Shopify vs Amazon (Feb 2021): Which Should You Choose?

How to Choose Between Amazon and Shopify

When it comes to selling products online, there are tons of options to consider these days. Business leaders can choose to build their own online store, complete with access to a payment processor, subscription, and membership options, and so much more. Alternatively, for some beginners, the better option might be to simply sell through an existing marketplace, like eBay, or Etsy.

In today’s digital sales landscape, there are two names that seem to stand out above all the rest. Shopify is the go-to solution for companies that want to build their own website from scratch. Any small business can develop an online store with Shopify and start taking credit card and debit payments in no time.

Alternatively, if you want to start selling as quickly as possible, you might choose to set up an account with Amazon. As an Amazon seller, you get access to a huge audience full of people who already browse Amazon on a regular basis.

Both of these tools have their benefits to offer, so how do you make the decision of which one you should be using?

Let’s find out.

Shopify vs Amazon: The Basics

Let’s start by looking at what individual sellers and business owners can do with both Shopify and Amazon. The first thing that you need to know is that both of these tools will allow you to make a name for yourself as a retailer. You can make money online with your own ecommerce store, or you can sell easily through an online marketplace.

However, that’s just about where the similarities of Amazon and Shopify come to an end. Both Amazon and Shopify are a means for selling products in the digital world, but they work in very different ways.

With Shopify, you get an entire platform to build your eCommerce website, complete with templates so you can make your product listings look incredible. Depending on which Shopify package you choose, you can access everything from search engine optimization features to tools that allow you to link your store to other sales channels – including Amazon.

On the other hand, Amazon doesn’t ask you to build anything from scratch. Instead, you sell through a pre-existing warehouse, alongside other sellers similar to you. Selling in Shopify is like renting a building in the real world and selling your own products, whereas Amazon gives you a stall among thousands of other sellers in a very busy environment.

The major difference in the business models that you can embrace with both Shopify and Amazon mean that these tools cater for very different online sellers. Shopify is ideal for small businesses, larger brands, and individual sellers who really want to make a name for themselves online. Alternatively, the Amazon environment might be a better choice if you’re just one person selling a small volume of products.

As your online business grows, you may even choose to use both solutions.

Shopify vs Amazon: Pros and Cons

So if both Shopify and Amazon can help you make money in the evolving digital world, how do you choose the right option? When comparing these solutions, it can help to list the obvious pros and cons of both tools, for instance:

Shopify Pros 👍

  • No concerns regarding updates and security (everything is done for you)
  • User-friendly way to build your entire branded store
  • Integrations with tons of additional tools, including Amazon
  • Premium and free templates to make your site look great
  • Offline selling opportunities and POS integrations
  • Fantastic support from a complete team
  • Various marketing and SEO tools for growth
  • Popular community with tons of happy customers
  • Sell services or physical products

Shopify Cons 👎

  • Transaction fees eat into your profits
  • Costs add up for things like integrations, and templates
  • Requires you to build your entire store before you begin selling

So, how does Amazon compare? It might offer a very different experience for online sellers, but it still has various pros and cons to consider.

Amazon Pros 👍

  • Fantastic brand exposure (millions of people use Amazon)
  • Easy to set up and start selling instantly
  • Access to tools like FBA (fulfilled by Amazon)
  • Offer gift cards, discounts and more
  • Great shipping fees in most cases
  • Security and updates are managed for you
  • Convenient back-end environment
  • Good customer support

Amazon Cons 👎

  • Only suitable for selling physical products
  • Difficult to build a strong brand image on a marketplace
  • Lots of competition from people selling the same, or similar products

Shopify vs Amazon: Pricing

Now that you’ve had a closer look at the pros and cons of each service, let’s get down to brass tacks – how much you’re going to spend. Both Shopify and Amazon have costs that you need to consider when you’re planning a way to increase your profits.

