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Is Shopify Too Saturated?

Oct 11, 2020

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When I first wanted to start my own e-commerce store, I saw that many people recommended Shopify. Because so many people were recommending, then I thought everyone must be doing it. So, I did some research into whether Shopify is oversaturated and put together this helpful article to explain what I found.

So, is Shopify too saturated? Only 0.13% of the world’s population have a Shopify store, according to recent data. This means, only a small handful of people have Shopify stores. Also, a recent study showed that about 5% of all retail sales are made in online stores. Which means there is room for growth.

Shopify is also only one type of platform that is used to do e-commerce online. Woocommerce is one of the more famous ones. There are also online marketplaces such as Amazon.com that compete directly with Shopify. Below, I’ll explain the actual numbers around how saturated or unsaturated Shopify is.

How to tell whether Shopify is too saturated

A trend towards people doing their shopping online has been developing once the internet became widely available – since about 2010.

But, it was shown by recent data put together by Digitalcommerce360.com that the amount of sales made on online stores is still only a tiny percentage of all retail purchases. Based on their data, under 5% of all retail purchases are done online. But, the trend is going up slowly.

This means that online stores – which is what Shopify is – are not yet even remotely close to competing with physical stores. So, Shopify itself is not too saturated in the retail industry and has room to grow.

But, how does Shopify compare to other e-commerce platforms?

Barntobark.com reports that Woocommerce used to display the number of downloads they have had on their homepage, and the figure was around 80 million. But, Woocommerce has removed this data, and I have been unable to find it after a lot of research.

Please let me know if you are able to find it, and I will gladly include it in this article. Maybe it’s a closely guarded secret.

Although people may have downloaded it to see what the software is like to use, and don’t have an active e-commerce website. They could have also found a better option and switched to a different e-commerce platform after downloading it.

Builtwith.com, however, states that there are just under 4 million websites that are currently using the Woocommerce software.

About 4 million appears to be a good estimate of the number of e-commerce websites that are using Woocommerce. When you compare that to Shopify – it has only 1 million – so from the numbers suggest that Woocommerce is more saturated than Shopify.

This means that Shopify has significantly more market share they can acquire before saturating the market.

Market share is all the businesses that own e-commerce websites and is a term used to describe how businesses compete. One business may run some marketing ads to attempt to get customers using one product to use another.

This is only reserved for industries that are saturated. Where everyone already uses a version of the product.

However, in the case of Shopify, Woocommerce, and other e-commerce software providers, there is such a large room to grow that Shopify would need to acquire more market share and service the existing demand for online shopping before becoming saturated.

Is Amazon filling the void that is created by the lack of e-commerce stores?

It does call into question whether Amazon is taking up space. Since Amazon is one of the largest e-commerce platforms in the world, together with other massive websites such as Alibaba.com, and whether they are capturing all the online shoppers that are forced to go instore.

Shopify reported that as a result of Covid-19, they saw double the amount of sales. The sales came from websites that use their Shopify platform.

In my opinion, this is because all the retail stores were closed, and people couldn’t go to physical stores. I remember Amazon pretty much ran out of every product they had because of all the demand they got during that time.

Although sales were all Covid related, due to retail stores couldn’t stay open. It was also reported that for the first time ever online sales overtook sales made in physical stores during Black Friday of 2015, with the famous headline ‘Clicks beat bricks.’ So, there appears to be a big trend towards physical retail stores switching almost exclusively to online stores.

I think some business owners have seen that this trend is happening and have already opened up online stores, and are gaining customers that the physical stores have lost as a result of the Covid crisis.

In my opinion, once a customer has a good experience with one online store, they will continue to use them due to convenience and price. As there is little to no incentive for them to go back to a retail store. Some items people like to buy in a store because they can try them on, or see how it looks.

However, I have noticed over the years that online stores have become better. For example, they are now using sizing guides and videos. Thus going into a physical store is no longer a must-do.

Is it too late to set up a Shopify store?

Starting a Shopify or any e-commerce website now is excellent timing. People know they need it, but they are very slow to implement it. Traditional businesses are slowly being outcompeted by more flexible and cheaper e-commerce websites.

This can be seen by the huge spike in online sales during Covid. Which showed that when needed, people would buy online and buy in massive amounts. Once people adopt it, much like the internet became widespread, it would be hard to go back.

So, now is the best time to sell things online, and it has never been easier. You can also buy and sell items online, using online marketplaces such as Amazon, Sheepbuy, and Ebay.

In fact, the website you are on now is an online marketplace, where they offer a free account where you can sell your items for Free. The cool thing about our marketplace is that we do not charge a selling commission like other marketplaces. All transactions are between the buyer and the seller via Paypal. If you are interested in listing your items, click here and start saving.

Conclusion

Shopify is not too saturated. You can tell because only about 5% of retail sales are made in online stores. Which means there is a huge room for growth. Also, compared to other e-commerce platforms, Shopify has about three times less the amount of stores as Woocommerce. So, Shopify doesn’t make up a large percentage of all online e-commerce stores at all. Now is a great time to start selling online. You can definitely try Shopify but beware of the fees incurred. You can also use our marketplace to sell your items without commissions and for free.