Shopify to Acquire Delivrr for $2.1B

Isn't shopify also a lot of non-Shopify branded web shops? I don't think crappy dropshipping stuff from Asia will ever go away, that's why middlemen are important, those can filter out the bad crap products. At which point those middlemen also become a brand, it doesn't work without reputation. Funny little commerce actually changed from the first time someone sold a stone knife for a handful of berries.

Amazon is mostly drop shippers too, and Etsy for that matter, what's being sold by "shops" on Shopify or "merchants" on Amazon isn't really the issue. It should not at all be surprising that "low effort" shops are more numerous. There's quality stuff on all those platforms, and Shopify (for now) is better to the merchants.

Amazon's total dominance of online shopping is because of their logistics network and having more than one company providing fast inexpensive shipping is good, it means people have somewhere else to go if Amazon gives them a raw deal.

I buy lots of stuff from Shopify merchants who make / source unique products: clothing, bike gear, skincare, electronics. I'm sure there are a lot of crappy drop shippers too but I'd hope to not see them in a search experience. Guess that would be up to Shopify to sort out. But I'm hopeful. Anything who's been paying attention realizes that trust in Amazon is eroding fast. It's an opp for Shopify.

disclaimer I work for Shopify, opinions are my own.

I do not think this is true. I don't know the % of shops that are drop shippers, but I do not think it's the majority. Most Shopify merchants are selling things. A lot of stores are Shopify stores that are on custom domains and unless you look at the source, nothing tells you that they are a Shopify merchant. I know of RPG and Board Game publishers and designers with Shopify stores, a local coffee shop and coffee roaster is a Shopify merchant, food companies, etc. There are companies that that have IPOd that started as Shopify stores selling their own things; Which is really cool.

As with any open marketplace, there will always be varying degrees of quality.

The best way to respond is to build tools that allow the market to bring high quality shops to the top, and lower quality shops that provide poor customer service or fraudulent products to be suppressed. In this way, the consumer benefits through the consumer experience of others.

Shopify is a little too close to their shops to be able to provide this type of tool, because they have the obligation to support each and every one of their shops.

Third party search engines, built to support the Shopify platform are able to implement these types of tools and bring a user curated shopping experience to shoppers.

So, you're right in that a search bar can shine a spotlight on the dark corners of e-commerce, but that doesn't mean that there aren't ways to create a better experience.

The next shopify site I'm queued up to work on is something I'm choosing the platform for because its POS offering looks like it offers a better rate than stripe terminal. I think it's a pretty sweet option if you're selling something in-person or services to this end, I like the timeslot plugin stuff.

Pretty sure as I understand it that a lot of that dropshipping crap from alibaba kinda petered out with those massive shipping container delays

Have you considered offering the service as an API?

Awesome. How do you source your merchants? I ran two searches for specific merchants I buy from and didn't find them.

Hey Craig.

We appear to be working on solving the same problem! :)

I had a chance to use delomore and you're off to a great start... Just finding the shops to index is certainly a challenge. When we search for an item like "Oxford Shoes" the search returns are for all the shops that may sell shoes, presumably oxfords.

Are you also building out the ability to return individual items that match the search query? In order to be a functional shopping search engine, users will want to be able to view and click on relevant results, and not just the shops that might sell the items.

We have built a search engine that indexes 100 million items from 140,000 shops... We are currently returning product cards from relevant results for the search query, and we're working to help shoppers find the exact item they are shopping for, and compare against other items from other sellers...

we are https://vendazzo.com/

daniel

I just tried out delomore and am very impressed. Bookmarking now!

I always considered doing something like this and then I realized the only technique I know to get all shopify sites is subdomain enumeration and that's probably not uhhh white hat or whatever the term is

I'm sure there's people doing market research out there who don't really give a damn about any of that but I'm curious as to how you build out your search functionality if it's not that?

Me. I use eBay a few times a month, but never, ever touch Amazon.

*shrug

It's funny, I sent them an email long long long time ago asking if there was some way to source all products on Shopify so I could build just this. Maybe they noted it and turned it into a product.

Super sweet. I love Shop app. Tracking shipments is a nice way to get app installs... and you can backdoor a shopping experience as you roll out new versions. Well played!

How is this not Amazon minus each storefront page is custom designed?

