{"id":347682,"date":"2025-12-17T03:42:10","date_gmt":"2025-12-17T03:42:10","guid":{"rendered":"https:\/\/peraltafinancing.com\/analytics\/kevin-hillstrom-minethatdata-speaking-of-losing-not-understanding-shopify\/"},"modified":"2025-12-17T03:42:10","modified_gmt":"2025-12-17T03:42:10","slug":"kevin-hillstrom-minethatdata-speaking-of-losing-not-understanding-shopify","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=347682","title":{"rendered":"Kevin Hillstrom: MineThatData: Speaking of Losing: Not Understanding Shopify"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"post-body-6222448448300029658\" itemprop=\"description articleBody\">\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">History is littered with the concept of marketplaces.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">&#8220;Shared money&#8221;.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">The entire purpose of a marketplace is to capitalize on shared money, to a point where more money comes in then goes out.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">Cities performed this function in the old days. Think about &#8220;downtown&#8221; &#8230; shared money as rural people came into the city and spent money &#8230; more money going in than going out. This model was eventually blown up by interstate highways, which pulled retail out of downtown to the interchange. Downtowns died, eventually being repurposed.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">Pre-internet, you had direct-to-consumer brands leveraging the marketplaces of their day &#8230; lists and co-ops. Catalogers were nothing more than participants in a large marketplace that had more money coming in than going out. Ecommerce ended their marketplace.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">Ecommerce was nothing more than a large marketplace fueled by an opaque network of shady digital advertisers using Google\/Facebook\/Display Ads as the hub of their activities. This worked well, because more money came into the system than went out of the system &#8230; money was reallocated from suburban malls into the opaque digital advertising system. Of course, Amazon harmed this marketplace with their own marketplace.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">Amazon is a gigantic marketplace fueled by algorithms. This worked well, because more money came into the system than went out of the system &#8230; why wander in the Google\/Facebook wilderness when Amazon self-contained the entire shopping experience? Of course, Amazon is now being harmed by the latest flavor of marketplace &#8230; Shopify.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">The Lemonhead will scream &#8220;AMAZON IS NOT BEING HARMED!!&#8221;. The Lemonhead always defends the &#8220;old&#8221; business model (they&#8217;re still defending department stores &#8230; self-contained marketplaces from the pre-internet days). For a period of time, Shopify will have a money advantage (which is the secret of a marketplace), because more money will go into their world than will flow out of their world. This doesn&#8217;t mean that Shopify will &#8220;win&#8221; &#8230; but somebody doing what Shopify is trying to do (marketplaces fueled by AI) will create something interesting &#8230; they will find a solution where they bring in more money than goes out of their ecosystem (likely at the expense of Amazon, Google &amp; Facebook).<\/span><\/p>\n<ul>\n<li><span style=\"font-family: arial;\">Aside:\u00a0 <i><span style=\"color: #b45f06;\">The entire brief history of social media is more traffic coming in than going out, the subsequent process of losing traffic happens much faster in social than in retail and\/or ecommerce &#8230; providing great case studies of when &#8220;tipping points&#8221; happen.<\/span><\/i><\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">On the surface, Shopify is a self-contained world for a small-to-medium sized ecommerce brand to sell stuff. Under the covers, Shopify (or somebody who will do Shopify better than Shopify) is a modern marketplace seeking to bring in more money to the ecosystem than leaves the ecosystem.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial;\">Losing companies tend to over-focus on two ends of the spectrum &#8230; on the 30,000 foot view of commerce (will ChatGPT supplant Google) or the 3 foot view of commerce (can Buy Now Pay Later grow sales for us). Both are important. Between 3 feet and 30,000 feet is where the Lemonhead does not understanding the Shopify effect on ecommerce &#8230; the goal of every company is to bring more money into their ecosystem than goes out of their ecosystem. Which means, of course, if you are a $70,000,000 ecommerce brand, you have to figure out how to use all of these &#8220;ecosystems&#8221; to your advantage so you have more money coming in than going out.<\/span><\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>History is littered with the concept of marketplaces.\u00a0 &#8220;Shared money&#8221;. The entire purpose of a marketplace is to capitalize on shared money, to a point where more money comes in then goes out. Cities performed this function in the old days. Think about &#8220;downtown&#8221; &#8230; shared money as rural people came into the city and [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12033],"tags":[13773,13772,3911,13774,16639,13186,5715],"dealstore":[],"offerexpiration":[],"class_list":["post-347682","post","type-post","status-publish","format-standard","hentry","category-analytics","tag-hillstrom","tag-kevin","tag-losing","tag-minethatdata","tag-shopify","tag-speaking","tag-understanding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Kevin Hillstrom: MineThatData: Speaking of Losing: Not Understanding Shopify - Som2ny Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fivemor.com\/?p=347682\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Kevin Hillstrom: MineThatData: Speaking of Losing: Not Understanding Shopify - Som2ny Network\" \/>\n<meta property=\"og:description\" content=\"History is littered with the concept of marketplaces.\u00a0 &#8220;Shared money&#8221;. 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