E-commerce platform Shopify announced that its one-click payment service, known as Shop Pay, will be available to any U.S. merchant selling on Facebook or Google, even if they don’t use Shopify’s software to power their online stores. That makes Shop Pay the first Shopify product to be offered to merchants outside the platform. 

First introduced at its developer conference in 2017, Shop Pay is similar to other instant payment solutions that offer an easier way to pay online by reducing the number of fields a customer must complete during the checkout process. The service remembers and encrypts customer information, so consumers can verify with just a tap when shopping online and, recently, even pay for purchases in installments, thanks to a partnership with Affirm.

Shopify in February had expanded Shop Pay to Facebook and Instagram, in partnership with Facebook, but it only worked for existing merchants selling on those social platforms. In May, Google announced at its I/O developer conference that it would partner with Shopify on an online shopping expansion that would give Shopify’s more than 1.7 million merchants the ability to reach customers through Google Search and other “shopping journeys” that began through other Google devices with properties such as Search, Maps, Images and YouTube. The company declined to share how many of its 1.7 million merchants are already available on Facebook or Google, but said those are two of the most popular channels. 

Following the announcement, other merchants will also have the option to adopt Shop Pay for their own Facebook or Google stores. While it is still unknown how many will actually do so, Shopify notes that every day 1.8 billion people log into Facebook and 1 billion shopping sessions take place on Google.

The company also touted the advantages of Shop Pay, including its 70% faster checkout than typical checkout offerings, with a 1.72 times higher conversion rate, meaning fewer abandoned carts.

For consumers, the advantage of using Shop Pay over a traditional payment, beyond speed, is its integration with Shopify’s mobile app, Shop, which organizes and tracks their online orders across all merchants, including Amazon, so they can see when orders arrive, quickly ask questions and manage returns.

To date, the Shop app tracked more than 430 million orders, the company says. Over time, the Shop app can also customize a feed, including users’ favorite stores, to point to other recommendations, including those from local merchants. Shopify confirmed that the Shop app will be able to track Shop Pay-enabled orders from non-Shopify merchants.

“Since its launch, Shop Pay set the standard for payment experiences, facilitating more than $24 billion in orders,” noted Shopify vice president Carl Rivera, who leads Product for Shop. “According to studies, cart abandonment averages 70%, and nearly 20% is due to a complicated checkout process. Shop Pay makes that process fast and simple, and expanding to all merchants selling on Facebook and Google is a critical step in bringing best-in-class checkout to all consumers, merchants, platforms and devices.”

The expansion could be a notable challenge to other payment mechanisms, including PayPal, Venmo, Apple Pay and those offered by the platforms themselves, thanks to Shopify’s growing traction with merchants: one analysis gives its platform a 23% market share in the United States. Combined with the popularity of the Shop app, now the #3 shopping app in the App Store.

The news follows confirmation that Shopify took a significant stake in payments giant Stripe, the backbone of the Shop Pay service, as well as Shopify’s partner in merchant services, including bank accounts and debit cards.

Shopify says the Shop Pay service will be enabled for all U.S. merchants selling on Facebook in the “coming months” and rolled out to all merchants on Google by the end of 2021.

Source

Leave a Reply