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Rumor: Will Microsoft Acquire Shopify?

Microsoft’s Corporate Vice President of Global Retail and Consumer Goods Shelley Bransten has been out creating hype around Microsoft’s desire to add an eCommerce platform to their suite of tools.  In an interview with “The Information”, she says that she has “a lot of respect” for Shopify and added it’s an area where Microsoft has its own ambitions.

From that interview I have seen quite a few articles make the assumption that Microsoft will make a run at acquiring Shopify. In my opinion, that acquisition doesn’t make a lot of sense. However, I’m also old enough to know that it doesn’t have to make sense for it to happen. Let me give you a little context as to why I don’t think this is the perfect fit.

Shopify has grown their business and legitimacy by building hype utilizing the fact that they have a large number of merchants on the platform. Over 800,000 the last I heard. That’s a ton of customers and an impressive feat no doubt.

However, only 5,300 of those are Shopify Plus customers. That’s a rapidly growing number and good news for Shopify, but it means that the overwhelming majority of their customers are far from enterprise customers.    

They acquired their customer base by advertising to the absolute beginner, those with no ecommerce experience. “You could be the next Shopify Millionaire” they claimed. All you need is a dream and grandma’s cookie recipe.

I’m not knocking them for this strategy. I think it was genius and it has obviously worked well for their growth. However, I am very curious as to how many of those 800,000 merchants are doing little to no transactional volume. How many are beginners that signed up trying to “build passive income” like Shopify’s ad’s or all of these affiliate marketers and “gurus” on YouTube are promising them then quickly found out that it’s not that simple.

How does that apply to Microsoft’s ambitions to be in the eCommerce platform game?  Well, in the reports I read, Microsoft is considering adding eCommerce because it’s customers are asking for it, especially the larger ones.  

That last note is the important one here:  the larger customers are asking for eCommerce. That means Microsoft is looking to add enterprise eCommerce to it’s roster of products. Although we can argue if Shopify Plus fits that bill, I have my doubts that Microsoft wants to deal with the majority of the customer base that Shopify supports.   

There’s also the fact that Shopify is a publicly traded company. Why go out giving clues that may increase the value of something you are looking to buy? That just makes no sense.

Based on some previous Commerce related job listings that have surfaced, all clues point to Microsoft building internally and launching an Azure Commerce Cloud product sometime in the near future.

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