Shopify has deal to take on Amazon's Webstore merchants
As Amazon drops role to support smaller businesses online, Shopify stands to gain the business
Amazon has struck a deal with Ottawa-based Shopify to migrate its Webstore businesses to the Shopify e-commerce platform.
Amazon began warning Webstore partners earlier this year that it had plans to shut down the service, which helps small and mid-sized businesses operate e-commerce sales.
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The endorsement of Shopify as a preferred migration provider could mean hundreds of new businesses will move to adopt Shopify technology. Harley Finkelstein, Shopify's chief platform officer, couldn't say how many businesses might be affected by the Webstore shutdown, but he called the opportunity "a huge endorsement for our product."
Webstore was a competitor for the Ottawa-based startup, and many of the merchants on Webstore are similar to current Shopify merchants.
Shopify stock soared 24 per cent on the news to $47.25.
"Many of Shopify's existing 175,000+ merchants already use Amazon as a sales channel, and this will bridge the gap between our two companies, with just a few simple steps." said Finkelstein.
Finkelstein said the attraction for the merchants is the opportunity to seamlessly move all their operations to the Shopify platform, including customer information, without any downtime.
"We want to make sure its a great first impression for them," he said.
Shopify is going to offer customers the ability to login and pay via Amazon, and it will offer merchants a way of shipping directly from Amazon warehouses.