Why Shopify Plus is crucial to Shopify
According to Shopify, around 14,000 merchants were on Shopify Plus at the end of 2021. This makes for a very small share of Shopify's overall installed base of 3 million merchants (June 2022). A more conservative estimate by PipeCandy however places the active number of Plus users at around 10,200 which accounted for the 29% share of Shopify's overall MRR.
Despite a much smaller merchant market share and a lower average customer size, Shopify Plus nevertheless has an impressive list of brands including Nike, New York Times, Xbox, Lulu, Vogue, Allbirds, Decathlon, and many others. While Magento-1’s 'end-of-life' helped Shopify Plus to acquire a lot of mid-market B2C brands that were looking to re-platform, growth in new merchant onboarding has been at a slow but steady pace until the third quarter of 2021.
Shopify’s Plus: Market Landscape and Mid-market Concentration
More than 73% of the active merchant base consists of domains with a website traffic rank greater than one million indicating little economic activity (Chart 3).
Among the 'Top 500' by website traffic rank, at least 30 domains belong to musicians and artists. These include Lady Gaga, Katy Perry, Ariana Grande, Eminem, etc selling merchandise, records3, and other accessories.
The Top 500 ranks are also dominated by news and media publishers, artists, video game publishers, entertainment businesses as well as nonprofits.
These include news and publishing houses like New York Times, New Yorker, The Economist, and even BuzzFeed.
A closer look at the domains of news and publishing outlets as well as nonprofits reveals that most of them are merchandise- or subscription-offering portals. For example, The Economist hosts its eCommerce store on Shopify Plus, offering back issues, diaries, and personalized printing on books, t-shirts, mugs, and bags. It has also provided a virtual learning center Learning.ly over Shopify Plus. The New York Times sells branded goods, archival photography, books, and personalized front page reprints from its commercial portal.