Love the Shop app. But one major compliant is that there is no email verification. So I get notified of every order that accidentally used my email address (common Indian name @ gmail.com). Wish I could only be notified of orders that I placed.

I worked on the shop app too (backend and iOS app). Small world.

I’ve moved on from shopify but still use the app.

As a seller on Amazon I whole heartedly disagree.

You have to experience trying to sell on Amazon to understand that their policies forbid quality markers like stating patents. The entire system is rigged so that people who design and make products can’t even differentiate from the knock offs.

Amazon needs the competition so there is someplace on the internet where domestic manufacturers can have a leg up.

> (mostly because you can't easily compare the price)

there would be third party scrapers to compare prices. I don't think you can really solve the problem of poor quality dropshippers, except if the platform mandates a return policy which doesn't cost the user.

A lot of the time that's gonna be more expensive in Canada, if not only cause a lot of manufacturers only have warehouses in the US. You'll likely pay more for shipping (which could be significant, like $15 shipping on a $20 item), potentially get a letter a few weeks later from the courier saying you owe them money for import fees, and will likely wait longer than if you just got it through the free Prime subscription you're already paying for.

Before you totally give up, perhaps try one more? We built a search engine / shopping aggregator to help shoppers find items to purchase directly from independent shops and brands. We currently help shoppers find items from 140,000 Shopify shops, making 100 million items searchable for the shopper.

By Shopify building out their fulfillment network, this will help close the gap between the product offering from Shopify shops and Amazon. In the end, the shopper will get a better shopping experience by shopping directly from the independent shop, because they can control the customer service experience, and not a third party that sits between the shopper and the seller.

We're extremely bullish on independent online shops, and we want to help them get as much traffic as possible. There are a number of reasons for this, but it all comes down to, we want to help shoppers support their local communities first, and if that isn't possible, then help them choose where their money goes.

We'd love your feedback. Check us out at https://vendazzo.com/

daniel

They already did that with Canada post shipping. If you buy directly from CP you pay $x. If you buy a CP label from Shopify it costs less than $x because they’re a massive CP customer.

Fun example: there is an issue with Amazon grocery search where it will tell you that they are out of a very common item, such as bananas, but when you check out it will suggest that you add bananas. You can also add the allegedly out of stock items by going to your previous items page. Just bizarre.

And it happens even if there is a good number of relevant products. I've searched for something like "[brandname] 12v fridge" and had a few [brandname] results mixed in amongst countless other random brands. If I'm searching for a specific brandname, that's exactly what I want!

I wonder if this is location dependent... I order way too many things from Amazon, and 90% of the time they deliver on time. I live in a very large city, though, so I wonder if that explains the difference.

This would be way harder than most could imagine. Each of these pieces in aggregate would be interesting but aggregating, expanding, managing each part of the experience would be close to impossible. Kind of like asking what a killer car might be and throwing every feature you can think of into the BOM (like the Simpson's Homer car).

Supply chain, logistics, retail and back office applications of each are very messy. Businesses are messy.

A solution is often just getting rid of the problem. No third party = no problem. The real problem that surfaces then is probably that it's too profitable to throw out and so it becomes something Amazon just chooses to live with as long as it can.

The machines are just doing what they are told. Im no growth hacker, but if I were in this situation, I would be doing the math to see if the cost of slowing down and having a human in the process provides more money in the long run by increased customer satisfaction and return business rather than the current strategy which could be non filtered for all we know, judging by what we see.

There was a sweet spot, in my recent memory, with Amazon years back where I just got the things I ordered, and it took 2 days at most. This was right before the Amazon button things theyd send with your fabric softener where you'd just press the button and more Snuggle would appear.

The first thing, in my case, was being sent the same items twice, one time it was an entire mattress, which was great, but it was a sign. Next came counterfeit items from known reputable sellers, a side effect of product being binned together, as someone explained to me. Buying from the correct amazon store was a crapshoot, because the counterfeits were in the same bin, allegedly. Essentially someone buying the knockoff could have received the genuine item I paid for.

The final straw was in the same week: receiving a completely different order of items than what I ordered, dog food and womens products when I ordered a keyboard, the price of prime going up, and the fact that everything in the catalog was obvious eastern origin products, misspellings, run-on sentence item titles and other hallmarks that Im about to be alibaba'd when the gear arrives.

