu also allows you to manage inventory and fulfillment all from within the same admin panel. The Mozu platform can integrate many popular merchant service providers, such as ChannelAdvisor, Kount, FedEx, and McAfee, making for a more seamless experience. Like Demandware and other cloud-based platforms, Mozu claims to limit headaches that are often associated with maintaining a self-hosted e-commerce platform.
Price: The cost of Mozu is estimated to start above $10,000 annually, but merchants need to contact Mozu directly to learn how much they would need to pay (depending on their business size and which features they would need).*
Ultimately, the choice of which e-commerce platform to use depends on your particular needs. Are you an established retailer looking for a robust platform that unifies your view of customers across all channels? Are you launching a new retail presence? Do you need to keep your costs below $200 per month? Or are you willing to pay any price for the right solution? Whatever the case may be, there is a good e-commerce platform out there that can address your needs.
A few questions you should ask in order to help you make your decision are:
- How many product listings do I need?
- What do I want my website to look like?
- Am I willing to pay more for custom designed themes?
- How much revenue do I make?
- Do I want to pay a monthly fee?
- Do I want to pay a fee per every transaction?
- Do I need to integrate with eBay or Amazon?
- Do I need to integrate with other service providers?
- Are there special needs I must address (payments, omni-channel, order fulfilment, etc.)
- Do I want a full-service suite that connects all facets of my business?
With the answers to these questions and the information above, you’ll be prepared to find the exact right e-commerce platform for your business.
*Costs as of September 30th, 2015
DISCLAIMER: The views contained in this article are those of Affirm only. Affirm has partnerships with Bigcommerce, Demandware, Magento, NetSuite, Shopify, and WooCommerce. Affirm has not received any consideration whatsoever for creating this article.