Shopify (TSX:SHOP) is expanding the e-commerce arrangements it has with internet and social media giants Google and Facebook.
Shopify has announced that it will open its e-commerce checkout system to all retailers selling through Google and Facebook, expanding an existing collaboration with the two U.S. technology giants and marking the first time that the Canadian company has offered a product to merchants that don’t directly use its platform.
Retailers who sell products through Google and Facebook properties such as Instagram, YouTube and Google Maps will be able to offer shoppers the chance to pay for their purchases using Shopify’s "Shop Pay" tool.
Shop Pay is a checkout product that stores users’ information, speeding up online transactions. Right now, retailers have access to Shop Pay through various social media platforms, but they must be Shopify merchants to use it.
From its early days helping retailers set up websites to shift their stores online, Ottawa-based Shopify has expanded to offer a suite of products, including shipping, data analytics and small business loans, and now describes its business as a "retail operating system."
Small companies pay a monthly fee to use Shopify’s core e-commerce software; larger enterprises may pay thousands of dollars a month based on sales volume, a model that has proved successful.
More than one million merchants sell on Facebook and Google platforms. Each day, more than 1.8 billion people log onto Facebook and a billion shopping sessions take place across Google.
Global e-commerce has surged during the pandemic. Market research firm eMarketer estimates that online retail sales will be worth $4.89 trillion U.S. in 2021. Shopify’s stock rose 0.8% to $1,317.59 U.S. per share on the news regarding Google (NASDAQ:GOOGL) and Facebook (NASDAQ:FB).
