Product Lessons From An Unpopular Shopify Launch

In case you missed it, Shopify launched a massive feature this week. In one night they transformed their already popular (16,000,000 users) shipment status app “Arrive”, into a marketplace app called “Shop”. This app will eventually be a direct competitor to Amazon and Walmart, with the goal of being a marketplace where consumers can discover, follow and buy from merchants on the Shopify platform.

This is a massive move. As of Q4 2019, Shopify reported over 1,000,000 merchants and this number is pre-covid. If the recent indicators are true, Shopify will end up showing huge merchant growth numbers as they help bring offline SMBs, online.

These numbers don’t lie, Shopify has nailed getting merchants onto the platform. Their next logical step was to help with discovery and B2C. So for this reason, the marketplace wasn’t a huge surprise. Even prophetic me had speculated months ago that this was happening.

Lackluster Launch

For me, the more interesting angle of this launch was looking at what wasn’t released.

Let’s be real, it was pretty lackluster. They rebranded a mobile app, added the ability to follow brands and that’s really about it. The shipment tracking was already there and if you want to buy from a store, it takes you to an in app browser.

I can only speculate, but I have to imagine that a company of their size did not originally plan to release something as big as a marketplace with this ordinary of a feature set. It’s likely that Covid gave them an opportunity to cut down on the features, release what is ready and try to help their merchants by releasing Shop early.

And I’m not the only one who felt this way. Majority of the takes were quite critical. This was a release that had the potential to make a much bigger splash.

While the strategy is interesting, it’s all a guess because we don’t know what Tobi and the team were thinking. What we do know is that a massive company decided to ship a lackluster product and they were OK with it. This is what I want to discuss.

Strategizing The Launch

I recently wrote a post about how to prioritize MVP features which ties in nicely with this Shopify launch.

Incase you haven’t read the post, I discussed the concept of paring down a launch feature set in an effort to save time. Naturally, this is a contentious topic and it’s one that my co-founder and I debate frequently. I want to cut out features, he wants to delay a launch to build them.

The reality is it’s a hard problem to solve. This is for two reasons:

1. It’s impossible to please everyone, so you need to be hyper specific about who you are building/launching for.
2. Once you do figure out the who, then you need to impersonate them and qualify the value you bringing (make sure it’s enough).

Let’s try to use these to analyze the Shop launch. Who were they targeting and was it enough? Clearly, the Shopify execs felt it was or else they wouldn’t have launched something after sitting in R&D for a year. We’re not going to debate that. Instead, we’re going to pretend that we’re the Shopify execs assessing the launch using the strategy above in an effort to apply it to our own products.

Step 1: Who was the Shop launch for?

Big picture, this is a B2C marketplace, an entry point for consumers to tap into the Shopify network of merchants. So, the focus here is on the consumer, with some indirect value for the merchant (we’ll assess that side later).

This is a huge market to launch to and personally I would simplify it by just focusing on the 16 million users that had the Arrive app installed. You know more about these users as they have already interacted with a Shopify merchant. By focusing on them, we can attempt to add value to a user group that we have data on. When you are focusing on your own launch, try to hone in on a more specific user group. The broader you go, the harder it will be to generate value.

Step 2: Now that we know who we are launching for, let’s assess the value

Consumer Value:

• Allow 16 million users to repurchase from brands they’ve already bought from
• Give consumers a way to discover and support local brands
• Real time tracking of shipments

Obviously, this is not an overwhelming amount of value, but I do think it’s something, and the ease around repurchase is nice.

But if we bring back the merchant component which is valid because it’s a marketplace, I think we’ll start to build a better case for launching.

Merchant value:

• Increase LTV of customers with ability to repurchase
• Lower CAC by giving consumers a discovery option
• Help local merchants sell in a time when they are hurting

The above is strong and arguably more valuable than the consumer side. You need to remember that Shopify’s priority is the merchants. Focusing on the merchant has gotten them to where they are today.

Bonus Shopify Value

• Shopify gets to release their consumer product and new brand in a time when helping merchants is beneficial
• They get to launch a foundational product that they can now build on quickly
• The news cycle is in Shopify’s favor. A lacking tech release is not going to stay at the top for long when there is more important news to cover, like a pandemic.

The Lessons

Going through this exercise with the Shop example is interesting. It’s not a perfect comparison but there are definitely nuggets of value.

You will not please everyone

This is true of everything, but important to remember for product development. And also the strategy behind niche products, the smaller the focus the easier it is to bring value.

Be honest with yourself about who you are targeting. Generate value for that subset and any feedback you get for users that fall out of that focus are just bonus points.

Assess value holistically

While important to make sure that you are adding value for a specific group of users, I wouldn’t discount looking at the big picture. Take the Shop example, which on the surface looked like a botched B2C launch. There are so many intangible pieces of that launch that are valuable. From launching a new brand, to getting feedback and setting the foundation for future iterations.

This reminds me of launching refactored/rewritten code. The end user has no idea that you made those changes under the hood, but good refactors set you up for faster dev and more success down the line. Completely intangible, but incredibly valuable.

You’re probably overthinking it

It’s a good reminder to see a massive brand like Shopify, release something that missed expectations. It’s ok to launch too early, your business will not go up in flames. Yes, you may upset some users, you may even lose some, but you will learn a lot. This is especially important for small companies that can be more personable and apologize for misses. Learning is so much more important than pleasing everyone.

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