Amazon vs Shopify in 2023? Which Platform is Best for Building Ecommerce Brand
You are now ready to start your own online store business. But you have been thinking, wondering, and asking yourself which is the best platform to build your business?
After comparing different options you are left with two options on the table: Amazon and Shopify.
You want facts and proof that will help you make your final decision on the platform you want to choose. If that’s you, this article is for you.
This article will show you, walk you through the two platforms and help you make your decision on the best one to choose.
You will learn things like:
- The features of the two platforms
- Benefits of comparing the two platforms
- The advantages and disadvantages of each platform
- How each tool will help you run your eCommerce business
- How to integrate between Shopify and Amazon
It is also important to know that you can promote affiliate link as you use any of these sites that can lead to more earnings for people who use your links.
Why Compare Amazon vs Shopify at All?
Nowadays, every business needs to build its brand online to become successful. For that reason, it’s imperative to compare Amazon vs. Shopify to understand their differences.
So, if you plan to start an online or eCommerce business, it’s essential to choose the right marketplace or e-commerce platform to build your brand successfully.
In that case, should you go with Shopify or Amazon?
Before you decide, it’s important to note that Amazon is just an online marketplace while Shopify is an e-commerce platform.
Millions of shoppers visit Amazon, providing sellers with a vast customer base. But, on the other hand, Shopify allows merchants to create their business spaces and run them.
Why Do You Need to Build a Brand?
Most manufacturers are now selling products directly to customers (D2C). As a result, they have become the top competitors to many sellers on both Amazon and Shopify.
In most cases, such companies use an alternative, cheaper branding even though their products might be similar or identical to yours.
So, to outdo the D2C manufacturers and build your brand, you need to be keen on the quality of service you provide and the choice of products you offer to your consumers.
Also, the choice of products to sell or stock depends on who you plan to sell to online. For that reason, you need to understand your own customer base to build your brand.
Building a Brand on Shopify
Shopify is an excellent eCommerce platform as it provides sellers with Shopify apps with the latest features that Amazon can’t offer. That makes it easy to build your brand.
Pros of Building a Brand with a Shopify Store
Here are the advantages of building a brand with Shopify.
- Shopify is Brand-Friendly
Shopify allows you to use your brand name in the domain, unlike Amazon, where one has to use an Amazon domain to brand their stores. That makes Shopify more brand-friendly.
- Shopify Fosters Independence
When you create a Shopify store, you become independent of Shopify, allowing you to personalize and build your brand. It’s like renting a storefront for your business.
- Shopify Gives Sellers Full Control of their Brands
Unlike on the Amazon marketplace, nobody rates your store on Shopify. That gives you the flexibility to adjust prices and also allows you to build trust in your brand on Shopify.
- Shopify Provides Powerful eCommerce Tools
Shopify offers a vast range of eCommerce tools, including third-party apps, to help sellers build and promote their brands online. Some of the tools include Shopify Pitch Decks, Shopify Branding Assets, and Shopify Sales Resources.
Cons of Building a Brand with Shopify
Despite the advantages, Shopify also has a few setbacks, including:
- Costly Customization of Shopify Stores
Although it’s possible to customize Shopify on higher plans, it might not be easy to access all the Shopify pages. Besides, Shopify’s templating language uses some elements of PHP, making customization costly.
- Shopify Limits Access to KPI Reporting for Cheaper Plans
KPI reporting helps to provide professional reports regarding your business performance. However, Shopify’s pricing plans don’t provide access to KPI reporting, making it difficult for sellers with cheaper plans to understand the behaviors of their customer base.
Building a Brand on Amazon
Source: Repricer Express
Like Shopify, Amazon is doing everything possible to make its marketplace more engaging and brand-centric. It has rolled out incredible features to help members build their brands.
Pros of Building a Brand with Amazon
Here are a few advantages of building a brand with Amazon.
