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While I was learning how to start my business from the ground up, one of the many ways I learned to make use of the internet is e-commerce businesses.
These are businesses that put up a virtual shop using a website to sell goods, services, or both.
My suggestion for you if you want to start investing in this form of business is to think about which platform to host it.
After giving you a brief background of each platform, I will then compare them against nine criteria: expertise, experience, scalability, SEO-friendliness, mobile-friendliness, security, support, plans, and pricing.
Before that, do watch this video to refresh yourself as to how to start your online business:
Shopify at a glance
Etsy was a software platform that the company’s founder Tobi Lütke made for his first store in 2004, he eventually released it two years later that it would be a more valuable product to offer in the market.
As of now, the Canadian company has more than 5,000 employees working around the clock to support more than a million merchant partners in around 175 countries. This workforce can bring in $155 billion in total sales too.
Etsy at a glance
Meanwhile, this American-based company was founded by Rob Kalin, Haim Schoppik, and Chris Maguire in 2005. The trio thought about providing businesses access to a global internet marketplace where they can sell their wares.
Since that time, they were able to support at least 2.7 million active sellers and create a list of around 66 million items for its 46 million active buyers to purchase.
They were able to become one of the largest internet marketplaces to date as they focused on three things as a service provider. These items include being best-in-class search and discovery, human connections, trusted brand, and collection of unique items.
Reasons why you should build an e-commerce business
Before I compare both e-commerce platforms, I would like to share my ideas as to why you should make this type of business from now until the unforeseeable future.
If you must know, starting an e-commerce business does not require huge set up costs.. As a result, neither will you need a substantial starting capital nor will your business take a lot of time to build.
With that in mind, the following are valid reasons as to why you should do your business online:
The first advantage of opening an e-commerce business is the amount of control you can wield to keep improving every aspect of your venture. From how you want to advertise to taking orders, you would learn more about these aspects in maintaining and nurturing your investment.
Aside from that, you can also control two things when opening up your own online business this way. First, you can dictate how much time you spend per day on your business. The other thing has something to do with the amount of work you want to do within that time.
Work with your passion
As I have explained that opening an online business is all up to you, this means you can choose to sell a product or service that you are passionate about.
For example, I expanded my own business so that I can post my songs while writing blogs about strategies I’ve developed to get more visitors to my website. From there, I have written various topics from what your mindset should be as an entrepreneur to why you should think about insurance if you’re in danger of forest fires.
Stabilize your position money-wise
Business Know-How did a survey last year, and they found out that of all their respondents, 66% of them were able to make at least $100,000 annually. If I learned about this last year and I hadn’t opened a business yet, I would start making one as soon as possible.
Aside from that, setting up an online business at home can help you gain tax deductions for several things such as your mortgage payment and furniture. This can be arranged by talking with an IRS agent. As a result, this will help you have extra money for emergencies.
Shopify vs. Etsy
Now that we know why you should start an online business alongside the backgrounds of Shopify and Etsy, let us dive into what makes each platform stand out.
Expertise and experience
What Shopify is known for is that it offers itself as an all-in-one e-commerce platform for those who want to start their online selling business. For a paid monthly subscription, you are given access to a website, blog, and shop.
If your business is gaining traction and you have a stable customer base, opening a Shopify account and subscription is a great next step. This e-commerce platform can help you explore more of your product lines and increase your customer base while adjusting to these changes.
Meanwhile, Etsy is known for an online marketplace that is provided by those who sign up onto their platform to sell homemade, vintage, and craft products. If you want to start a business within those three categories towards a broad audience, you can pay them a monthly fee.
If you invest in any of their subscriptions, Shopify can help you get a domain name that includes a website, blog, and shop. If you want to attract your business through your website and blog, you can do so as you can choose from over 70 templates or make your own in their module.
Speaking of shopping, Shopify gives you the freedom to make a customized order form and let them be able to pay through credit or debit card. Aside from that, you can use their Shopify Payments service and gain access to more than a hundred third-party processors too.
If you are planning to open a physical store in the future after opening your business with Shopify, you can make use of Shopify POS to keep track of all payments, especially during face-to-face transactions.
