With Collabs, Shopify is signaling the promise of connecting merchants and creators to each other.
Collabs is the latest in a series of creator tools from Shopify. (Courtesy photo)
With a focus on spurring entrepreneurship, Shopify’s ecommerce infrastructure casts a wide net.
While it is often synonymous with the direct-to-consumer brands of the last decade that put a value on controlling their store and selling through digital means only, Shopify’s tools to set up and run ecommerce stores are used by a variety of businesses. There are small businesses or independent grocers that want to sell online, solo makers who started in their kitchen, dropshippers or musicians selling merch.
As Shopify’s team expands the available tools within its app store alongside an active community of developers, it in turn can specialize particular offerings that will serve these distinct groups. In some cases, there are also opportunities to connect merchants to each other.
With a recent series of releases, the company is signaling an expansion of available tools for creators – shorthand for the people who make digital content and build a direct audience on social platforms.
The latest rollout arrived Tuesday. Shopify Collabs is a new platform that connects creators and merchants. Creators can browse Shopify merchants to partner with, then curate a selection of products from these brands using Linkpop, which is Shopify’s link-in-bio tool. When someone purchases a product using that link, creators also get paid through Collabs.
For creators, who often partner with brands to showcase products as a monetization opportunity, this offers an avenue to easily connect with merchants. Shopify points out that many creators work part-time, so they benefit from tools that can save time and make the process of finding brands easier.
For merchants, Collabs offers an avenue to connect with a group that is succeeding the influencer as a key conduit to reach potential customers. With video-based content only gaining importance on platforms like TikTok, YouTube, and Meta’s properties, creators are becoming more important parts of the chain that leads to a purchase. Meanwhile, customer acquisition is only growing more challenging for brands as costs rise, privacy challenges limit attribution capabilities that previously drove big conversions on platforms like Facebook, and more venues for marketing emerge.
"For Shopify merchants, Collabs is a new way to find potential customers at a time when it's never been more difficult or expensive," said Amir Kabbara, director of product at Shopify, in a statement. "By giving merchants the ability to discover and partner with creators that align with their brand, they can tap into the power of community-driven commerce to reach consumers in new and meaningful ways."
Collabs is just the latest tool for creators that was released within Shopify. In recent months, the Ottawa, Canada-based company has also:
Shopify’s moves so far illustrate the unique place at which creators sit. Harnessing content, creators are bringing together audiences and demonstrating expertise. This combination of community and value in turn provides an opportunity to showcase and curate products that are for a community. Those products can come from brands. In time, they may even be a creator’s own. All of this opportunity leaves room for them to build their own brands and start their own companies that are an important part of selling consumer products.
Creators sit at the intersection of media, community building, influencer marketing, commerce and entrepreneurship.
Within Shopify itself, the creator similarly has multiple roles. They are the conduit for brands to reach an audience, which necessitates the connections that Collabs provide. But at the same time, Shopify is now allowing creators to set up their own stores. In many ways, they are among the entrepreneurs that Shopify is seeking to serve, just as they are serving the entrepreneurs. Not to mention, they’ve already done the work of building a community that’s engaged around a specific interest, and are now bringing them into the store. Talk about direct.
This has important implications when considering Shopify’s primary goal, which is galvanizing entrepreneurship. The company accomplishes this aim at the intersections of its communities, as well as within the communities themselves.
Perhaps the most prominent example comes through its app store. Using its software, entrepreneurs can open stores to grow businesses through digital commerce. But building that software itself spurs entrepreneurship. The Shopify app store’s open model allows developers from beyond the company’s own team to create apps that can in turn spur businesses. It is providing the infrastructure for not just consumer product startups, but also software startups. Having invested and acquired some of those apps gives Shopify itself an equally unique role in the middle of this, but that’s a topic for another piece. The point is that developers are both becoming entrepreneurs and serving entrepreneurs in Shopify’s community.
With creators, Shopify has a group that is even more intertwined into its core community of consumer brands, given that creators are active participants in the process of selling physical products. The fact that they are setting up stores and connecting them to social channels indicates represents a recognition by Shopify that creators offer their own form of retail.
In today’s announcement, Kabbara indicated that Collabs in the future “will be fully integrated with Shopify, giving creators access to more parts of our platform and accelerating their journey as entrepreneurs." This all leads to the question of where Shopify is heading as it offers more and more creator tools.
It clearly sees potential to support and galvanize this group of entrepreneurs. The question is how they can easily connect them to opportunity. Collabs offers the strongest example yet that those connections can happen within the Shopify ecosystem.
Where could this go next? One avenue that you might consider would be building tools for the other parts of a creator’s work beyond commerce. It could offer creator-specific stores, with tools not only to sell but also to share (shoppable) content and foster social touchpoints with their audiences. They could add ways to discover other creators, and their stores, as well. Go too far down this road, however, and Shopify would essentially be building some cross between a social platform and a consumer marketplace. If history is any guide, the company has little appetite for either of these directions. While its stores are all built using Shopify tools, they remain independent websites. After getting their stores set up and products at the ready, merchants must go out (often to social platforms) and develop ways to reach audiences there (increasingly through creators), while also figuring out how to get products to their customers via fulfillment and delivery methods. This has always made it distinct from Amazon, which offers a common site where sellers display their own goods alongside others. Amazon sellers give up layers of independence and the control over their stores that comes with them in exchange for Amazon doing the work of attracting the audience and access to its fulfillment network.