The headache just wasn't worth it anymore. I never ordered from amazon again. I absolutely have more cost in finding certain items in town, but I feel better knowing there is a person whos face has pointed in the direction of mine while an item was being exchanged for money, hand to hand. There is a trust in that which Amazon is hopeless to ever capture. I hope this catches on.

> It’s extremely difficult to keep high data integrity of the Amazon catalog when all these 3rd parties are contributing information. It gets abused in every possible way.

So you're saying this isn't a technical problem that can be solved by a technical solution?

> It’s all automated

Well I think you found the problem then.

Sears never had this issue because they have humans who do this. They also never had the scale that Amazon has achieved because of those humans.

This is Amazon's blindspot. I'm super bullish on $SHOP because of this.

This is one of those big tech company problems that makes me wonder what I'm missing.

Amazon has money. If they cared about the integrity of their catalog, they'd pay people to maintain it instead of giving control over it to the people who most benefit from it being wrong.

Or just 'vet' sellers, for gosh sakes that's how the whole world operates.

They have to put some effort into deciding who they want to carry and not, it's a very regular part of doing business.

Honest question: why not swiftly ban 3rd party merchants who do anything that is clearly unethical (e.g., changing product listed while keeping reviews from old product, or buying reviewers off to change their review). If it’s an issue of whack-a-mole, ask new 3rd party sellers to post a modest bond. The bond earns interest, and gets returned after N months of good behavior, but gets forfeited if there is a clear ethics violation. Bond amount is proportional to number of items listed, and is set as small as possible to make bad behavior unprofitable.

Also, Amazon customer service continues to be amazing for me. Refund basically anytime for any reason, instantly and fast.

I guess it can’t avoid that trap but time will tell. Funnily a big selling point of Amazon over EBay was SDP. Where as EBay would throw up hundreds of pages for a product Amazon would have just one. Ironically Amazon is now where EBay was 25 years ago. As someone commented above, it’s all circle of life.

Because they have Joe Rogan.

It's a brilliant end run for less powerful entities. For others ... the issue may come home to roost.

That sounds like a wonderful way to shift work to the customer. Holy smokes, does this mean that Amazon has totally given up on actually solving the problem? I'll order direct from the manufacturer long before I start cryptographically verifying all my deliveries.

This is not scalable. You are literally asking thousands of manufacturers to alter their manufacturing process. A much better way is to establish trust certificate. For example, if I want to sell something at Amazon and want to have “Verified” mark, I should submit my identification documents plus documents that establishes my relationship with manufacturers (ex “authorized dealers”). This is already done by many in real world and the question is just to bring it online.

> I'd recommend you checkout Amazon's transparency service:

> https://brandservices.amazon.com/transparency

Huh! This is pretty interesting, and it directly addresses the problem of inventory commingling that we've heard so much about.

The program doesn't seem to be in a very functional state yet, though, and I see a fundamental issue with it.

Products sold on Amazon do not indicate whether they are protected by the transparency program. (I checked for this by searching for the word "transparency" on the Cards Against Humanity product page - Cards Against Humanity is listed on the transparency program page as one of the brands enrolled in the program.[1]) This makes the program nearly useless to the customer. It could still be useful to the manufacturer, though, by preventing customers from receiving counterfeit products.

The fundamental problem is that the counterfeits-on-Amazon problem arose in the first place due to Amazon's method of not caring which individual item came from which vendor. Their system enabled them to not keep track of the provenance of an item. And this new system seems to require them to track genuine items. If they're going to do that, they can already do it entirely on their own end of things.

However, it does look like Amazon sees the transparency program as something to be implemented by manufacturers and not by vendors. On that model, they'd continue commingling everything like usual, and a vendor sending in a counterfeit item wouldn't be able to sell the item at all, as opposed to, say, selling it at a suspiciously low price and having their suspicious item reliably go to the same person who bought at the suspicious price. Amazon already tracks the identity of the item, so validity stamping by the manufacturer would fit into their system fairly seamlessly.

[1] This is itself entirely useless to the customer. No one will ever care if they get a "counterfeit" version of a card game, as long as the content of the cards is the same.

The consumer shouldn't have to parse whether or not their goods are genuine... that's squarely in the wheelhouse of the merchant. This is Amazon's problem to fix, don't you even for a second suggest foisting this onto the consumer.

Or they could stop co-mingling inventory. If I buy from Amazon, I shouldn’t get a product from a marketplace merchant.