- Amazon Already Has Traffic and Brand Power
Amazon is a powerful brand itself. Your brand gets automatically boosted when your store gets listed on the platform. So, you don’t need to put a lot of effort into Search Engine Optimization (SEO) and paid marketing. Research by Statista shows that Amazon has over 2.7 billion website visitors by June 2021.
Also, millions of shoppers visit the marketplace monthly, giving your brand more exposure.
- Amazon Allows Merchants to Open Stores Within the Platform
You can create a microsite (Amazon Store) to access several branding opportunities offered by Amazon. Such features include internal linking and multiple pages. You can also market your store on social media and track the performance using Amazon’s Brand Analytics.
- Amazon Provides eCommerce Resources to Build Your Brand
When selling on Amazon, you’ll gain access to several resources such as shipping discount codes, shipping and fulfilment services, and Amazon customer service. Also, Amazon will take care of your inventory, packaging, and shipping, making it easy to build your brand which is commonly referred to as Fulfillment by Amazon (FBA).
Cons of Building a Brand with Amazon
Like other online marketplaces, Amazon also has a few disadvantages, including:
- Amazon Sellers Lack Full Control Over Their Brands
One problem with Amazon is that sellers rely entirely on the platform’s search algorithm. Unfortunately, Amazon can tweak its algorithms for their benefit over the merchants. As a result, that denies sellers complete control of their brands and pricing.
- Amazon Has Many Cases of Fraud and Bad Behavior
Some sellers use everything at their disposal to outdo competitors, even if it means tricking the system or customers. For example, a seller may look for fake reviews, reducing buyers’ trust in Amazon. As a result, that makes Amazon less appealing for brand building.
Shopify vs. Amazon FBA Platform Capabilities
Now that you are aware of the pros and cons of Amazon vs. Shopify, it’s vital to learn how they differ. Amazon is an online marketplace, while Shopify is an eCommerce platform.
In other words, Amazon has millions of potential buyers worldwide in a single marketplace, while Shopify provides tools to help sellers build stand-alone online brands.
Here are the other differences between Shopify vs. Amazon
Category 1: Ease of Use
Setting up an eCommerce store is no longer difficult, especially with Amazon and Shopify. Although the two platforms are different, each offers a smooth selling experience online.
For example, Shopify’s design allows even the most inexperienced online sellers to create eCommerce websites. It boasts super-easy navigation, neat design, and many help pages.
Thankfully, Shopify avails top-notch sales tools to help merchants build their brands.
On the other hand, Amazon has made selling easier as it doesn’t require sellers to create websites. Instead, all you should do is create an account and set it up to start selling online.
Once you create your own store on Amazon, all you have to do is list your items for sale. You can even ship them to customers by yourself or opt for Fulfillment by Amazon (FBA).
With Amazon FBA, you only have to worry about making sales. Amazon will take care of inventory management, shipping services, and other eCommerce tasks.
Category 2: Design & Customization
Nothing frustrates an online shopper more than a poorly designed online store. For that reason, it’s vital to create and customize your store to make it look simple and attractive.
The good news is, both Shopify and Amazon offer stunning designs to attract shoppers. However, the customization options are more limited in Amazon than in Shopify.
Shopify allows sellers to design beautiful storefronts and list their products, making them more professional. The platform has many free and paid themes.
Shopify also gives merchants control over their online store’s layout and design. Instead of designing a store from scratch, you can customize one of the themes to match your brand.
On the other hand, Amazon is more limiting when it comes to designs. That’s the reason all Amazon pages have the same layout and design, making your store look like other sellers.
You can’t build your own website with Amazon or customize your Amazon store page to match your brand. So, your listings will look like any other product on the platform.
So, when it comes to design layout and flexibility, Shopify wins
Category 3: Domains and URLs
When you want to build your brand identity online, you need to use the right domain and URLs. That’s because customers prefer shopping in online stores with custom URLs.
Thankfully, Shopify comes with everything you’ll need to build a successful eCommerce website, including a free hosted domain. You’ll also access custom templates for your site.
Besides getting a free domain, you’ll enjoy free hosting for your site. For that reason, you don’t have to buy another domain after purchasing a Shopify Package.
