If you’re setting up an online store or upgrading your existing one, choosing the right eCommerce platform can be a daunting task as technology changes in the blink of an eye.
The consequences of your decision will be evident as your business grows and you will be either spending your time and energy in handling the tech stuff or focusing on your core business of selling and growing your customer base!
The leaders: Magento and Shopify
Online customers today expect a superior experience, more convenience and lightening speeds when shopping online. Shopify and Magento are two leading platforms that can help you live up to those expectations.
While Magento has established itself as the number one platform for online stores, Shopify with its full-package hosted platform approach has grown in popularity over the last few years.
Part 1 of this post will help you understand the basic differences in the tech part, it will be followed by a feature comparison in Part 2.
Decoding PaaS vs SaaS
Magento is a free & opensource PaaS (platform as a service) – which gives you the tools to build your functionalities, instead of providing out-of-box solutions. Using Magento, you can really go wild with customizing your store, but you will need to buy the software license, find a hosting provider, and then install and configuring your eCommerce back-end yourself. As this is freeware, you will either need to have good programming skills or hire a full-time developer to do it.
Shopify on the other hand is a SaaS platform (software as a service). A SaaS takes away many of your responsibilities; most of the functionality needed by a web store is already built-in and is ready to go from any browser on any device. It’s a more DIY and user-friendly solution, and they have a support team always ready to help you when you get stuck.
Set up & customization
Magento allows the flexibility of unlimited customization, as you get access to the source code of your CMS (content management system) when setting up your site. Obviously this freedom to customize means it may take longer to launch, as you need to purchase your hosting, set up and configure the server, and write code to set-up your store from scratch. So if you’re not an IT wiz and you want a quick and easy set-up, Magento is not the platform for you.
In Shopify, the entire functionality of a basic store and the infrastructure required for it is bundled together as a package, and you just need to install your chosen theme and get going. The wizard mode in Shopify makes setting up an easy process. If you want to have some customization you can receive a developers kit and access the codes for this platform too.
Integration of your online store with other systems like payment gateways, inventory management and other multichannel sales platforms is a sure-fire way of scaling up your online business. Data flows via APIs (Application Program Interfaces) makes the order processing smooth, and helps in ease of managing various aspects of your business.
Shopify and Magento both have powerful APIs, but since Shopify is giving you an out-of-the-box solution the integration is much simpler due to the limited options available. The open-source foundation of Magento’s software means you’re free to code your store in a variety of ways and so is every other merchant. More variability between stores makes integration more complicated and costly in terms of time and money.
Ongoing maintenance and upkeep
If you’re a merchant on Magento, maintenance is your responsibility. While it is certainly better to have complete control, especially in decisions around resource sharing bandwidth and traffic management, many merchants feel overwhelmed when pesky IT issues emerge.
The hosted nature of Shopify however means assistance is always available and their tech team is always monitoring the infrastructure for security, performance, traffic peaks and timely software upgrades. You’ve basically put your store in their hands and they take responsibility for any problems that might occur.
The issue of safety and data security is critical for online merchants and for good reason. Your customers will be sharing personal data on your store and your livelihood is at risk of hacking and other cybersecurity threats. You also want to be sure your business is meeting data privacy policies such as CCPA and GDPR. Shopify provides most of the basic compliances required for running an eCommerce store; while Magento requires you to be more involved in the data security initiatives for your website, which makes sense considering they are not hosting your site.
Let’s Talk Money.
Shopify needs you to subscribe to a particular plan with a monthly subscription fee. This includes costs of web hosting and all other features such as security, maintenance and support. The plans are:
- Shopify Lite Plan at $9
- Basic Shopify Plan at $29
- Shopify Plan at $79
- Advanced Shopify Plan at $299
(full descriptions of what each plan offers can be found on Shopify website)
Magento on the other hand is open source so you’re looking at additional costs for hosting, licensing, security and maintenance, among others. This can end up being more expensive than using any of Shopify’s plans as it is possible for these costs to reach over Rupees One lakh a year.
When it comes to transaction fees you won’t be charged with any if you’re using Shopify and don’t take up a third-party payment gateway. The fees for such gateways range from 2% for the Shopify Lite Plan and basic Shopify plan, to 1% for the Shopify Plan, to 0.5% for the Advanced Shopify Plan. Magento Open Source boasts zero transaction fees, but your gateway provider will charge you depending on which gateway you’re using.
As a Direct-to-consumer (DTC) brand, Shopify has evolved in leaps and bounds compared to other eCommerce platforms. They aim to give their users the most efficient and easy-to-use interface and keep upgrading to integrate the app ecosystem around their core eCommerce engine with features like headless commerce and social commerce,
Magento being more of a B2B company, enables enterprise-level functionality on their eCommerce platform with features like customizable product catalogs, account terms, and buyer approval processes.
But don’t make your decision just yet, read more of our comparison of Shopify vs Magento in Part 2 with a detailed feature-by-feature evaluation.