During Shopify’s Q4 earnings call on Wednesday, executives expressed optimism about Amazon’s Buy with Prime feature, which allows sellers to offer Prime benefits on websites outside of Amazon. Those include faster shipping along with free delivery and returns. The transaction is however done using payment and shipping info that is stored on the buyer’s Amazon account.
However, as BusinessInsider reported, many analysts have equated ‘Buy with Prime’ to a “Trojan horse” as this could allow Amazon to capture revenue that Shopify would earn when customers make a purchase from their merchants. Currently, Shopify’s platform does not support Buy with Prime, and merchants that try to install it receive a pop-up warning that it violates the company’s terms of service and could leave their store vulnerable to fraud. The Shopify app store too does not offer Buy with Prime at the moment.
“We think any company that’s going to make the infrastructure available to merchants to sell more is a great thing. We like it,” said Shopify president Harley Finkelstein. “But it has to be done in a way — that we think is important — for merchants to have a relationship with their end consumer.”
Shopify meanwhile has stated it is in talks with Amazon about integrating Buy with Prime onto its platform though the details of it remain undisclosed. The company though said it is part of a continuous process as they regularly engage with other companies and platforms with the aim of offering a better shopping experience for their merchants.
Several Shopify merchants prefer not to sell their wares via Amazon as they believe this will lead to the retail giant gaining control over customer data.
“A merchant chooses Shopify because they don’t want to sell through Amazon because they want to own the relationship. They don’t want Amazon to own the relationship,” D.A. Davidson analyst Gil Luria told Insider. “Why would a merchant that chose to go with a Shopify storefront so they can own the customer, bring Amazon into the equation?”
While Shopify wants to add new features and options so that merchants are able to make the most of the latest technological advancements, revenue sharing arrangement happens to be the biggest hindrance towards that becoming a reality. Since Shopify generates most of its revenue from transaction fees, it does not want to allow its rival to take over checkout.
Experts however feel Shopify might have some leverage when negotiating with Amazon and is also highly likely that Buy with Prime will be incorporated into the Shopify platform. What remains to be seen though is how the two companies split the revenues between them.
With a keen interest in tech, I make it a point to keep myself updated on the latest developments in technology and gadgets. That includes smartphones or tablet devices but stretches to even AI and self-driven automobiles, the latter being my latest fad. Besides writing, I like watching videos, reading, listening to music, or experimenting with different recipes. The motion picture is another aspect that interests me a lot, and I'll likely make a film sometime in the future.