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Shopify can also allow you to integrate various applications to make your website, blog, or shop more interactive. This benefit also includes connecting your business’ social media pages too.
On Etsy, once you sign in as a seller on their platform, you can add items that you are selling to the millions of items present in their marketplace. You get your domain like in Shopify too.
However, if you want to sell on Etsy with your blog and website, you need to pay more. It also has support to manage discounts and abandoned carts. Unlike Shopify, however, you can only make small changes like featuring products and changing logos.
Aside from that, if you paid more for your Etsy Pattern subscription, you can only choose among ten more templates for your website compared to Shopify’s over 70 templates right off the bat.
Under integrations, you can connect your social media pages and link with other third-party payment applications. However, Etsy Patterns only offers you a limited amount compared to Shopify.
You can also integrate your Etsy store with their in-house payment service. Etsy Payments lets customers pay through credit, debit, PayPal, gift cards, bank transfers, Apple Pay, and Google Pay.
As I have mentioned in the previous section, you can fully customize what you put on your website, blog, and shop when you sign up for a Shopify seller account. With that in mind, you can modify content as much as you can to get a higher SEO rank in search results.
If you want to offer your online business in different languages, Shopify allows you to do so. You can access this through their in-built editor while you are logged into their website. Doing this will help increase your customer reach across the internet.
On Etsy, you can at least change the content of your shop, product listings, and blog. If an international customer visits your page in their country, the e-commerce site will automatically translate your page’s content for them to understand.
The auto-translate is good, but you may have to work around this to create unique content for your English and non-English speaking customers. This strategy will also help you rank high in search results at the same time.
Both e-commerce platforms offer integrations with other applications and tags in order to increase your Shopify or Etsy store in search results.
As smartphone use is increasing year after year, it is best to optimize your e-commerce shop to be as accessible on mobile as it is on PC. With that in mind, let us explore how Shopify and Etsy handle customers browsing your store on mobile.
For Shopify, you are given control of how you can customize your website. With that, you can make use of their catalog of themes to apply to your website, blog, and shop right away. They are all mobile responsive, which makes it accessible on any mobile device.
Since you are restricted from using Etsy’s base theme once you sign up for them as a seller, anyone can access your store using a mobile device. Even if you are restricted, Etsy’s mobile-ready service helps you gain access to customers on mobile.
For their Pattern by Etsy service, Etsy’s website provider, all of the themes that can be accessed through their editor are mobile-friendly. This service is an advantage even if you are limited to how much you can make your website unique on their platform.
Both e-commerce platforms offer protection for sellers like you and your future customers at the same time.
First, both platforms save information such as product information and payment details in their respective cloud-based platforms. This means that you can retrieve and store data on either platform with ease.
Getting a Shopify account as a merchant will also give you access to a free 128-bit shared SSL certificate. This feature allows your website, shop, and blog to be accessed securely by you and your customers.
Etsy, on the other hand, ensures that all transactions are done on their SSL-encrypted platform. Aside from that, they have particular contingencies such as security specialists and fraud detection systems running around the clock.
Whether you want to start a Shopify account or not, you can browse through their Help Pages to learn more about the platform. Aside from that, you can take lessons from E-Commerce University. It contains articles, how-to-guides, and other resources to use their service wisely.
Anytime during your subscription, you can also contact their support team if any other issue pops-up, such as canceling your subscription or settling payments in a transaction. They also have a 24/7 live chat feature that can help you resolve any problem you encountered during the day.
Plans and pricing
In this section, I will be discussing all the available plans that you can buy if you want to sell on Shopify and Etsy.
Before subscribing to any of Shopify’s premiums, you can opt to try out their system for 90 days. This will help you gauge whether you can navigate around its modules.
