Shopify vs PayPal

Shopify and PayPal are both industry giants in their respective fields. Both companies are making it big in the present eCommerce marketplace scenario. Both companies have quite different business models in terms of serving their users and also the revenue-generating model.

Shopify sells cloud-based services that enable users to build an online store quickly and sell products and services online. PayPal generates revenues from the commission paid by merchants and consumers to use their financial transaction services.

If you want to know which can be a better option for your online business, then you must check out the Shopify vs PayPal comparison. This will give you more insights into the two business models and also let you find out about the differences. Read on to know about these two online marketplaces and then make the right decision of adopting one or both in your business.

Shopify vs PayPal – Features and Benefits

If you want to choose between Shopify vs PayPal, you must analyze all your business requirements and then decide on the right platform for your business. Read on to know more about Shopify vs PayPal.

Shopify

It is a popular cloud-based e-commerce platform that enables all clients to build online stores easily. Over 800,000 merchants now use Shopify to grow their online businesses. Their revenues increased by 50% every year to $320.5 million in the most recent quarter.

Shopify has grown to be successful as it has kept on finding new areas to extend its business. It started as a solution for small merchants and is recently targeting high-end clients with Shopify Plus, a premium service for big enterprise customers.

Shopify Plus offers 26% of the company’s monthly recurring revenue and opportunities to benefit big companies dealing with direct online sales. They recently announced a fulfillment service that will compete with Amazon’s same type of offering. The offering enhances Shopify’s appeal among merchants who prefer cheaper and faster solutions to ship goods to customers. 

As Shopify focuses on steady growth and gives efforts to grow business into new departments, it is growing steadily and attracting investors’ attention. 

PayPal

PayPal is a famous digital transaction company with a range of apps and services that enable users to purchase things online easily. PayPal’s revenue has increased by 12% every year in the most recent quarter. Before you choose between Shopify vs PayPal, understand your business requirements properly.

It included 9.3 million new active accounts. Non-GAAP earnings grew by 37%. With over 277 million active accounts, PayPal’s prominence in the digital payment world is not going to diminish soon. 

PayPal is not only about online payment services. They are also shifting into modern digital payment markets via its Venmo app. With this app, users can easily transfer their money to each other for everything, from sharing a restaurant bill to paying a servant.

PayPal is also widening Venmo’s reach beyond P2P by enabling merchants to receive it for mobile payments in their online stores. Venmo has over 40 million active accounts. They have processed $21 billion in total payment volume in the most recent quarter, which led to a 73% increase in yearly revenues.

Their popularity in the digital payments marketplace and efforts to extend into P2P payments is commendable.  PayPal keeps on benefiting as the e-commerce marketplace grows.

Shopify vs PayPal – Which is the Best for Your Ecommerce Platform?

Investing in both Shopify and PayPal can be a great investment. Shopify has always been popular, but PayPal is in a better financial state. So, when it comes to Shopify vs PayPal, choose carefully.

PayPal has a steady 12-month free cash flow of approximately $6 billion, while Shopify lags much behind. The former’s price-to-sales ratio is 8.6, while the latter’s is approximately 31. So, if you want to save money, choose PayPal.

With the strong financial metrics of PayPal, its growth over the past years, and expansion in new markets, it can be a lucrative long-term e-commerce payment option for investors. PayPal has proudly garnered a top position in the digital payment world, and adopting such an online marketplace in your business will help you generate revenues and also achieve your business goals.