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At Amazon, almost every internal assignment includes “principles” that serve as guiding principles for the team. This applies to its partnership with Shopify, a company that Amazon considers a major e-commerce rival.
Last week, after a strangely difficult negotiation for Amazon in which Shopify had the upper hand, the two corporations introduced the Buy with Prime app, as Insider reported in the past.
Amazon used six principles to design the partnership with the goal of a “native (i. e. , integrated into Shopify systems) experience so appealing to shoppers that it’s irresponsible for merchants not to offer it,” according to an internal document received via Insider. .
Among the principles are expanding merchants’ sales volume, ensuring Prime delivery, and creating a collaborative environment between the two corporations that can “grow the pie” of the overall e-commerce market.
The document states that Amazon considers Shopify “the largest turnkey ecommerce service provider on the market” and the partnership as a “flagship” purpose for its senior control team.
And it highlights the internal deliberations between the two e-commerce giants. Throughout their discussions, Shopify has exerted an unexpected influence on Amazon. Many facets of the tense negotiations were favorable to Amazon, and the company had to make significant concessions as it sought Shopify’s advantage. cooperation.
Buy with Prime, which was introduced in 2022, will offer merchants a way to offer Prime benefits, such as fast delivery, on sites other than Amazon. com. Online shoppers can simply click on the Buy with Prime tab on the checkout page to use the payment and shipping details already stored in their Amazon accounts. The new app unveiled last week makes it less difficult for merchants using Shopify to install Buy with Prime and offer it as an option to their customers.
Internally called Project Santos, Buy with Prime is the result of a secret initiative led by Amazon founder Jeff Bezos after the company got involved in Shopify’s immediate growth, as previously reported via Insider.
Shopping with Prime caused major tensions between the two companies, and Shopify at one point warned its merchants that they were opposed to it. Some analysts have warned that it could simply be a “Trojan horse” that would help Amazon take a percentage of Shopify by giving it access to a larger merchant market.
For example, Amazon wasn’t very supportive of Shopify handling the back-end payment processing formula for the new app, according to the document. But Shopify managed to close this component of the deal, a huge gain because it’s a primary source of profit for the company.
Even without payment processing, it was still worth securing the partnership through Amazon, as it incentivizes other people to get and keep Prime subscriptions by allowing fast, free checkered shipping with many other websites. In addition, merchants will need to use the FBA program to shop with Prime, where they pay Amazon to buy their products from Amazon warehouses. And Amazon has access to information about the types of parts other people buy from distributors outside of its site.
The six principles sound friendly and cooperative, and they highlight how Amazon manages to turn a rival into a partner. For example, the goal is to create a “better together” experience for all parties, bringing together buyers, merchants, Shopify, and Amazon.
Amazon and Shopify declined to comment, beyond their public statements from the week.
We prioritize paints based on their perspective to increase the merchant’s overall gross product price (GMV). We do this knowing that developing GMV on Shopify through fun reports for merchants and buyers is the most likely way to maintain a healthy business in the long run. Work that won’t increase the GMV directly or isn’t a priority.
The Amazon “main bar” that shoppers expect from Amazon. com is maintained in Shopify. This includes fast and loose shipping, loose returns of eligible items, instant refunds, and Amazon’s A-to-z guarantee. We don’t release products that don’hagan. no meet that bar. If an existing product does not meet this bar, we remove it until the bar is reached.
If the “main bar” is full, we allow Shopify to take over the visitor experience when it can provide a great experience for the merchant and/or visitor. Examples include Shopify providing a greater food shopping experience through the checkout process. and a greater trading experience by being a central hub for merchants to manage their businesses.
Mercantile knowledge belongs to traders. Knowledge of BwP transactions is 1P [own] to merchants, implying that it is merchant selection, Shopify, that is provided to Amazon.
We think decentralized but act centrally. Each Santos team has a unique set of goals and perspectives. Our goal is to empower those groups to own and deliver their roadmaps, but when products feature BwP or are key innovations for BwP, we centralize prioritization, communication. and raising the bar toward a voice consistent with Shopify.
Take advantage of the key differentiators that each and every business must offer. We can create a “better food shopping and a better shopping experience together” with Shopify. We leverage the key differentiators that each and every business should offer (e. g. Prime, MCF, Amazon App, Shop App) to “make the pie bigger”.
Do you paint on Amazon? Do you have any advice?
Contact journalist Eugene Kim via encrypted messaging apps Signal or Telegram (1-650-942-3061) or email (ekim@insider. com). Contact us through a non-professional device. Check out the Insider Sources Consultant for more tips on how to share data securely.