When you’ve grown your business and made enough money, you can get a new domain and a custom URL for your online store. As a result, this will improve your brand identity.
On the other hand, Amazon doesn’t allow sellers to customize their domains or URLs. So, you have to do what Amazon wants because you are selling on their platform.
Since you don’t need to build a domain with Amazon, you can start selling on the platform after the setup process. However, that’s different from what happens with Shopify.
Category 4: eCommerce Features and Tools
Both Amazon and Shopify have robust tools and features to help sellers trade their products on the platforms. However, such tools are more in Shopify than in Amazon.
People sell a vast range of products on Amazon, from books, toys to electronics. So, the platform has introduced several eCommerce tools to facilitate the sale of these items.
An excellent example of the Amazon tools is Fulfillment by Amazon (FBA). The program lets Amazon handle the storage inventories, packing, and shipping of products. It also allows Amazon sellers to reach out to Amazon Prime customers.
So, how does Amazon FBA work?
All you have to do is send your goods to Amazon, let them package and ship them to your customers. However, you will have to pay a small monthly fee (referral fee) for the Amazon FBA service.
Shopify has more eCommerce tools than Amazon to make your online store easy to use. Not to mention, it has partnered with OBERLO to help drop-shipping businesses.
Here are some of the eCommerce tools you’ll see on Shopify.
- Theme Module Spreadsheet
- Shopify Branding Assets
- Design Brief Template
- Burst Stock Photography
- Ecommerce UI Kit
Category 5: Payment Solutions and Fees
When creating an eCommerce store, it’s vital to consider payment options. When your payment solutions are well-optimized, your conversion rate increases.
It is important to ensure your ecommerce store is mobile optimized to help your target customers can do transactions on their mobile devices.
If your target customers can’t access your store on their smartphones you miss a chance to convert them into customers.
Research shows that 44.5% of customers use mobile wallets when purchasing products through ecommerce sites.
Since customers prefer using different payment options, have a variety of options on your ecommerce store customers can use to pay for the products they purchase.
Statista reports that 51% of UK customers prefer debit and credit cards when making online payments.
Besides payment options and the upfront costs, the transaction fees also matter a lot. For example, online credit card rates and transaction fees can raise your monthly fees.
Notably, Amazon uses Amazon Pay as its primary payment option. It allows sellers to accept payments through credit and debit cards. However, it doesn’t support PayPal.
Besides the Amazon selling fees, Amazon charges monthly subscriptions for “Professional Selling plans.” The charges comprise the referral and shipping fees (for Amazon FBA).
- Fulfillment fees (per unit): $2.41 – $137.32
- Monthly inventory storage fees: $0.69 – $2.40 per cubic foot
Note that the extra selling fees vary based on the volume, size, and type of items you sell. Also, individual sellers only pay $0.99 for each item they sell.
On the other hand, Shopify sellers use Shopify Payments to sell online without having to pay transaction fees. Thankfully, it offers over 100 payment options, including PayPal.
Notably, the transaction fees for these payment gateways range from 0.5% – 2.0% depending on the method you intend to use.
When it comes to payment solutions and fees, Shopify wins. It has over 100 payment options, including Shopify Payments, for your own online store.
Category 6: Sales Management
The best e-commerce platform should foster efficient sales management. Thankfully, both Amazon and Shopify strive to make your eCommerce startup simpler.
Shopify has a plethora of tools to improve sales management in today’s market, including Sales Team and Point of Sale. Besides, it is easy to navigate as sellers can track sales and monitor inventories in real-time.
Shopify also integrates perfectly with other top sales platforms like eBay and Amazon. Also, it has many external payment options, making it easy for customers to pay for products.
Like Shopify, Amazon also provides several tools that beginners can use to manage their sales, including the FBA Restock Tool and Stranded Inventory Tool. In addition, the marketplace also allows sellers to stock a vast range of products.
Amazon’s most significant selling point is the Fulfillment by Amazon (FBA). It allows a seller with a professional Amazon account to delegate the shipping process to Amazon.
