Keeping up with Shopify
Since the beginning of 2023, Shopify has been keen on introducing blockchain tools to its platform.
These are the most important updates you should keep up with:
- In 2022, Shopify processed ~$80B in order value across 4.4M+ digital stores, and was used in 175+ countries.
- In early 2023, Shopify partnered with thirdweb to launch CommerceKit, which is a set of developer tools that allow brands to easily integrate Web3 features.
- By introducing blockchain, Shopify lets users sign in with Ethereum, meaning that they don’t have to give away their identity or any other personal information to third parties.
Now Shopify is letting brands recognize & reward loyal customers by giving them NFTs. Holders of the NFTs can get exclusive products, discounts, and even tickets to IRL events. All they have to do is connect their crypto wallet to Shopify and voila - instant access to cool limited-edition stuff.
Source: Milk Road
Why is this a big deal?
Because 600 million of its users are now being exposed to blockchain technology and learning about its benefits.
And not only that; it’s providing merchants with new tools that can inevitably improve how they’ve handled business for as long as they remember.
But how useful is it, really?
And how much can we expect eCommerce to change due to blockchain stepping foot into the industry?
We’ve reached out to the expert on the topic, the CEO of OmniShop, Dušan Popović.
Do you believe, and have you experienced it, that introducing NFTs and tokengated commerce has a positive impact on community building, customer retention and ROI?
– There are many examples of smaller communities being built using tokengated commerce. And if we examine most of them, the main reason for those communities to exist is the blockchain technology itself. We still do not see more prominent examples of tokengated communities with the user base being outside of the blockchain.
“OmniShop is a platform for creating apps for mobile stores, which directly solves one of the biggest problems, which is that 80% of items are left in a shopping cart. Our application is synchronized with the website, so there is no additional interface that sellers need to master,” said CEO Dušan Popović. “OmniShop is a platform for creating apps for mobile stores, which directly solves one of the biggest problems, which is that 80% of items are left in a shopping cart. Our application is synchronized with the website, so there is no additional interface that sellers need to master,” said CEO Dušan Popović.
– With that in mind, there are more and more tokengated commerce solutions created every day. In time, with the user interface to Web3 becoming transparent to the end user, I believe that will be one of the best ways to gamify communities and capture the attention of involved users. To recap, current efforts are giving good results, but mostly to the early adopters who are still here because of blockchain technology.
How will Web3 affect eCommerce?
The fact that Shopify is now using blockchain tools means that nearly 600 million of their customers are now exposed to this technology and have the opportunity to learn more about it. Do you think it will have a positive effect on the general opinion of the non-tech population toward blockchain? Or do you think it doesn’t really matter in the grand scheme of things?
– We can think separately about 2 million merchants using Shopify, and the 600M end customers using those merchants’ shops. There are two ways the adoption grows:
- Adoption by merchants who want to adopt blockchain technology and expose their customers to it, slowly educating them about the possibilities;
- Adoption by those same customers who have been exposed to the blockchain with positive outcomes, and will then ask other merchants to implement the same features on their websites.
Source: Digital Serbia Initiative
– So, it is a two-sided growth model basically. With the state of blockchain interfaces and UX as of today, we still see a lot of problems in adopting new technologies. Two things need to happen for it to become mainstream: tooling needs to become easier and more intuitive to use, and users need more education about the technology, its benefits and how exactly to use it in a safe way.
In your opinion, did Shopify introduce blockchain because it’s a current buzzword or because this technology has an actual capability to improve eCommerce as we know it? If so, how?
– Shopify is a mature business taking second place in a number of webshops, right after WooCommerce. With that in mind, I don’t think they pay much attention to buzzwords as such. On the other hand, their app ecosystem allows others to experiment and implement anything new out there, with even a tiny potential to give a better or a different user experience for shoppers or store owners.
With blockchain technology, a whole new frontier of purely digital trade is born. And Shopify sees it very clearly and is invested in adopting it.
– Some of the ways we can see blockchain influencing eCommerce as we know it are:
- Easier escrow. Smart contracts can allow very innovative ways of using escrow, but also a lot of other things. Programmability makes it a powerful tool.
- Digital ownership with NFTs. NFTs are much more than just pretty pictures on the blockchain. They enable the infrastructure for a true digital ownership framework. Of course, it has to be recognized by institutions before it can be used to represent ownership of your car or house, but the groundwork is done.
- Microtransactions and payments without borders. The high throughput of blockchain systems is allowing for a crazy number of (micro)transactions which could make shopping experiences much more granular. You can have true pay-as-you-go models where the funds are taken in very small steps, such as every second for your usage of a product. And you could pay for it from any country in the world to any other country. And that is just a revolution.
- Enhanced logistics. Blockchain systems enable traceability and transparency to exist in interconnected systems without trust (or middleman). And that is something logistics systems can really take advantage of.
- Token gating, as we already mentioned, allows for various types of rewards and gamification.
What does this mean for merchants?
One of the ideas that you’ve had for OmniShop is that merchants can collect users’ data to grow their businesses. Can you explain to us how it works and how does it align with current data privacy policies?
– There are two ways you can utilize data to enhance the customer experience and thus the business. The first one is collecting personal data. This allows you a closer and more personal connection with your customers. You can celebrate their birthdays with them, and communicate via various channels like email or SMS. And even send them gift cards and new collection brochures via snail mail. And this is not something we do. That is something we leave up to the merchant and their communication strategy. This data is, as you mentioned, regulated by the GDPR act in the EU, ICO u UK, CAN-SPAM act in the US, ZZPL in Serbia and many others for different countries and territories.
– What OmniShop does is another approach. We leverage the aggregate purchasing behavior of all the users on the system, without knowing who they are. This allows us to utilize the data and create a data-driven product architecture. This is done without jeopardizing customer identity, but still creating additional value for both the end customer and the merchant.
The way you see it, will it become a standard practice for similar platforms, including OmniShop, and become some sort of a necessity?
– As the market grows and gets more mature, the bar rises as well. Right now, there is a handful of merchants who are using data to their advantage. And they do measure and see the benefits of it. But as more and more merchants understand that they need to be online, competition leads merchants to be more open to using their data and technology to help them with it. And I can only see it become used more until it becomes a standard in the industry.
– And merchants who are first to adopt it, will be reaping the benefits. We are working very hard to bring machine learning and best data science practices to our merchants. And we are doing it in a seamless and transparent way so they do not feel the steep adoption curve others might encounter.
The future of Web3 commerce
Do you see this future transformation as an intriguing change or as yet another difficulty for the people from the industry?
– I’m not sure it’s either. On the other hand, any change is a tiny bit of stress for us humans, it’s just our nature. And with all the technological progress, we’re bound to change every so often. So as much as tech is making our lives easier, it’s also making our lives harder by keeping us on our toes.
As much as new generations are more prepared for constantly changing, it is increasingly harder for the older generation. This is why we see slower adoption rates than we would hope to see. It is the new, hungry, and eager startups that are on the adoption curve, hoping to change the status quo.
Is there potential for Metaverse in eCommerce?
– One of the biggest challenges people face while shopping online is not being able to interact with physical products. You are not able to feel them, play with them, put them on, or smell them. And although we probably won’t be able to have a completely immersive experience just yet, we are gradually accepting the new virtual reality.
This trend will take some time to pick up I believe. We’re not there yet both from the technological side and much less from the adoption side. But in the end, metaverses will enable us to have an instant experience of things and places that may be unreachable to most of us in a lifetime, and that is truly great. So, for eCommerce, this will be a very practical interface bridging the gap between us as customers and brands far away. It will further obliterate the existence of countries and borders, bringing us closer and closer.