Tobias and Scott had no idea what they were about to create when they pivoted from a store selling snowboards to helping other eCom businesses sell more in 2004.
Shopify now generates $20m MRR and hosts stores for Google and Tesla:
How?
This posts explains…
Risk reversal:
The more you can reverse risk at a conversion point, the more your conversion rate will increase.
Commitment consistency bias:
The more something does something, the more likely they are to keep doing the thing.
Shopify combines these two principles beautifully in their 14-day free trial:
And here we are: https://accounts.shopify.com/store-login
OK, it doesn’t look great, but that felt really good.
I went from entering my email address to have a live, buyable store in precisely 47 seconds whilst spending $0.
I feel productive.
But the magic starts now…
Over the next 14 days, I’m probably going to:
– Open my store
– Write an edgy About Us page
– Buy a domain
– Customize my theme
– Organize my products
– Run some video ads
– Maybe even sell something
If I do… my conversion rate to paid is going to be close to 100%.
I have actually accomplished something during these two weeks, my dream is coming alive, am I going to close up shop?
They then start gathering all the data around your eCom business (Salesforce do this with bigger businesses and Apple do this with your phone). And then start letting developers access the data to build their own app…
Building a moat, adding massive value to the ecosystem and generating large amounts of cash through their App Marketplace.
But that’s for another post.
AHHHH I LOVE SHOPIFY
What do we learn from this?
1. How can you reverse risk at your core conversion point?
2. How can you then get your users/customers to invest their time/effort into your product?