While Shopify is going down the road of building out fulfillment and offering advertising tools to merchants in the form of the recently-released Audiences, it has given no signals that it is set to build a marketplace of its own for merchants, or offer ways for merchants to promote themselves in each others’ stores through advertising.
Likewise, the creator tools it has offered to date are designed primarily to integrate with the other platforms where creators gather and meet their audiences. Shopify is currently still the endpoint.
Collabs indicates that Shopify is interested in connecting creators to the entrepreneurs who use its tools. It is not, however, the type of marketplace where creators sell their goods to consumers. Platforms like TikTok and Instagram have their own creator marketplaces that similarly seek to surface partnerships.
With this in mind, it seems more likely that Shopify seems to be working toward an ecosystem. Similar to the app store, they are offering a growing number of tools that creators can access in order to improve commerce capabilities. At the same time, it’s a place for them to do business with each other, with that business still happening on top of Shopify’s ecosystem. Given where creators sit, however, this may ultimately exist as a separate ecosystem from one that exists for developers, with Collabs as a centerpiece. The potential to work with brands can further make Shopify a foundational part of the equation for creator commerce, no matter the primary platform where they share content.
Shopify shared data showing that the creator economy is worth $100 billion. With many creators still part-time, it sees room to bring growth through the still-nascent path of commerce, with a stated goal of providing economic independence to creators.
Still, how big a role this ecosystem ends up playing for Shopify is dependent in part on whether the creator economy continues to grow. Today, more than 50 million people globally count themselves among this group. But its rise has been heavily tied to the short-form video format of TikTok that other platforms are now adopting. Something else could come along with technology advances. After all, the creator model of the early 2020s is subsuming and replacing the influencer model of the 2010s.
It could also depend on where Shopify wants to focus at a time when it had to lay off 10% of its staff as a result of a misplaced bet that the ecommerce growth trajectory of the early pandemic would continue. Its leaders may not want to make a big bet again at a time when it is less certain where the market is heading. Besides, Shopify is also building out a fulfillment network, launching B2B ecommerce tools, and shipping a host of other products designed to provide updates for the merchant and developer communities.
Nevertheless, Shopify has clearly recognized the potential power of creators to serve as their own group of entrepreneurs, and to serve those in its merchant community. If Shopify continues to provide infrastructure to bring the two groups together, it seems likely that they’ll only continue to unlock new opportunities at the intersection of content and commerce. Both groups are working to build brands and connect with audiences. Give them more tools, and they could develop new ways to do so. They may even create their own.
After all, the beauty of an ecosystem is that it is self-renewing.
Can Shop Cash entice more users to use the app for browsing and buying?
Shopify is launching a new rewards program for items purchased through its checkout system.
Shop Cash will provide the opportunity for consumers to earn 1% back on purchases made through Shop Pay.
The feature includes a direct tie-in with the Shop app. Users can check their balance through the app, and the rewards are redeemable for future purchases through Shop, as well.
“This is a coming of age moment for Shop. It’s become an incredible app that allows shoppers to discover great brands, check out with one tap, and track orders in real time,” said Harley Finkelstein, president of Shopify, in a statement. “Shop Cash represents the next evolution of Shop, connecting independent brands to more shoppers, and rewarding those shoppers for being loyal fans.”
The launch falls on Shopify’s 17th birthday, so the ecommerce software company is giving away Shop Cash to celebrate. For Shop Day, Shopify partnered with dozens of merchants, including Trixie Cosmetics, MrBeast and Monday Swimwear. They’ll share custom links across channels that offer cash to spend on the Shop app. In all, Shopify will give away more than $1,000,000. Brands will also be running exclusive Shop Cash offers throughout the day.
The rewards program marks a new way that Shopify is aiming to transform Shop into more of a shopping app where users can discover new items, extending beyond its initial use for post-purchase order tracking and management at launch in 2020.
Shopify has been making moves over the last year to provide more opportunities to browse and buy recommended products, as well as giving brands more tools to showcase storefronts and tell their stories. With Shop Pay, the app offers one-click checkout. There are signs that it is all inspiring users to seek out the app. Shopify said 35% of the orders on the Shop app are repeat purchases.
With more brands joining the app and infrastructure for the shopper experience and checkout in place, rewards can help make the app stickier for consumers. The opportunity to earn cash, redeem it and even check a rewards balance are all reasons to keep returning to the app, and make it a destination to shop.
Shopify has long been known as the infrastructure layer of commerce, as it provided the tools for brands to run and manage an online store under their own name. With the Shop app, it is aiming to make Shopify itself a destination for shopping. It remains a nascent effort, even as more brands have taken advantage of the new features to enhance storefronts.
This comes as marketplaces continue to rise across ecommerce, and giants like Amazon and Walmart experiment with tools that do more to boost discovery of new products.
Social media has long been the engine of discovery in ecommerce, especially in the direct-to-consumer realm that Shopify has owned. Users found products on Facebook or Instagram, then finished checkout on a brand's phase. With the push toward privacy making performance marketing more difficult and customer acquisition costs rising, the ecommerce platforms are attempting to take that power into their own hands. With advertising placed close to the point of sale through retail media and the ability to check out on the same page where a user sees a product, marketplaces and Shop are realizing new opportunities to attract, convert and deliver for users within one app. For Shop, the trick is to attract more shoppers to the app. Rewards like Shop Cash are a carrot to do just that.
