When it comes to e-commerce platforms, you couldn’t get two more different than Shopify vs Magento. Although both are powerful and very popular, that’s about where the similarities end. Here’s our overview of both platforms, their pros, cons and costs.
What is Shopify?
Online business owners with an eCommerce website need a shopping platform that is aesthetically pleasing, affordable and easy to use for you and your customers. Shopify ticks all three boxes – and offers much more. There is a wide range of templates that can be customised to suit your brand image and is ideal eCommerce platform for drop shipping.
Is Shopify SAAS?
Yes, Shopify is fully-hosted, there is no open source code to download and install on your own server; everything is managed by Shopify.
Shopify Setup Costs
Shopify looks to provide start-up business owners with a cost-free solution by offering a 14-day free trial. After that, the monthly payments are incurred in accordance with the plan you choose.
On top of your monthly service fee, you also have others costs such as email, transaction fees and possible design costs if you hire a web developer. However, it is possible for you to customise templates yourself if you can work with Shopify ‘Liquid’. Overall, Shopify setup costs can cost anything from £600-£3000.
Shopify Monthly Costs
Shopify is a ‘software as a service’ (Saas) platform which means you have to pay a monthly subscription fee. There are five options, the cheapest of which is Shopify Lite which is an alternative low-cost option. The Shopify pricing plan is as follows:
- Shopify Lite: $9/£7 month
- Basic Shopify: $29/£22/month
- Shopify: $79/£59/month
- Advanced Shopify: $299/225/month
- Shopify Plus: Negotiable depending on requirements. Contact Shopify sales for setup
In addition to monthly subscription fees, Shopify charge transactions fees if you use external payment gateways such as Paypal. However, there are no transaction fees when you use Shopify Payments. Transaction charges are:
- Basic plan: 2.0%
- Shopify: 1.0%
- Advanced Shopify: 0.5%
Transaction fees are used to cover the cost of maintenance and the supply of technology Shopify use to power your sales. Where you will feel some loss is the credit card fees for point-of-sales. Shopify charge the following credit card fees.
- Basic plan: online purchases = 2.2% + 20p / in person (point of sale) 1.7%
- Shopify: online purchases 1.9% + 20p / in person (point of sale) 1.6%
- Advanced Shopify: online purchases 1.6% + 20p / in person (point of sale) 1.5%
Shopify Hosting Options
Shopify is a hosted eCommerce platform so there are no hosting fees to pay. The cost of hosting is including in all Shopify packages.
Shopify Set-up Skills
Setting up Shopify is easier if you are tech savvy. If you know your way around a basic interface you will not have any problems. If you plan to customise your eCommerce to suit your brand colours, hiring a web developer is advisable.
Shopify uses a unique coding language called “Liquid”. This can complicate the customisation process even for programmers that know HTML and CSS code. For start-ups the best option is to use one of the free templates and only make basic modifications that do not require code. Once you start earning from your eCommerce website, you can always make modifications as and when necessary.
Shopify Theme Availability
Shopify offer 10 free starter templates and around 50 premium themes, although there are literally hundreds of themed Shopify templates available across the web. Templates are responsive and have two or three variants. Although the free templates are well designed, the premium themes are more aesthetically pleasing and project a professional appearance. Premium templates cost between £100-£135 but have more functionality and enable you to add videos.
Shopify Day-to-day Running
Adding products, images and content is straightforward in Shopify. If less tech-savvy business owners shouldn’t encounter any problems with the interface.
Shopify Payment Options
Shopify has a couple of payment options for online users and credit card customers. The least expensive option is to use Shopify Payments. This is a built-in payment gateway and does not carry a transaction fee on purchases, although credit card charges do apply.
If you choose to use a recognised third party gateway, the transactions fees mentioned above apply. However, there is arguably more potential to make more sales through third-party gateways, like Paypal. Should you choose to opt for an external payment process, you need to register for a merchant account with the third party which may incur a transaction fee or monthly payment.
Shopify Product attributes (whether unlimited or not)
Shopify called product attributes Options and Variants. For example, an option is the Size of a T-Shirt of its Colour. Then the Variant is Small, Medium and Large or Green, Pink, Black.
You are allowed up to 100 variants on each product, which could be 10 options with 10 variants or 1 option with 100 variants – or any other combination.
The Shopify platform does not have a limit on the number of products you can sell.
Shopify Typical Annual Running Costs for the first year then ongoing years
The good news for eCommerce owners using Shopify is the fees go down each year. Running costs are as follows:
|Set Up and 1st year
Shopify Customer Support Options
Of all the eCommerce platforms available, Shopify boasts one of the best customer support teams of them all. Lines are open 24/7 and they can be contacted by email, live chat or phone. The support team are knowledgeable about usability queries, but if your question is a technical issue, you may have to wait until a developer gets back to you.