With Amazon FBA, you can access Amazon Prime, allowing you to fulfill your customers’ interests, such as speedy shipping, and generate more sales.
Category 7: Merchant Support Systems
When something goes wrong with your eCommerce store, you’ll count losses if you don’t restore it promptly. In that case, you’ll need urgent help from the customer support team.
Notably, Shopify offers the best merchant support services in the eCommerce industry. Its dedicated support team understands that each second your shop is down, you lose money.
Shopify provides support 24/7 through various platforms, including support forums, live chat, and email to ensure exceptional customer services.
Live chat is the most efficient method sellers can reach out to Shopify’s customer support team.
Superoffice data shows that 46% of customers prefer live chat to other communication channels like email.
Thankfully, a Shopify Plus account has access to a dedicated support consultant.
Unfortunately, for Amazon, customer support is not as immediate as in Shopify. However, whenever you have an issue, you can prompt the phone call request function.
The only disadvantage is that you will have to wait for the phone call when you request it. Besides that, you can count on help from Amazon’s community forum.
So, when considering merchant support systems, Shopify wins. Its customer support team is always available to take care of the merchants’ needs.
Category 8: Pricing Comparison
Before subscribing to Shopify or Amazon, you must know your budget. Both eCommerce platforms have costs that you have to account for when starting an online business.
So, how much are you willing to spend, and what’s the pricing for each platform?
A basic Shopify plan is quite affordable despite having many features and tools. It is even cheaper when you already have a website to sell from because you won’t create a new one.
Shopify has plans with different pricing, including the most expensive Advanced Shopify:
- Basic Shopify plan: $29 every month
- Shopify: $79 every month
- Advanced Shopify: $299 every month
What about Amazon’s pricing?
Just like Shopify, Amazon is not costly. As a result, it’s a perfect place to get started as an online seller. It has two selling plans with different prices, depending on their features.
Here are Amazon’s selling plans.
- Individual Selling Plan: $0.99 per item sold
- Professional Selling Plan: $39.99 per month
Note that the individual selling plan is ideal for people who sell less than 40 items monthly. Unfortunately, it lacks some features that the Amazon professional seller account provides, such as special listing features, promotion & gift services, PPC, and ‘buy box’ features.
Examples of Successful Brands Using Both Shopify and Amazon
Now that you know the differences between Shopify vs. Amazon, you can select what fits your new business perfectly. However, it’s not wrong to diversify and use both platforms.
Target customers trust brands that other customers have used and have seen great success as they run their business on both platforms.
Worried if your business will be successful as you run it through these platforms?
Don’t worry. Here are some of the big brands that are massively growing their business through these platforms. They include:
- Kylie Cosmetics
- Whole Foods Market
- Red Bull
Founded by Kylie Jenner in 2015, Kylie Cosmetics sells beauty products and accessories like concealers, eyeshadow palettes, highlighters, and blushes.
Kyle cosmetics is a brand in the beauty and personal care industry. To effectively reach their target market and sell their products they use Amazon and Shopify sites.
Source: Kylie Cosmetics on Shopify
Doing a simple search for the brand “ Kylie Cosmetics” on amazon shows you these great results. The different products target customers can purchase through the Amazon site and help the business generate more sales.
Source: Kylie brand on Amazon
Source: Kylie Cosmetics on Amazon
Whole Foods Market
Whole Foods Market is among the best food markets that use Shopify and Amazon to sell their products.
It has over 350 supermarket chains in the United States, United Kingdom, and Canada. Notably, it exclusively markets natural and organic foods and products.
This is a great brand with different store outlets in different countries. Using Shopify and Amazon has given the brand a high leverage to reach more target customers in these different countries.
As they offer different food products, they are able to capture a wide market for their business and increase revenue through the use of the Shopify and Amazon platforms.
Source: Whole Foods Market on Shopify
Source: Whole Foods Market on Amazon
Red Bull is one of the best-selling energy drinks worldwide, marketed through advertising, celebrity endorsements, and sports team ownership.
