Shopify has the best total cost of ownership in commerce, with up to 36% better TCO than the competition

Shopify ecommerce TCO header image

We hear it all the time. Our customers are more efficient after switching to Shopify. 

Now, we can quantify those efficiencies with hard numbers and objective research.

We commissioned a leading independent consulting firm to study TCO across major platforms in North America, including Shopify, BigCommerce, Salesforce Commerce Cloud, Adobe Commerce (Magento), and WooCommerce. 

The findings: Shopify’s TCO is on average 33% better than that of its competitors, and up to 36% better. 

Why did Shopify come out on top? Our product investments are focused on removing complexity for our customers—on making their lives simpler and giving them the runway they need to grow their businesses. That translates into more value for customers at a better total cost of ownership.

Highlights from the research underline that point:

  • On average, Shopify’s platform costs are 23% better than our competitors. Adobe’s platform fees and ecommerce stack costs are 42% higher, while BigCommerce and WooCommerce are 32% higher. 
  • On average, Shopify’s operating costs are 19% better. WooCommerce’s operational and support costs are 41% higher than ours. Adobe and Salesforce’s operational and support costs are 24% and 6% higher respectively, and BigCommerce’s are 21% higher.  
  • On average, Shopify’s implementation costs are 33% better. Implementation and setup costs for BigCommerce are 88% higher, while for WooCommerce, Adobe, and Salesforce it’s 49%, 42%, and 16% respectively.  

Those aren’t small numbers. They’re the kind of numbers that make a huge impact on organizations of every size and complexity level—that make the difference between being able to take a risk on a promising new product or market versus pouring money into a tech debt sinkhole.

TCO is made up of many layers of cost calculations 

TCO is notoriously difficult to calculate, so how did this leading independent consulting firm do it?

Between December 2023 and January 2024, the firm surveyed enterprise executives and interviewed experts in North America with extensive experience in commerce platforms. Questions were aimed at capturing their commerce cost data and insights across the following cost categories:

  1. Platform fees and ecommerce stack costs
  2. Operational, platform servicing, and support costs
  3. Implementation and setup costs
  4. Opportunity costs of lost conversions

There were many subcategories within each of these broader categories as the consulting firm worked to cover even the most minute elements that go into total cost. 

Taking a deeper look into some of the nuances here reveals not only the comprehensiveness of the study, but also the complexity of the decisions organizations must weigh as they strive for maximum operational efficiency.

For instance, an organization seeking to improve their operational efficiency may be attracted to low platform fees, but these can often obscure a full picture in which native enterprise functionalities and applications are missing. Bringing in external applications and plugins drives up tech stack costs, as do the technical and human resourcing needed to operate and support a platform—not to mention the costs associated with implementation. There’s a lot to consider beyond what you’re paying month to month.

“It took us one week with a developer to create specific templates [on Shopify]. I'm not talking about off-the-shelf ready-made pages because there are plenty of those with Shopify. Here, in just five days of development, our customized platform was ready.”—Vincent Arrouet, CEO and Cofounder, Sunology

Where the competition stands, from the mouths of experts

There’s a lot that stood out to me in this study, but the anecdotes from seasoned experts were what really grabbed me. 

On Adobe:

“When replatforming to Adobe, data migration alone took almost 6 months because we had to rebuild our product catalog. Spent $800,000 in migration alone and had to hire an agency specifically for migration.”

On Salesforce:

“System integration is the first major cost when thinking about a Salesforce implementation.” This is often due to the costs associated with connecting old and new platforms—an important consideration given that many of Salesforce’s customers are mid- to large enterprises that are replatforming from large, entrenched systems, rather than starting from scratch.

On BigCommerce:

“BigCommerce is not flexible in terms of custom development.” Compared to Shopify, other platforms like BigCommerce are slow to roll out new features. In contrast, we release hundreds of new product updates every year (just check out our most recent Edition—and every one previous to it). And we spent $1.7 billion in research and development in 2023 alone. 

And finally on WooCommerce: 

“WooCommerce, which has historically been a platform geared at SMBs and mid-market, and is limited in terms of its ability to scale up enterprise functionality, requiring merchants to integrate more applications and add increased complexity and risk to their technical infrastructure.”

For small businesses, WooCommerce may suffice. But most businesses are looking to scale—and doing so is a headache on a platform not built for it. When you outgrow WooCommerce, a move to Shopify is the obvious choice.

Being on Shopify pays—not being on Shopify costs

We’ve focused so far on cost advantages, but it’s also worth thinking about how much value different platforms allow an enterprise to capture. A difference in conversion rate can be applied as an additional cost for other platforms because it’s value that businesses would otherwise be capturing if they were on our platform instead. 

Our overall conversion rate outpaces the competition by up to 36%. When looking at the subset of four competitors evaluated in this TCO study, that’s an average of 18% higher checkout rate. Expressed as a percent of TCO, assuming a 10% margin on goods sold, that’s a roughly 1.8% TCO offset.

Every percentage point makes a big difference to small companies that are scaling. And for large enterprises that are already scaled, these numbers could represent millions in lost revenue opportunities. 

Shop Pay, our accelerated checkout offering, has a lot to do with this difference. When used, it can lift conversion by as much as 50% compared to guest checkout, outpacing other accelerated checkouts by at least 10%. The mere presence of Shop Pay, according to the previous study, can increase lower funnel conversion by 5%. 

Customer obsessed, with enterprise-level cost advantages and efficiency

At Shopify, we’re not just driving toward being the best commerce platform on the planet—we're here to deliver better value and better total cost of ownership to businesses around the world as well. “Efficiency” and “cost effectiveness” may sound like jargon, but they have high stakes in competitive markets. Our job is to give our customers the best tools, to adapt and grow as they do, and to be there as their partner and backbone so that they can do incredible things.