What is Magento?
Magento is a powerful eCommerce platform best suited to large eCommerce companies. The ‘enterprise level’ software has a lot to offer but requires development experience so is best suited for companies that have an in-house developer or can afford to pay a third party developer.
Is Magento SAAS?
No, Magento is not SAAS. You will need to download and install the Magento code on your own server and therefore you will need to factor in hosting costs.
Magento Setup costs
A major bonus: there are no setup charges or transaction fees to use Magento. However, in order to set up the online store you want, there are a significant number of other set-up costs including payment gateways, SSL certificates, product and shipping plugins which can cost several thousand pounds. Not forgetting that, unless you’re technically savvy, you’ll need a developer to configure Magento for you.
Magento Monthly Costs
Magento targets large enterprises so is not the cheapest eCommerce software around as you have to factor in setup costs which usually involve an agency or specialist developer.
In addition to set-up fees, there are a number of other costs to take into consideration; hosting, payment gateways, development, and various set up costs. It is estimated that the annual running costs for a basic Community Magento Edition (CE) will set you back between £1,000 and £5,000, which equates to the costs of your server hosting fees, plus minor additions like SSL certificates, renewing plugins, etc.
Large eCommerce companies typically need the Magento Enterprise platform which cost between £20,000 and £580,000 a year to run, develop and maintain. The exact pricing plans for Magento vary quite widely as you can choose between the (self-hosted) Enterprise Edition or the Magento-hosted cloud version Enterprise Cloud Edition.
Magento Hosting Options
Magento is a standalone platform so you will need a web host, unless you opt for the enterprise Cloud Edition, which is only realistically an option for larger stores with big budgets. There are plenty of hosting companies offering good packages, but not all are optimised. Hosting prices vary from £40-£350 per month depending on which additional services you need in addition to basic hosting.
Magento Set-Up Skills
In general, Magento users need some technical skills. If you’re planning to manage the software in-house you will need someone with development skills. It is not the easiest e-Commerce platform to use. However, if you are feeling a little overwhelmed, take advantage of the ‘Start My Store’ wizard which you will find at the top of the administrator page. This will help get you started and has demonstrations of how to create the design, add products, payments, shipping and everything else in between.
Magento Theme Availability
If there is one area which lets team Magento down is the lack of built-in templates. That’s not to say you won’t find a design suited to your eCommerce setup, but needless to say, you will have to pay for a decent template. There is a saving grace, however. ThemeForest list over 500 Magento themes starting from £30.
Magento Day-to-day Running
Although coding skills are required for to set-up your eCommerce store with Magento, daily management processes are relatively straightforward. The dashboard is clean and the intuitive user-interface makes navigation simple. The dashboard also gives you a quick overview of analytics and transactions.
Content can be easily imported from your computer’s hard drive and customising product pages does not require any technical skills. You use the admin panel to manage transactions; orders, fulfilment, shipping, invoices and extended credit are all accessed from one location. Overall, Magento is pretty easy to use and offers customer-friendly features such as a one-click buy button and zoom.
Magento Payment Options
The payment options in the Magento software has everything you would expect from an enterprise level software. Businesses can offer customers several gateway options, more than other eCommerce sites. This gives you more flexibility and professionalism.
Magento is compatible with PayPal, Simple Pay, Amazon Payments, Google Checkout and Authorize.net. Furthermore, there are no transactions fees or what customers may deem as ‘hidden costs’ – tax and shipping costs are built into the total invoice amount before customers head to checkout.
Another advantage of the Magento payment options is the “bill me later” program. This gives buyers the opportunity to set up convenient and affordable direct debits whereby they make monthly payments rather than a one-off payment. This is a feature online buyers appreciate for expensive items.
Magento Product Attributes (whether unlimited or not)
There is no limit to the number of products or product attributes that you can run in a Magento install.
Typical Annual Running Costs for the first year then ongoing years
Given Magento targets large eCommerce companies, the annual running costs are high. The licence for the hardware is £8,500 for the first two years and reduced to £6,500 in the third year. On top of that is the cost of a hosting plan which varies quite widely: from £400 upwards a month.
Magento Customer Support Options
Businesses that opt for the Magento CE are without technical support other than a users forum where you can tap into a huge knowledge base of active users. The Magento EE version does offer a tech support team.
How The Content Works can help
Here at The Content Works, we specialise in Technical Website Audits. We’re here to find the issues on your website that are causing you to lose visitors, see poor conversions rates and ultimately we highlight the issues costing you money. Take a look at our services page to see the technical website audits we offer. Call us on 0207 305 5599 to discuss your situation and we’ll show you how we can add value to your business.