Shopify, despite its extensive range of features and tools, is usually regarded as quite affordable. If you already have a business website, or a social media store that you want to sell from, then you can simply add a “Buy Now” button to your account with Shopify for a tiny $9 per month – this is the Shopify Lite package. The Lite package doesn’t allow you to build your own website or access the countless additional features of Shopify, however.

Other package options include:

  • Basic Shopify: $29 per month, with access to unlimited product hosting, online store tools, staff accounts, 24/7 support, social media integrations, discount codes, SSL certificate, gift cards, abandoned cart recovery, and more.
  • Shopify: $79 per month, this is the standard version of Shopify that most companies choose; it includes all the features of Basic, plus up to 5 locations, 5 staff accounts, and professional reports. There’s fraud analysis, POS technology (Lite), and the option to sell in multiple languages too.
  • Shopify Advanced: $299 per month, this package is designed for larger companies selling at scale, you can sell in up to 5 languages, access international domains, unlock fraud analysis, and so much more, plus you get premium service.
  • Shopify Plus: This is Shopify's enterprise version, although you need to speak to a Shopify professional to get the pricing for this. Usually, costs will start at around $2000, so be wary that you should have a decent budget.

Aside from extra features, the higher you go in terms of Shopify plans, the more you save on transaction fees. For instance, online credit card rates for Basic Shopify start at 2.2% plus 20 cents, while in-person rates are 1.7% plus 0 cents. Additional fees for all payment providers other than Shopify Payments are 2%.

If you use Shopify Advanced, however, your online credit card rates go down to 1.6% plus 20 cents. In-person rates are 1.5% plus 0 cents, and additional fees for transaction companies beyond Shopify payments are 0.5%.

So, how does Amazon compare?

Amazon isn’t particularly pricey either, making it a decent choice for companies and sellers that are just getting started online. There’s no point in choosing a platform that’s going to cost you hundreds of dollars if you’re not selling massive amounts of products.

Amazon’s selling plans are:

  • Individual selling plan: There’s no monthly fee for this service, but you will pay a $0.99 fee for every item that you sell. This is on top of the extra selling fees that can emerge when you’re selling on Amazon, which vary by category.
  • Professional selling plan: This is the plan with a monthly fee which costs $39.99 per month. There are still extra selling fees to pay here from other parties. Once again, the third-party fees will depend on what you have to sell.

So, why would you consider using the Professional plan? Well, Individual selling accounts allow you to sell in a variety of open categories, and access feeds and spreadsheets to load inventory information online. However, your options for other features are extremely limited. The Professional plan, on the other hand, allows you to access order-related feeds and order reports. You get top placement on all of your product detail pages, and you can apply to sell in 10+ extra categories. You can also customize your shipping rates.

As you might expect, there are more features to unlock on the professional plan, which gives you more opportunities for extra sales. If you choose to use other Amazon services, like Fulfilled by Amazon, there are extra fees yet again.

Fulfilled by Amazon allows you to access easier order fulfillment across the world, and you can also get access to things like Prime shipping. Prime shipping is a huge bonus for a lot of customers selling on Amazon these days, and you also get a fulfilled by Amazon badge.

Unfortunately, there’s no way to really predict how much you’ll spend on FBA, because you don’t get a price until you reach out to the team and share your requirements.

Shopify vs Amazon: Features

Whether you go for Shopify or Amazon as your selling solution, it’s important to note that you’ll always get more features if you’re willing to pay more. That’s a standard truth of any online selling solution. Let’s take a closer look at the kind of features that you can expect from both Amazon and Shopify, and how they’re going to affect you.

Shopify Features

shopify homepage - shopify vs amazon

Unless you choose the “Lite” package for Shopify which only gives you access to a sales button, you should be able to unlock a decent amount of features on virtually any Shopify plan. That’s one of the best things about Shopify, and a reason why the solution is one of the most popular in the world for selling. You can even edit your website with HTML and CSS and take payments through more than 70 payment providers.

