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Magento Versus Shopify: Which Platform You Should Choose in 2020?

Magento Versus Shopify: Which Platform You Should Choose in 2020?

Magento Versus Shopify: Which Platform You Should Choose in 2020?

OpenCart, ZenCart, OSCommerce, CubeCart, WooCommerce, Prestashop, nopCommerce… There are dozens of eCommerce solutions on the market. So many it’s hard to even keep track of them all.

But when it comes to market shares, the most popular platforms are Magento and Shopify. Both of them have big fan bases that consist of developers, regular users, and business owners.

The two communities are adamant that their platform is better than the competition. And they are kind of right. To a point. Both Magento and Shopify have strengths and weaknesses. Your task is to understand which platform is the right for you.

We are not going to take part in fanboy wars here. We want to help you make an informed decision which platform is best for your store. The situation is not as black-and-white as some users paint it.

Depending on the region and the average size of the stores you’ll either see more Magento or more Shopify stores.

But let’s put regional differences aside and take a look at the advantages and disadvantages of each solution. After all, both of these platforms are a decent choice for a store. When you pick one platform over another you just prioritize different things.

Magento vs Shopify: Key Differences

Magento and Shopify might look similar on the outside but, in reality, they don’t have a lot in common. The two platforms have different ideologies, priorities, and – most importantly – different core audiences.

Shopify: First Look

Shopify has been around since 2004. The Canadian company launched its product 2,5 years later, in June 2006, and then added the API and Shopify Apps in 2009.

Shopify is huge. According to their June 2019 report, Shopify hosts more than 1 million stores in 175 countries of the world. Their net revenue in the 2018 fiscal year was $1.07 billion dollars with good growth dynamics.

Shopify has the reputation of a simple product. Shopify’s plug-and-play mentality works great for customers who just start out or have recently migrated from another platform because they realized Shopify can be cheaper and fulfill all their needs at the same time.

Shopify: Core Target Audience

When we are talking about core target audiences, you’ll see that there’s some overlap between Magento and Shopify but, in general, both platforms have a very distinct feature set that attracts different kinds of users.

First, let’s take a look at Shopify users. This is what the core Shopify customer base looks like:

  • Customers who are new to online retail. These users just need a store to sell stuff. They are looking for an option that is easy to pick up – something that won’t cost too much but at the same time offer good reliability.

    They don’t know a lot about managing a store. They might not even know how to use a PC very well. That’s why it’s important for them that Shopify basically builds itself. All they need to do is pick a nice-looking theme and add their goods to the store. Once they know how to refill stock, receive payments, and ship stuff they are good to go.

  • Customers who came from a different platform. This is a more diverse crowd. It consists of users who were not happy about their previous shops. They could have moved from WooCommerce because of security issues and frequent hacker attacks.

    If they migrated from Magento, they might have realized they paid too much for features and customization options they didn’t really need. Or maybe they abandoned OpenCart after months of frustration with keeping extensions bug-free and up-to-date.

    For these users, Shopify is secure, user-friendly, fast, and cheap. This is what they came for and this is exactly what they get.

  • Long-time Shopify users. These guys have been around for a long time. They have grown their businesses alongside Shopify and know the platform inside out.

    They understand both its strengths and weaknesses and still stick around. It’s not uncommon to see larger shops hosted on Shopify – but most of the time as the store becomes bigger it tends to migrate to a more flexible platform.

As you can see, Shopify attracts aspiring entrepreneurs, mom and pop shops, dropship startups, and traditional small businesses. In late 2019, these users made up the majority of Shopify customers with over 1 million stores.

You should also understand that Shopify serves big brands: there are 5,300 Shopify Plus customers in 2019. That’s not a huge number when you compare it to the basic Shopify users.

The breakdown looks like this:

magento vs shopify
Source: Shopify & You

Magento: First Look

The first version of Magento was released in 2008. Since then the platform has gone through 1 major generation change. Magento 1 and Magento 2 are extremely different platforms, both in architecture and technology. We are going to discuss Magento 2 here because it’s more secure, more recent, and more capable of the two.

Magento’s big idea revolves around giving the user as much flexibility and customization freedom as you can. Unfortunately, the downside of this approach is that you get a platform that requires constant technical support of a dedicated developer team.

Magento is a system with its own rewards but the level of attention it needs can be challenging for customers with a minimal maintenance budget.

Magento: Core Target Audience

Magento core audience is different from that of Shopify:

  • Mid-sized businesses create the bulk of Magento stores. As their business grows, store owners become aware of the limitations of their own platform of choice. When they were just starting out, most eCommerce platforms could satisfy their needs.But with time they find out that their need for customization grows and it’s harder and harder to find a good fit for the store.

    They do the research. They get recommended Magento as an alternative. Why? Because building a unique or highly customized experience on other platforms is not viable. Magento also comes with a cost of its own. But at this stage of business development, they can already handle that kind of investment into their store.

  • Major brands need Magento even more. There are two factors that play into why large stores prefer Magento over other platforms: they need high customization and flexibility of Magento and have the budget to pay for it.

    It’s much harder for smaller stores to justify the cost of running a Magento store. We have a detailed breakdown for that but, in general, a smaller business operation will be intimidated by the amount of resources they need to invest in order to set up the store and keep everything going.

shopify vs magento
Source: shopping-cart-migration.com

Magento vs Shopify: Pricing Comparison 2020

It’s hard to accurately measure how much money you need to develop and run Magento or Shopify stores. All businesses are different – they have different goals, needs, and budgets. But let’s make a small table anyway, just to see how the 2 platforms measure up in terms of pricing and overhead:

Aspect Magento Shopify
Base version cost Free (Magento Community Edition) $29 monthly subscription and 2.9% + 30¢ per CC transaction for Basic Shopify.