For $29 per month, you can get the following:
- Your own Shopify website
- Your own Shopify blog
- Your own Shopify store
- Post as many products for sale on your account
- Share any of your products on Shopify through other marketplaces and social media sites
- Manual order creation
- Manage discount codes
- Recover abandoned carts
- Create up to two staff accounts who can access this account
- Get up to 64% shipping discount for every customer order
- Create shipping labels
- Online credit card purchases get a rate of 2.9% plus 30 cents
- In-person transactions are charged 2.7%
- Purchases done using any other provider is charged 2%
- Access to Shopify POS
- Integrate with third-party POS applications
This plan includes all the benefits of the basic Shopify plan. In addition to that, you can get the following for $79 a month:
- View reports such as the number of daily transactions to the number of regular visitors
- Add up to 5 staff accounts
- Your shipping discount is set up to 72% from 64%
- Avail of USPS Priority Mail Cubic prices
- Reduced online credit card purchase cost to 2.6%
- Reduced in-person purchases cost to 2.5%
- Reduced cost for paying using other providers to 1%
- Manage shifts for Shopify POS
- Create multiple POS pins
- Add up to 5 store locations
- Gain access to hardware support
This is the plan with the most benefits Shopify can provide to its sellers. It costs $299 monthly, and it includes all the benefits the other two paid plans have to offer.
Aside from those, it includes the following benefits unique to this plan:
- Compare shipping prices through third-party applications
- Add up to 15 staff accounts
- Shipping discounts can reach up to 74%
- Any online credit card purchase will be charged a rate of 2.4% per transaction
- Any other payment methods will be charged a rate of 0.5%
- Add up to 8 store locations
This plan is available to potential businesses that are either medium-sized or large-sized that deal with multiple transactions. Unlike the first three paid plans, availing of this plan would depend on your business performance and information.
If you wish to avail of this account, it will come with the following:
- Access to Shopify applications suited for high-growth merchants selling for businesses
- Create a customized checkout system
- Improved API integration
- Membership to their Merchant Success Program
- Partner with one of Shopify’s Launch Engineers, an assistant to your online business who can suggest integrations with applications, designers, and developers
- Add up to any number of staff accounts
- Add up to nine expansion stores
- Gain access to beta programs to learn more about your customers to manage your future business plans
- Membership to Shopify’s Plus Partner Program
- Educate yourself at the Shopify Plus Academy
- Membership to Shopify’s Facebook Group called Shopify Plus Community
- Gain access to up to 100 themes
- Keep seasonal versions of your current theme
- Test any number of changes to your theme
- Manage which staff account can export reports or make use of integrated applications
- Create a wholesale store with its channel and protect it with a password
If you want to partner with Shopify but you think that you can’t pay for any of the previous premiums, you can opt to pay $9 a month to gain access to the following:
- Create a Shopify store
- Integrate your Facebook business page to Shopify
- Get Messenger chat support to obtain a channel to keep track of customer orders
- Add a “Buy Button” to link your shop to any other website
- Gain access to the Shopify POS app for credit card transactions
- Manage your customer invoices
With Shopify Lite, you can still ask for support from one of their representatives if you need help with your orders, products, and inventory.
Meanwhile, Etsy allows you to create an account as a seller for free on their website. What they will charge you for is listings, advertising, transactions, and payment processing.
Every time you list an item on their platform, the e-commerce website charges you 0.20 USD. This price remains whether or not someone bought it through your store. This is also charged to you if you bring back an old listing, sell different variants of it, or transact privately to a buyer.
If you signed up for their Pattern by Etsy service, do take note that you will be charged for offsite ads and Etsy Ads depending on how you are as a seller. Offsite ads are charged between 12% to 15% depending on how much you have earned annually.
When a customer buys an item from your listing, Etsy gets 5% from its total item cost in your local currency. To ship it, they also get 5% of the total shipping charges.
Finally, their payment processing fees are taken from the item’s total sale price, including shipping fees, and its corresponding sales tax. This will only apply if a customer paid through Etsy Payments.
I have shown you that it is possible to start an online business in this article. Aside from that, I have introduced you to two of the most popular e-commerce platforms where you can begin your journey from.
Do take note that each platform has its strengths and weaknesses. Using the right one, depending on your business strategy and growth, will help you go a long way.
Did this article help you plan out your way to a successful online business? Read the following articles to help you with the rest of the way:
- Using SEMRush for your competitor research
- Shopify or Amazon? Which one is right for your business?
- Growth hacking stories you need to know for your business in 2020
Want me to cover another e-commerce platform that has not been reviewed yet? Comment below which one I should write about next.