It also has merchandise on Shopify that deals with jerseys, T-shirts, jackets, caps, and many more.
As one of the best energy drinks brands, Red bull, has leveraged the power of influencer marketing to reach a larger audience for their products.
Alongside that, they have used Shopify and Amazon to grow their customer base and increase sales and revenue for their brand.
Source: Red Bull on Shopify
Here is a screenshot of some of the red bull products on Amazon and their prices.
Source: Red Bull on Amazon
Integrate Both Ecommerce Giants With Each Other
Now that you know that you can use both Shopify and Amazon to build your brand, it’s essential to learn how to Integrate Shopify with Amazon.
Integrating Shopify with Amazon will help you tap Amazon’s traffic to your product listings without having competitors’ products nearby. However, you’ll still pay the Amazon fees.
How To Integrate Amazon FBA with Shopify
You can add Amazon to Shopify in two ways: shipping options and product listings.
Here are the steps to follow when integrating Shopify with Amazon.
Based on Shipping Options
- Get a Shopify account and an Amazon Seller account
- Go to the Amazon MWS and agree to the terms and conditions
- Edit your Shopify website’s options to match your details on Amazon
- Update your shipping options to match what Amazon offers, whether One-Day Shipping, Two-Day Shipping, or Standard Shipping.
- Set your new shipping rates based on the guidelines on this Amazon’s page
- After adding the new rates, scroll down to the page’s bottom and click “save.”
How To Integrate Shopify with Amazon
To configure your Shopify products for fulfillment by Amazon, follow these steps.
- Click the Shopify Admin Menu, then select Products > All Products
- Select the item you intend to authorize for fulfillment by Amazon
- In the “Shipping” tab, choose “Amazon Marketplace Web” in the “Fulfillment Service” menu
- Go to “Inventory” then “Inventory Policy” menu and select “Amazon Marketplace Web tracks this variant’s inventory.”
- Verify if the data in the weight and SKU fields match what’s in your Seller Central account
Why should you choose Shopify over Amazon FBA online marketplace?
Why should you choose Amazon FBA over Shopify online store?
If I have little to no capital, should I Select Amazon or Shopify?
If you have little capital to build an e-commerce site, you can start with Amazon. It offers an Individual Plan, which is ideal for beginners. Also, the monthly subscription fee is low.
After selling many products and earning more money, consider scaling up the business to Shopify. Thankfully, building an eCommerce website on Shopify is easy.
What payment processing options can I use with Shopify?
Over 100 payment processing options are available on Shopify, including credit and debit card options. In addition, you can also use online payment options such as PayPal and Stripe. Notably, some options allow you to accept payments in cryptocurrencies.
Is it possible to use both Amazon FBA and Shopify altogether?
Yes, you can use Amazon FBA with Shopify to improve your brand awareness and online presence. You need to open an Amazon selling account and a Shopify store to get started. After linking the two e-commerce platforms, you can track your sales on both platforms.
Amazon vs Shopify
So my advice, you should only sell on Shopify if you’re interested in learning marketing, Facebook ads, copywriting, etc then selling on your own site is a great option and Shopify is the best platform to make your life a little easier getting started.
On the other hand, if you’re a beginner in the eCommerce industry and have no marketing skills, choosing Amazon is a wise option.
You’ll have to get really good at picking the right products and differentiating your products, sourcing and creating a unique brand out of them to get a competitive advantage.
And you can leverage FBA service to essentially not go through most of the hassle.
Having the right information and knowledge is essential as you make your decisions for the platforms to use to start an eCommerce business.
This guide has given you all the insights on the Shopify and Amazon platforms to help make the right decision.
If this is your first time running an eCommerce business, Amazon FBA will be the best option for you.
They will take care of brand marketing challenges as you scale your business. Then you can add Shopify to your brand marketing as your business grows.
Use the insights from the content as you take action and choose the platform to start growing and scaling your business in 2023.
Ensure you keenly evaluate the different features and information to help make the right decisions.