pening the E-Commerce Floodgates
Shopify has faced criticism that it’s made it easier for sellers of
counterfeits and other dubious merchandise to reach a wider audience
along with legitimate brands. Amazon has faced similar questions about
its marketplace, where journalists and analysts have found widespread
listings for counterfeit or faulty products.
Joseph said Allbirds has found counterfeits on Shopify, although the
seller’s site was taken down after the company complained. Padelford
said Shopify doesn’t have a team that actively polices the platform,
adding that “when we get notified, we take this very seriously.”
Shopify has also faced scrutiny for hosting websites that sell cheap,
often shoddy products that, thanks to the platform’s easy-to-use tools,
are difficult to distinguish from more-legitimate brands. Overland
Sheepskin, an leather and outerwear company based in Iowa, told The
Washington Post that it identified over 700 websites using its imagery
and selling knockoff products, with 90 percent hosted by Shopify.
Drop-shipping, a tactic that allows sellers to list products online
without actually stocking them, has also turned into a big business,
thanks in part to Shopify. The practice is a legitimate way to get
products cheaply from factories and wholesalers to customers. However,
it can also be abused to flood the market with cheap, low-quality
fashion. One Manchester-based seller boasted about making $700,000 last
year by uploading cheap Chinese fashion from AliExpress he found on the
internet and selling them on his Shopify page.
A Cookie-Cutter Solution
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Shopify’s plug-and-play tools are well-suited for e-commerce
newcomers, but many brands say they reach a point where they outgrow the
platform’s offerings.
“You can look at a site and tell it’s Shopify,” Rogers said.
Sara Davis, e-commerce manager for The Sports Edit, a British
sportswear retailer, said she believes Shopify’s only available checkout
feature causes some customers to abandon their online orders before
completing the purchase.
“You can’t customise the Shopify checkout journey, which takes you to
an entirely different page and does not keep you on our site,” said
Davis. “Farfetch or Net-a-Porter keep their shoppers on the site
throughout, but with Shopify, once you go to check-out, you’re on that
journey, which leads to a lot of bounce-offs.”
You can’t just call someone at Shopify and have a conversation.
Some Shopify merchants have also been unhappy with the company’s
customer service as it's grown. Eva Dayton, the founder of luxury
consignment store Consignment Brooklyn, said she was disappointed by
Shopify’s response to her complaints about multiple fraudulent
incidents.
“You can’t just call someone at Shopify and have a conversation,”
Dayton. “You need to chat with a robot and then schedule a call, which
doesn’t feel right if there’s an emergency.”
Shopify said it recently instituted a callback system for customer serv
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options continue to be handled 24/7 by live agents."
A Walled Garden
Retailers’ critiques haven’t slowed Shopify’s growth. And the company has ambitions to further cement its role as the platform that runs much of the online fashion economy.
Late last year, it began piloting a fulfilment service, for which it has partnered with seven warehouses across the US to handle and ship orders. It also launched Shopify Capital, a loan financing service for online sellers.
Some analysts are concerned about the platform’s growing influence. They worry brands could end up relying on Shopify too much, much as Facebook and Google have come to dominate online advertising.
Gallino, from Wharton, predicts there will be a consolidation in e-commerce services, “similar to how there are a few video conferencing services but everyone uses Zoom.” That would give Shopify enough market clout to raise prices or exert more control over how brands operate.
In response, Shopify said its "mission is to make commerce better for everyone. Our efforts are focused on reducing the barriers to starting, managing, and growing a business."
Dayton, the owner of Brooklyn Consignment, said she was alarmed when Shopify told her she’d have to upgrade her subscription to receive better fraud protection (Shopify said it has a "built-in fraud analysis with all credit card-transacted orders" and that it has several free fraud apps that are available for merchants).
The only way to work with these platforms is to maintain some sort of tech capability.
Szasz advises brands to use bits of Shopify’s services — but not rely on the company to run their entire e-commerce operation.
“The only way to work with these platforms is to maintain some sort of tech capability,” she said. “Don’t go blindly to Shopify to do turnkey solutions. Maintain some elements so that if you do decide to move elsewhere or do it yourself, you won’t feel attached.”
Joseph, of Allbirds, said the brand is happy with Shopify but that the option to move off the platform is always on the table.
“Will we grow out of Shopify? It’s too early to tell,” he said. “If we can simplify our ecosystem in the future, we might go out on our own, but we’re happy to work with them because they are still innovating.”
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