Shopify give you a host of great premium and free templates to assist you with building your online store. Plus, there’s plenty of ways to customize by making your own edits, implementing add-ons and accessing integrations. There’s even things like reporting and analytics to help you better understand the needs of your customers.

Features include:

  • Dozens of payment processor options
  • SSL certificate for security
  • Premium and free themes
  • Drag-and-drop editor for your website
  • Abandoned cart recovery
  • Customer accounts and profiles
  • Fulfilment and dropshipping
  • Product testimonials and reviews
  • Inventory and order management
  • SEO and marketing functionality
  • Customer accounts and profiles
  • Automatic tax calculation

The features available for Shopify users are always evolving, with new functionality appearing all of the time. There’s also the Shopify market to discover too.

Amazon is a little less feature rich than Shopify in some ways because you’re not getting an online store builder. Instead, all you need to do is create an account and you can start selling to a massive audience almost immediately.

Amazon Features

  • Reach new customers using Amazon Business
  • Automatic VAT invoicing
  • Business pricing and quantity discounts
  • Unique business offers and deals
  • Enhanced order visibility
  • Pay by invoice functionality
  • Fulfillment by Amazon
  • Product picture and video support
  • Easy access to back-end product page edits
  • Shipping calculation
  • Hosting and security included

Amazon also helps you out with shipping products to customers. Just as Shopify has extensions for dropshipping, Amazon can fulfil your sales with Fulfilled by Amazon. FBA takes the headaches out of things like shipping and ecommerce, so you

Shopify vs Amazon: Payment Options

shopify payments - shopify vs amazon

Payment options are an important consideration when you’re building an online store. The more customization you can tap into for payment, the more likely it is that your customers will buy your products. People always feel more comfortable using the payment methods that they’re already familiar with.

Whether you have a simple or advanced Shopify store, it’s worth remembering that you will pay transaction fees unless you go for the Shopify Payments gateway. This means that you no longer have transaction fees to worry about, but you’ll be limited to selling through Shopify’s service alone.

If you don’t mind paying the transaction fees, then Shopify does have other payment options too. There are more than 100 choices available, including PayPal and Amazon Pay, all od these options have transaction fees that vary in price, so make sure that you do your research.

Amazon takes a similar approach to Shopify with payment methods. Amazon Pay is the main payment gateway available, and it allows you to accept all kinds of debit and credit cards. You can’t access PayPal, unfortunately, or other payment solutions, but most people feel pretty comfortable with Amazon Pay anyway.

For professional sellers, Amazon has selling fees to consider, as well as a monthly subscription. Fees vary by category, and often include both shipping and referral fees. If you choose to use Fulfilled by Amazon, there are various additional fees to think about for the fulfillment process. On top of that, you’ll need to consider monthly inventory storage fees too. The prices for storage and fulfilment depend on the size, type of product, volume, and time of year.

Shopify vs Amazon: Design and Customization

There are a lot of differences separating Shopify and Amazon.

Because Amazon is a marketplace, your customization options are limited. That’s not the case with Shopify. Shopify allows business owners of all sizes to design a fantastic storefront and showcase their products as a professional seller.

There are tons of great theme options to choose from, both free and paid, and you get the benefit of exceptional ease of use too. There are keyboard shortcuts to help you out, and an easy undo functionality to help with moving through various changes as quickly as possible. Shopify also makes it easier to get started with tons of themes to choose from.

Shopify is an excellent way to make a website that really stands out, with everything you need to launch a store that works for you. Although Shopify has more eCommerce features than website building features to speak of, it’s still a decent solution for design, and much more flexible than building a store with Amazon.

One slight issue is that you can’t change your theme after you’ve picked it without starting over, however, so make sure you’re sure about what you want to do.

Amazon, as an online marketplace, allows companies of all sizes to sell products in high volume with minimal hassle. Unfortunately, it’s much more limited from a customization perspective. You can’t build your own site to display your products on. While you can upload your own product images and descriptions, your listings will look like anything else on the marketplace.

