11/20/2020 - CNBC.com
Shopify is a tech company that provides retailers the tools to build a website, add checkout functionality, manage orders, and integrate with other sites like Facebook, Pinterest, and TikTok. Subscription pricing ranges from $29 to $2,000 per month across small retailers to large national brands. More recently, big brands have leveraged Shopify’s platform to establish a significant digital presence.
Due to the COVID pandemic, there has been a large adoption and shift to e-commerce and online spending. It is projected by eMarketer that Black Friday online sales will surge 39% to $10.2B and Cyber Monday online sales will also jump 38% to $12.9B.
Now large national brands like Heinz, Chipotle, and Schwinn are using Shopify’s e-commerce software for the first time to take advantage of this paradigm shift. Heinz was able to set up a store to go direct-to-consumer for their condiments category. Chipotle introduced a virtual farmers’ market to allow farmers who are part of the restaurant company’s supply chain to sell meat, dairy, and other products direct to consumers.
Shopify’s business has been one of the biggest beneficiaries of the stay-at-home result of the pandemic and stock has increased 143% this year and revenue has doubled in third quarter to $767M. Market cap of $118B makes it the most valuable company in Canada. They are certainly the leader in the industry with BigCommerce being a smaller rival also experiencing growth. Although large brands have added recent momentum, it is the small businesses that remain the engine and critical to Shopify’s long term success.
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