Shopify has sealed a new partnership with Microsoft that lets its merchants to expand their reach. This occurs through Microsoft’s Channel App, letting merchants tap into Microsoft’s Search and Audience networks. This move also extends Shopify’s recent channel integration streak (more on that in a bit).
The integration specifically plants the Microsoft Channel app within Shopify’s existing dashboard, giving the latter’s merchants greater one-stop-shop convenience. From there, they can choose to have their product listings show up automatically (and free) in the shopping tabs of Microsoft Bing and Start.
Notably, Shopify’s integration works in the other direction as well. In other words, the listings that show up in Microsoft’s properties contain “Buy Now” buttons. These let shoppers add items to a cart that’s hosted by Shopify, or take users back to a given merchant’s Shopify page.
This all follows the shoppability trend we’ve been tracking. In addition to typical eCommerce destinations, transactional buttons are popping up everywhere — from social feeds to SERPs. This isn’t a new phenomenon of course, but it’s been accelerated with the eCommerce inflections of the Covid Era.
Wide Net
Back to Shopify’s integration streak, Microsoft is the latest of many partnerships that give its merchants greater distribution and one-stop-shop amplification. It’s motivated to do this in order to create a more attractive service for merchants, thus boosting new activations and retention.
That list of recent partnerships includes Walmart, Google, Facebook, and TikTok. These covers a range of distribution points from Walmart’s online store to TikTok’s newer but promising commerce engine. Shopify is clearly casting a wide net and we expect other integrations to follow.
Shopify’s goal here is to approach Amazon-scale. Of course, it won’t reach those levels anytime soon, but it does want to offer its merchants distribution scale that’s at least competitive. It otherwise attracts merchants through better unit economics (SaaS pricing versus Amazon’s revenue share).
For all these reasons, the Microsoft integration — much like Shopify’s other recent deals — is free for the merchant as noted. Shopify negotiates on their behalf to gain this distribution channel for them, which usually involves the promise of greater product libraries and network effect for the channel partner.
Meanwhile, this move is obviously well-timed for the oncoming holiday shopping blitz. We’ll continue watching Shopify to see how it positions itself at the intersection of the holidays and the post-covid era.