Additional 2% per transaction when using anything other than Shopify Payments.
Advanced pricing $22,000+ for Magento Enterprise Edition.

Up to $125,000 for high-earning stores (see exact pricing here).Magento Cloud costs $40,000+ depending on your Gross Sales Revenue.
$79-$299 for advanced Shopify plans with 2.4%-2.6% + 30¢ per CC transaction (additional 0.5%-1% per transaction when using anything except Shopify Payments).

Shopify Plus (which is the equivalent of Magento Enterprise Edition) starts at $2,000 per month.

Development cost (average, per month) $0-$10, 000 $0-$15,000
Hosting (average, per month) $100-600 Included in Shopify Pricing Plans
Third-party services (average, per month) $0-$500+ $0-$100+

As you can see, your total costs will depend a lot on your needs here. Do you want to gradually install new extensions? Are you ready to invest in fancier hosting options to speed up your store? Do you want BI reports?

What about load handling or advanced traffic monitoring options? The possibilities to spend money here are endless. The costs add up to create a unique expenditure pattern for your own store.

Note: A lot of users think that Shopify is cheap. It’s not always true for a couple of reasons:

  1. Building a heavily customized Shopify store can be really expensive – which makes it comparable to Magento development costs. Imagine the need to deploy additional servers in order to add unique functionality or support third-party integrations. The amount of effort and know-how is as high as for Magento development: just take a look at the Shopify Partner Program or Shopify Experts.
  2. App subscriptions can really make up a hefty sum at the end of the month. An average Shopify store has 6 apps installed. Imagine paying $40 a month just for a single app!
  3. Other apps are free but include a paid action such as an image upload that could cost $1 per file. Depending on your needs, that can be a trickle or a fortune.

Magento: expect to pay $7,000-$140,000 to set up a brand new Magento 2 store in 2020. To be able to better compare the cost of running a Magento store, we have 4 separate guides on migration, optimization, hosting, and support. Take a closer look to see the cost breakdown.

Shopify: expect to pay $30-$100,000 to set up a brand new Shopify store in 2020. The final cost will depend a lot on your willingness to invest in the hosting infrastructure, extension development based on Shopify API, and other customizations.

No winner since Shopify doesn’t offer as much as Magento. Let’s call it a tie.

Magento vs Shopify: Customization Options

Magento Marketplace holds more than 5,000 third-party extensions and custom themes for M1 and M2 stores.

Magento is the ultimate playground for those people who love customization, modding, and tinkering. Its flexible nature allows developers to do almost anything with your store. If you can’t find the extension you need on Magento Marketplace, just make it yourself. Not easy. Not cheap. But very doable.

Shopify was initially designed as a closed off platform with limited customization potential. Even now, after more than a decade of active development, Shopify App Store can’t boast of powerful apps. Most of them don’t measure up to Magento extensions. They are more limited, less customizable, and have fewer features.

There are 6 major ways how Shopify limits store owners:

  • Shopify restricts stores to using their own payment gateway,
  • Shopify has an extremely simplified product category structure,
  • Shopify offers apps that don’t do much,
  • Shopify limits custom theme use to Shopify Plus users,
  • Shopify doesn’t offer advanced search options,
  • Shopify doesn’t cater to users with custom Checkout requirements.

Magento vs Shopify: Scaling Options

Magento performance and scalability issues can quickly become frustrating if your development team has no experience dealing with them. But, in general, scaling is well-researched and has a lot of working solutions. You just need to know what to look for.

Magento has a wide selection of tools to deal with scaling challenges:

  • performance-focused core configurations,
  • load-resistant database engines and DB configs,
  • Magento-optimized hosting solutions,
  • heavy-duty caching techniques with a multi-tiered architecture,
  • a wide range of third-party services.

Magento Enterprise Edition also has native support for load handling. Take a quick look at how Magento can become faster in our Magento 2 performance guide.

However, even though scaling is not a huge challenge for Magento users, Shopify has an advantage here. Most of the time Shopify just works.

Sometimes it doesn’t, though. The problem here is that you can’t do anything about Shopify being slow.

Another challenge for Shopify is that you can’t have the perfect Google PageSpeed score. Just forget about it. Shopify was built in such a way that you can’t optimize it for mobile or desktop Google PageSpeed.

With Magento, you can do anything but if something breaks, you are on your own. If Shopify breaks, you have to wait until it gets fixed. You have zero control.

Magento: expect to invest heavily in Magento optimization effort and support the store with at least a skeleton crew of developers in case something goes wrong.

Shopify: no matter how big your load is, Shopify got you covered.

Shopify wins here. Even though Magento can handle huge loads, Shopify just works.

Conclusion: Shopify or Magento?

We know people don’t like this kind of summary but we feel there’s no clear winner. Both platforms have their strong and weak points. What’s even more important is that Shopify and Magento are good at different things.

As a store owner, your goal is to choose the platform that works best for you. We created a small list that would help you pick either Magento or Shopify for your store. And who knows, maybe someday you’ll decide to migrate from one platform to the other. After all, it’s all about efficiency and common sense.

When You Should Choose Shopify

Choose Shopify if you need:

  • a small store with standard functions and navigation,
  • an easy to use out-of-the-box solution,
  • basic hosting options and load handling,
  • easy support of the store.

When You Should Choose Magento

Choose Magento when you need:

  • a major storefront that works exactly as you want,
  • build something according to your vision and requirements,
  • full freedom in choosing your payment processors and gateways,
  • extremely customized features that you can’t get anywhere else,
  • full control over your hosting and server configuration,
  • unique design and UX that stands out from the competition,
  • complex inventory, supply, or payment handling mechanism.

Want to get a better idea which platform is the best fit for your store? Let’s talk!

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