In recent times, Shopify has hired two new employees for key positions. Kal Stephen was brought on board in January to lead the lifestyle vertical's enterprise team, having previously worked in a sales leadership role at Salesforce Commerce Cloud for over six years. Holly Dresden also joined Shopify in December to oversee enterprise merchant success, following a stint of six years at Salesforce Commerce Cloud.
Shopify's head of enterprise revenue and head of consumer goods for enterprise both have previous experience working at Salesforce. The Canadian e-commerce platform has recruited more than a dozen account executives from Salesforce since 2021, as well as a number of engineering leaders.
Shopify has brought on new account executives who previously worked at Adobe and SAP, but they are being paid at a lower rate.
Shopify has traditionally focused on serving small and medium-sized companies, but in recent months they have been working to provide software solutions that cater to larger merchants. They have upgraded their Shopify Plus subscription to include more features and have introduced Hydrogen, a custom framework designed for retailers with more complex requirements.
In 2023, Shopify presented Commerce Components at the NRF's Big Show event, a platform that enables retailers to incorporate Shopify's software features into their existing technology systems. Mattel was the first to partner with Shopify for this product, and Everlane later adopted Shop Pay as a standalone tool.
The Shopify company representative stated that they are making significant changes in the world of business-to-business commerce.
The statement highlighted the fact that Shopify is offering various options for businesses to build quickly and effectively across different frameworks. They emphasized that Shopify's products offer high speed, excellent performance, and flexibility, making it a popular choice for enterprise solutions globally.
<h2>Shopify and Salesforce go head-to-head</h2>
The image shows Salesforce CEO Marc Benioff captured by Evan Agostini.
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Shopify is increasingly focusing on competing with Salesforce as it expands into the enterprise market. A recent comparison webpage by Shopify encourages businesses to switch from Salesforce Commerce Cloud to Shopify, mentioning that a study from a prominent consulting firm reported that Shopify's checkout process is 36% faster at converting sales than Salesforce's.
According to the information, Shopify's total cost of ownership is typically 35% better than Salesforce's. Total cost of ownership, referred to as TCO, is commonly used in the marketing of enterprise software to encompass all expenses associated with purchasing and utilizing a particular technology.
Michael Affronti, who holds the role of senior vice president and general manager at Salesforce Commerce Cloud, highlighted in an interview that Shopify's comparison regarding TCO is not equivalent as they are comparing two different things. He mentioned that a majority of Salesforce's clients are international corporations with numerous locations.
During discussions with our large enterprise customers, Affronti mentioned that they are typically more interested in the potential payback in terms of factors like site speed improvement and conversion rates rather than just the total cost of ownership.
Salesforce claims that their customers experienced a 27% increase in return on investment and a 30% rise in employee productivity after using their product, based on their comparison with Shopify.
According to a company representative, Salesforce receives requests from Shopify sellers who are interested in switching their platform because Shopify lacks certain advanced features. For instance, Shopify does not have the capability to enable dynamic pricing based on specific state liquor laws.
Affronti highlighted that Salesforce's performance was excellent, with a 100% uptime record during Cyber Week for the second consecutive year in 2023.
The speaker mentioned that they have focused on building trust, reliability, and security as key aspects of their platform, which is essential for attracting major brands to use their services for international commerce.
Shopify has not had to demonstrate its capabilities in this particular area in the past.
Rick Watson, who is the CEO and creator of RMW Commerce Consulting, mentioned that it is logical for Shopify to target market share from Salesforce. Both platforms operate in the cloud and offer app stores where merchants can access third-party software. They both collect a percentage of sales from merchants, although the pricing strategies may vary.
Salesforce entered the e-commerce industry by acquiring Demandware in 2016 for $2.8 billion.
Watson stated that the type of customer interested in Salesforce is similar to the type of customer interested in Shopify. He believes that Shopify's platform is becoming advanced enough to attract customers who see cloud platforms as suitable for their businesses, similar to the way Demandware did in the past.
However, appealing to larger businesses in the retail sector requires a different strategy, and in this aspect Salesforce has more experience compared to Shopify.
Small businesses starting with Shopify usually either join the platform themselves or collaborate with an agency to begin using it. On the other hand, enterprise-level retailers face a more complex onboarding process, often involving multiple top executives to assess different vendors and associated costs. Implementing new software may also require working with a system integrator such as Accenture or EY to help large retailers compare solutions from various vendors and increase adoption.
This job requires a larger team specifically focused on serving enterprise businesses, which is different from Shopify's usual approach. This team will be responsible for initially pitching products to large retailers and then consistently checking in to ensure their needs are being met.
In an enterprise setting, the decision-making process regarding the purchase of new technology is much more thorough compared to that of an individual starting a small sneaker store, according to analyst Ken Wong from Oppenheimer. Wong mentioned that Shopify has not previously experienced the need for this level of thinking and planning.
Title: Engaging in Enterprise Communication
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Shopify has not only recruited employees from Salesforce but has also focused on attracting larger business customers. They are using terminology familiar to big retailers and ensuring their presence in influential research reports like Gartner's Magic Quadrant and IDC MarketScape.
"They were not included in those competitive analyses three years ago," Wong stated. "Now, they are consistently brought up."
The picture shows Shopify president Harley Finkelstein. It is an image from Shopify's official company account.
Image provided via Shopify/AP Images.
In January, Shopify made two important partnerships. The first was with Mirakl, which allows merchants to sell on larger online marketplaces. The second partnership was with Manhattan Associates to help enterprise brands improve their omnichannel capabilities.
Shopify showcased its offerings at the Shoptalk retail conference in March. The advertisements at the event positioned Shopify as a key player in enterprise commerce, emphasizing its focus on commerce compared to traditional providers like Salesforce and Adobe.
Shopify is looking to fill the position of a Chief Technology Officer (CTO) for its team that focuses on enterprise consumer goods.
The job description states that as a trusted and reliable representative, you will have a key role in assisting large customers who are considering transitioning to Shopify. Your main tasks will include offering technical advice, building trust, and guiding customers through the process of transitioning to Shopify, making sure they understand the advantages and impacts of using the platform.
Shopify has stated that there are more new ideas and advancements on the way.
At Shopify's fourth-quarter earnings in February, president Harley Finkelstein stated that their partnerships highlight the company's strategic emphasis on becoming a major player in the enterprise sector for all aspects of commerce, building on their existing ecosystem that supports entrepreneurs and small to medium-sized businesses.
"We are seeing increasing opportunities for businesses to utilize Shopify, and we have strategic plans to expand our presence this year to capitalize on our current momentum."
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