BigCommerce vs. Shopify: The Challenges of Being Second
The difficulties of staying in second place in the e-commerce giants' competition.
1The Competition Between BigCommerce and Shopify
Six years ago, BigCommerce was the second-largest e-commerce software company after Shopify. However, it couldn't keep up with Shopify's growth rate. In 2020, BigCommerce went public with a market cap of $4.8 billion, but today, that value has dropped to $200 million. Shopify, on the other hand, maintains its leadership with $11 billion in revenue.
2The Difference in Growth Rates
In 2020, BigCommerce's growth rate was 36%, while Shopify started at 26%. By 2026, BigCommerce's growth rate turned negative, while Shopify maintained a 30% growth rate. This difference widened the revenue gap between the two companies from 19x to 44x.
3Different Business Models
Shopify derives 78% of its revenue from transactions, while BigCommerce relies on subscriptions for 75% of its revenue. This difference in models accelerated Shopify's growth while reducing BigCommerce's revenues. Shopify earns more as transaction volume increases, whereas BigCommerce has a fixed revenue model.
4Performance in the B2B Market
BigCommerce targeted a niche in the B2B market and succeeded. However, Shopify's B2B transaction volume grew by 76% last quarter, while BigCommerce's increase was only 17%. This shows that BigCommerce's niche strategy was insufficient.
5Decline in Market Value
In 2020, Shopify's market value was $120 billion, while BigCommerce's was $4.8 billion. Today, Shopify's value exceeds $200 billion, while BigCommerce's has dropped to $200 million. This demonstrates how challenging it is to stay in second place.
6Differences in Payment Systems
Shopify Payments accounts for 68% of Shopify's revenue, up from 64% a year ago. BigCommerce is trying to improve its payment systems through a partnership with PayPal. However, Shopify continues to lead in this area.
7Analysts' Views
Analysts note that BigCommerce has been successful in the B2B market, but Shopify is growing four times faster in the same space. This indicates that BigCommerce's niche strategy is not sustainable in the long term.
8Future Projections
BigCommerce predicts its revenues will decline in 2026, increasing the company's future challenges. Shopify, meanwhile, maintains its growth rate and continues to lead. The difficulty of staying in second place makes BigCommerce's future uncertain.
Original article: SaaStr — BigCommerce vs. Shopify: İkinci Sırada Olmanın Zorluğu