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Do I understand it correctly? Basically, a developer would create new functionalities for the Shopify platform and Shopify will take 10/20% commission depending

by pw6hv 6y ago

Do I understand it correctly? Basically, a developer would create new functionalities for the Shopify platform and Shopify will take 10/20% commission depending on the store plan from the developer? I personally would suggest to start a business creating WooCommerce websites. At least you'll be owning the whole profit and would not depend from the whishes and decisions of a wannabe BigCorp. As an additional plus you help spreading open source software.

zhobbs 6y ago
User acquisition is very hard. If you can outsource that to a marketplace the commission is probably worth it, especially if your goal is to be a very lean micro-SaaS.
jariel 6y ago
It's deeply integrated into Shopify platform, it's easily worth the 20% bump if only for the exposure, cred, billing etc..
heipei 6y ago
The true problem I see with these kind of integrations is that a company like Shopify can very easily figure out which third-party extensions are turning around the most revenue and then re-build those in house, only better since they have direct access to the folks building the platform.
- valuearb 6y ago
  Being Sherlocked is a problem you should always consider closely for any App Store product. The benefit of App Stores is getting a access to a mass number of qualified customers anxious to add compelling features to the platform they bought, be it a web store front or iPhone. The negative is the platform has to always keep moving ahead, and sometimes your app is right in its path. We used to call it picking up nickles in front of the SteamRoller back in my Photoshop Plug-ins days. Was very frustrating, but still very lucrative. I have often talked about giving a demo of my next brilliant plugin to the Photoshop team lead and product manager just before the release of Photoshop 3. Three weeks later Photoshop3 was released with their version of my plugin in it.
- pixelbash 6y ago
  Shopify doesn't seem to do this, and actually it's a bit of a problem because some of the apps have the craziest workaround for gaps in the backend. Can't have multiple discounts in the cart? Splution: create custom discount codes on the fly for absolutely everyone in real-time.
- sdf131 6y ago
  This would be pretty short-sighted. Shopify benefits from the app store ecosystem (and can generate revenue from it) while allowing developers to invest in the platform in exchange for building their credibility as Shopify partners & developers (which generate more Shopify business for them) Stealing the good ideas and adding them to the core platform would generate more money short term but would destroy the app store
valuearb 6y ago
This is a silly and doomed to failure mindset for an aspiring entrepreneur. The question should be, how large is my addressable market and how much gross profit can I generate to cover my overhead. Shopify Merchants are selling roughly $80B a year, at least 5x WooCommerce merchants. Paying Shopify 20% means you net at least three times higher monthly revenues over paying WooCommerce zero commission. Apple charges devs 30%, but in return you get access to the worlds highest volume App Store paying developers $35B a year. You can also make iOS apps using an enterprise certificate, and distribute to tens of thousands with zero commission, but no one will ever find you on the store search, or give you public App Store ratings, you’ll never appear in a top category list or get featured by Apple, and any potential customers you reach will be leery of using your custom payments or subscription system, leading to lower paid conversions.
- claudiulodro 6y ago
  > Shopify Merchants are selling roughly $80B a year, at least 5x WooCommerce merchants. Paying Shopify 20% means you net at least three times higher monthly revenues over paying WooCommerce zero commission. This seems a weird way to calculate potential eCommerce platform plugin profits because (unless you are a payment gateway), the quantity of stores is more important than the volume those stores sell, and WooCommerce is by far the most popular eCommerce platform. For example, Kylie Jenner's Shopify store has approx. $330mm[1] in revenue a year as far as I can tell, but that's only going to translate into one potential plugin purchase. [1] https://www.theedgemarkets.com/article/tech-how-shopify-turned-reality-tv-star-billionaire https://www.theedgemarkets.com/article/tech-how-shopify-turn...
  - Androider 6y ago
    You also don't want to just target the largest number of users, but the largest amount of users who are willing to pay for your plugin. I'm not familiar with the demographics of this particular market, but perhaps it's akin to iOS vs Google? Even though the latter has a hojillion users, app developers make way more money on iOS.
  - valuearb 6y ago
flir 6y ago
Your customers don't want to host WooCommerce sites. Or pay a small software shop to do it for them. They want to SaaS that for a few bucks a month, which is what Shopify gives them.
fiftyacorn 6y ago
You access their customers and shopify handle the billing. Not that bad a deal. Plus you can factor it in to your price
martin_bech 6y ago
Do you want 80% of a big nice pie or 100% of a nasty imaginary non existent pie?
addicted 6y ago
You are paying Shopify for discovery and the usage of certain APIs (such as payment APIs etc). Otherwise it’s possible for someone to integrate your stuff into their store even outside of the Shopify store (by integrating JS snippets for example).