Shopify is actually doing that too, they have a fulfillment service/network https://www.shopify.com/fulfillment

It takes several days to drive across the US. You need a logistics network with warehouses spread across the country to service a meaningful portion of the country in 1-2 days.

Small merchants probably don't want to be going to the post office multiple times a day. Even if they were large enough for that to make sense the US is too big for cost effective next day delivery to the entire country, you need to have distribution centers all over.

I assume based on your bio, that your country is the Netherlands? The US is 236x the size of the Netherlands, so you can imagine getting something to a customer in 1-2 days requires a more complex and extensive logistics system.

But to be fair, in your country (looks like NL) the square mileage is 16,040. The US has a sq mileage of the US is 3,797,000.

Here it definitely depends on the types of packages, and my experience is very much in the 1-5 pound range - as you get larger, it's clearly more profitable. Still, however I ran the numbers, I just couldn't see Deliverr taking on my company as a client and not losing money on shipping alone (before factoring in all the overhead). Obviously it'd depend on their mix of business, but overall I just think being a 3PL, unless you have some specialty that allows you to charge a premium, is just a brutal, low-margin, race-to-the-bottom kind of business. I'm glad that Shopify made the acquisition, as having both Deliverr and Amazon MCF run as part of broader ecommerce platforms, as opposed to standalone 3PLs, will be good for ecommerce merchants and customers.

I don't really understand what you mean - it's not like others can just decide to aggressively come after them when it comes to fulfillment. It takes enormous scale to be able to do that. In every part of logistics, Amazon's scale acts as a moat.

then again, if deliveries took 5-7 days instead of 1-2, more people would probably just drive out and buy what they want, which is worse for the environment than one truck making 200 deliveries per day.

Does it, though? The Amazon truck that delivers my packages drives down our street stopping every few houses. Stopping once extra for my house isn't going to add extra fuel usage.

If the truck is full every day, and drives the same route every day, it won't save fuel to batch deliveries.

Cloudflare (or your favorite CDN company) for physical goods. That's neat!

reverse logistics actually can be environmentally positive. Instead of mailing a return back to the headquarters, you drop it off at kohls or cvs and then it gets batched and sent as a palette rather than as loose mail. Pretty cool stuff

I'm in the UK and Amazon has offered this for a while now - they call it Amazon Day. I don't order regularly enough for it to be worth it, but I think the idea is that you order whatever through the week and it's all delivered together on one day each week.

This is cool! I'd never used this despite being an Amazon user for 14 years/however long the Amazon Day has existed.

Lately I've tried to find non-Amazon options to meet my needs, but this'll be great to know for the future :)

Reminds me of conventional vs organic milk. Organic milk was far more expensive and in short supply for so long, related to conversion costs for conventional dairy farms. However once McDonalds switched to organic milk, it became cost effective for most dairies to switch over to organic.

that's $330,000 is now $150,000. What percentage of your portfolio was it? I never really understood what shopify was, it seemed like most of it were drop shippers and people thinking they can make $100 t-shirts.

Especially after Citron Research came out with a damning report on inflation of metrics.

I really don't get all the people cheering on Shopify in the comments for this acquisition when they are missing earnings by a huge margin and faces existential crisis...it's ngmi

I joined and got granted at 1560/share with Staff Dev share counts.

If the comp changes don't really do a lot, I'm out roughly a 6-figure number per year (CAD).

Yes, retailers can purchase software (well, usually rent via SaaS) where they can manage their catalog of inventory, fulfillment, product imagery, etc., all from a single interface.

Indeed. But it also devalued them by $150B in the span of 6 months.

Lets get in touch, if possible? If that is something you'd be open to doing anyways. email is in profile.

Good luck getting through the process. Shopify HR is very slow. It was not pleasant dealing with them. I heard one reason for the slowness is that many HR employees have quit.

Shopify absolutely underpays its tech employees. It's often below market average, but they think the prestige of Shopify is akin to Google, so people will settle for less.

It's known Shopify pays low in the tech industry. Go check levels.fyi

This is interesting. I'll need a few days to try some more searches out. But my initial thoughts is this is presenting unique results.

One query that could use some cleanup is 'router', which is filled with 'Route Package Protection' items. https://vendazzo.com/products?q=router&currency&page=1

But they are talking about Amazon. That is not a small company.