Amazon promotes products on the homepage without business branding, and although customers can visit your store page on Amazon, they’re unlikely to build much of a significant connection with your brand through this, as you can’t choose your own colors or brand options.

Shopify vs Amazon: Sales Management

Shopify and Amazon are both intended to make your eCommerce startup as simple as possible.

Shopify is extremely easy to use, and one of the most feature-rich options for online stores in the market today. You can track your sales in real-time and set up alerts to monitor inventory. Shopify also integrates with various other sales platforms like Amazon, eBay, and Facebook. You don’t have to be an expert in HTML or PHP to start selling, you can just jump in.

With Shopify, you have everything you need to build a store, and attract customers through SEO features and advertising tools. You can integrate with email marketing and social media selling strategies, create user ratings for social proof, and even manage your own abandoned cart campaign if someone leaves your site without buying.

You can work with over 100 external payment processors, sell digital or physical goods, with discounts, coupon codes, and more. There’s also the option to access multiple shipping solutions, handle tax settings, and access dropshipping functionality.

Amazon also offers plenty of selling tools for beginners. You can sell a wide range of products here, through the Amazon marketplace, although you won’t get to build a site from scratch like you would with a Shopify store.

Amazon supports your ecommerce business in a variety of ways, with the option to sell handmade products, ship items across the globe, and even create targeted adverts. One of Amazon’s biggest selling points is Amazon FBA, which allows you to access professionals who can ship your items for you. FBA also gives you access to Amazon Prime, which is a great way to generate more interest from your customer base through speedy shipping.

All you need to do to use FBA is send your products to Amazon, and they’ll do the rest for you – from packing each item, to making sure that it gets to your customers at the speed you choose.

Shopify vs Amazon: Using Both Tools

One option if you’re struggling to choose between Amazon and Shopify, is to use them both together. These two tools are pretty well matched, as they’re both very different ways to run an eCommerce business. With Shopify you can build your own store and start making a name for your brand. With Amazon, you can find another avenue for sales, and take advantage of a huge existing audience.

Integrating Amazon with your Shopify store is easy, thanks to Amazon’s vast marketplace and open integration policy. All you need to connect the two systems is set up an Amazon seller account and add the Amazon Sales channel to your store.

The main thing to be aware of is that you still need to pay for your Professional Amazon account. You’ll be paying your subscription to Shopify at the same time though, so this might eat into your budget quite a bit. Most people will probably focus on using Amazon and Shopify together when they’re scaling their business.

If you’re looking to build on top of an audience that you already have or you just want a new avenue for selling, then Amazon is a great addition to your existing Shopify strategy. With Fulfilled by Amazon, you don’t really need to take on a lot of extra work either.

It’s a bit like stocking your product on a shelf in Walmart, but also having your own store and WordPress site. Amazon and Shopify together can allow you to access the best of both worlds, if you have enough cash.

Shopify vs Amazon: Verdict

Shopify and Amazon are very difficult to compare like for like. Although both of these tools will help you sell online, they have very different focuses. With Shopify, you build your own store, and a brand, although you may have to think about warehousing per cubic foot without access to something like the Amazon warehouse.

Shopify, as an ecommerce platform, gives you all the eCommerce tools you need to thrive, even if you’re looking into multichannel selling. With Amazon, you can add any items you want to sell to the product category they fit on within a huge existing marketplace. While you’re using your Shopify POS and tools to build a brand, you can access Amazon as an easy form of additional sales.

Both options have their benefits – and they work well together too. It’s up to you to choose which option is right for you.

Rebekah Carter

Rebekah Carter is an experienced content creator, news reporter, and blogger specializing in marketing, business development, and technology. Her expertise covers everything from artificial intelligence to email marketing software and extended reality devices. When she’s not writing, Rebekah spends most of her time reading, exploring the great outdoors, and gaming.