by pw6hv 6y ago

zhobbs 6y ago

User acquisition is very hard. If you can outsource that to a marketplace the commission is probably worth it, especially if your goal is to be a very lean micro-SaaS.

jariel 6y ago

It's deeply integrated into Shopify platform, it's easily worth the 20% bump if only for the exposure, cred, billing etc..

heipei 6y ago

The true problem I see with these kind of integrations is that a company like Shopify can very easily figure out which third-party extensions are turning around the most revenue and then re-build those in house, only better since they have direct access to the folks building the platform.

valuearb 6y ago
Being Sherlocked is a problem you should always consider closely for any App Store product. The benefit of App Stores is getting a access to a mass number of qualified customers anxious to add compelling features to the platform they bought, be it a web store front or iPhone. The negative is the platform has to always keep moving ahead, and sometimes your app is right in its path. We used to call it picking up nickles in front of the SteamRoller back in my Photoshop Plug-ins days. Was very frustrating, but still very lucrative. I have often talked about giving a demo of my next brilliant plugin to the Photoshop team lead and product manager just before the release of Photoshop 3. Three weeks later Photoshop3 was released with their version of my plugin in it.
pixelbash 6y ago
Shopify doesn't seem to do this, and actually it's a bit of a problem because some of the apps have the craziest workaround for gaps in the backend. Can't have multiple discounts in the cart? Splution: create custom discount codes on the fly for absolutely everyone in real-time.
sdf131 6y ago
This would be pretty short-sighted. Shopify benefits from the app store ecosystem (and can generate revenue from it) while allowing developers to invest in the platform in exchange for building their credibility as Shopify partners & developers (which generate more Shopify business for them) Stealing the good ideas and adding them to the core platform would generate more money short term but would destroy the app store

valuearb 6y ago

This is a silly and doomed to failure mindset for an aspiring entrepreneur. The question should be, how large is my addressable market and how much gross profit can I generate to cover my overhead. Shopify Merchants are selling roughly $80B a year, at least 5x WooCommerce merchants. Paying Shopify 20% means you net at least three times higher monthly revenues over paying WooCommerce zero commission. Apple charges devs 30%, but in return you get access to the worlds highest volume App Store paying developers $35B a year. You can also make iOS apps using an enterprise certificate, and distribute to tens of thousands with zero commission, but no one will ever find you on the store search, or give you public App Store ratings, you’ll never appear in a top category list or get featured by Apple, and any potential customers you reach will be leery of using your custom payments or subscription system, leading to lower paid conversions.

claudiulodro 6y ago
> Shopify Merchants are selling roughly $80B a year, at least 5x WooCommerce merchants. Paying Shopify 20% means you net at least three times higher monthly revenues over paying WooCommerce zero commission. This seems a weird way to calculate potential eCommerce platform plugin profits because (unless you are a payment gateway), the quantity of stores is more important than the volume those stores sell, and WooCommerce is by far the most popular eCommerce platform. For example, Kylie Jenner's Shopify store has approx. $330mm[1] in revenue a year as far as I can tell, but that's only going to translate into one potential plugin purchase. [1] https://www.theedgemarkets.com/article/tech-how-shopify-turned-reality-tv-star-billionaire https://www.theedgemarkets.com/article/tech-how-shopify-turn...
- Androider 6y ago
  You also don't want to just target the largest number of users, but the largest amount of users who are willing to pay for your plugin. I'm not familiar with the demographics of this particular market, but perhaps it's akin to iOS vs Google? Even though the latter has a hojillion users, app developers make way more money on iOS.
- valuearb 6y ago

flir 6y ago

Your customers don't want to host WooCommerce sites. Or pay a small software shop to do it for them. They want to SaaS that for a few bucks a month, which is what Shopify gives them.

fiftyacorn 6y ago

You access their customers and shopify handle the billing. Not that bad a deal. Plus you can factor it in to your price

martin_bech 6y ago

Do you want 80% of a big nice pie or 100% of a nasty imaginary non existent pie?

addicted 6y ago

You are paying Shopify for discovery and the usage of certain APIs (such as payment APIs etc). Otherwise it’s possible for someone to integrate your stuff into their store even outside of the Shopify store (by integrating JS snippets for example).