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New Shopify App Offers Local SMBs a Bridge to E-Commerce

Shopify on Tuesday unveiled Shop, a consumer app that lets users discover local businesses, receive relevant product recommendations from their favorite brands, check out effortlessly, and track all their online orders.

It can gather and track orders and receipts automatically, but it also works without auto-tracking.

Consumers can list their favorite stores to get a customized feed with deals, trending items and customized recommendations.

The app has a search feature that lets consumers find local stores and access their pickup and delivery options.

The Shop app makes it easy for consumers to ask a question or make a return.

Auto-tracking of orders and receipts, storing them in a single place, and accessing policies and returns with one tap are par for the course for any mobile shopping app, observed Rebecca Wettemann, principal at Valoir.

“The difference I see is it’s exposing shoppers to smaller retailers that can’t necessarily offer their own app to remain competitive,” she told the E-Commerce Times. “This is particularly important right now, with the pressures on smaller retailers and consumers’ desire to support local businesses.”

The coronavirus pandemic has sent online purchases skyrocketing.

Consumers “are very resistant to downloading e-commerce apps for small retailers because it’s just not worth the hassle,” said Mark Lewis, CEO of Netalico.

The Shop app is available for both iOS and Android.

Bringing It Together

The Shop app integrates features from Shop Pay, a one-click accelerated checkout, and Arrive, a Shopify app to track online orders. Shop Pay has processed more than US$8 billion in sales so far, while 16 million shoppers have used Arrive to track their e-commerce orders.

“I stumbled onto Arrive about eight weeks ago and have to admit I was skeptical at first,” remarked Liz Miller, principal analyst at Constellation Research. “Why in the world did I need an app to track all of this when I can do the same thing within each retailer’s e-commerce site?”

Now, she’s a believer. “Multiple retailers, multiple shippers, all in one spot, including details on my order, stock availability, multiple packages … right there,” she told the E-Commerce Times.

“I’m in on using Shop based on how easy my checkout experience has been at Shopify retailers and then with this app,” Miller said.

Privacy and Security

Consumers’ personal details will not be sold, and they can delete their account at any time, said Shopify. Its servers meet PCI compliance standards for storing credit card information, and consumers’ personal and payment details are encrypted end to end.

The Shop app has been verified independently to handle emails securely in accordance with Google API Services, Shopify said.

“My guess is that Shopify will make personal data available, at a cost, to its stores,” commented Nicole France, principal analyst at Constellation Research.

“PII may not be included, but it’s not clear from these announcements how easy that might be to reconstruct based on available information,” she told the E-Commerce Times.

Deconstructing the Shop App

Existing Shopify merchants will love Shop because it lets them “offer an app experience to their customers without any work on their part,” Netalico’s Lewis told the E-Commerce Times.

However, consumers “won’t really care about it or know that it integrates into merchants they shop from unless Shopify or merchants push it to them,” he added.

Still, the app “puts customers in the driver’s seat, where they should be,” Constellation’s France pointed out. “This is crucial. So is the fact that customers’ personal details won’t be sold.”

The Shop app “may well prove a fundamentally different and revolutionary model for connecting customers with brands on digital platforms,” she said.

In addition to making things easy for both buyers and sellers, the Shop app provides value, France observed. “As shipping options and times have been upended in the midst of stay-at-home orders, the ability to choose among them and track progress is more important than ever.”

Going Head to Head With Square

The local search feature is not likely to be utilized heavily, Lewis said.

“It’s much more about Shopify trying to break into the brick-and-mortar market, which Square already dominates,” he told the E-Commerce Times.

Square earlier this year partnered with UPS to integrate its shipping solutions into Square’s platform for sellers, a move that could help it compete with Shopify.

“Shopify is definitely more e-commerce oriented and e-commerce first than Square — and particularly as consumers shift their buying to online shipping, they’re in a good position to help merchants,” Lewis noted.

“Local merchants need these capabilities more than consumers,” contended Ray Wang, principal analyst at Constellation Research.

“This is the ability to scale out local capabilities globally,” he told the E-Commerce Times. “Bringing small merchants together and giving them the tools of a Google and Amazon at scale.”

The Shop app gives small businesses “enterprise-class capabilities at the SMB level,” Wang said. It is “the bridge between brick-and-mortar retail and e-commerce. It’s Shopify’s push to go even further downmarket to local retailers and bring them into the e-commerce age.

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