Digital Transactions Authoritative, insightful and timely information for payments professionals
By John Stewart
@DTPaymentNews
Shopify Inc. reported on Wednesday that it is starting to see positive response from its very recent moves to adopt Apple Pay for the Web and in social-media commerce, specifically Facebook Inc.’s Messenger platform.
The Ottawa-based commerce platform enabled Apple Pay online for its merchants shortly after Apple Inc. announced the capability in September. “…Already tens of thousands of Shopify’s merchants have elected to offer Apple Pay as a means for checkout,” the company says in a press release announcing its third-quarter results, adding that so far the mobile wallet is speeding up checkout times by as much as 60% compared to card checkouts.
“Our merchants are seeing up to twice as many conversions” with the wallet, said Tobi Lutke, founder and chief executive of Shopify, during a conference call with analysts to discuss the company’s results.
Meanwhile, the company has expanded an integration with Facebook Messenger to allow its clients to sell directly through that messaging app. More than 30,000 Shopify sellers had signed up to use the original integration, which it introduced in the second quarter to enable merchants to converse with customers.
On the earnings call, Shopify’s top management said they were encouraged to add the commerce capability by the idea that customers would like to interact with merchants online and in-app as they have done in physical stores. “The Messenger platform is re-introducing things we took away from people [with the Internet],” Lutke said. Shopify’s move follows recent action by MasterCard Inc., PayPal Inc., and other payments players to add commerce capability to Messenger for their users.
Besides the Apple Pay and Messenger initiatives, Shopify also launched a new app in September that the company says allows merchants to manage a Web business with only a mobile device. “Anyone can start and run an entire online business from their pocket,” Lutke said. Though it’s early, the company did not report results for the app so far.
Shopify, which was founded in 2004 and went public only in May of last year, provides commerce tools for online and physical merchants. With its Shopify Payments service, it acts as an aggregator, bringing payments capability to merchants without their own merchant account or payments gateway. For the quarter, Shopify Payments volume totaled $1.5 billion, or 39% of the $3.8 billion in gross merchandise volume processed by the company for a total base of 325,000 merchants. Shopify has doubled its overall volume since the third quarter of 2015.
All told, the company reported $99.6 million in revenue for the July-through-August period, up 89% from the third quarter last year. Its net loss for the quarter came to $9.1 million, up 94% from $4.7 million a year ago.
