If you’ve been on the Internet in the mid-1990s, you will vividly remember the promise of the Internet becoming a place where we buy EVERYTHING. Fast forward to 2025, and you can easily find things accessible exclusively online.
The world of online shopping is constantly changing. More and more businesses are setting up shop online, and people are increasingly buying things with a few clicks. It’s important to understand how this market works, especially when it comes to big platforms like Shopify and Amazon. This article will look at how Shopify has grown and the challenges that come with dominant players like Amazon, focusing on how sellers can price their goods fairly, how much choice consumers really have, and some ethical considerations.
Shopify’s Growing Presence in E-commerce
Shopify, which started in 2006, has become a major player in e-commerce, helping over 2 million sellers set up their online stores. The company has seen impressive growth, handling $235.91 billion in sales in 2023 and bringing in $7.06 billion in revenue that same year. A big part of this growth is that 675 million buyers purchased from Shopify merchants in 2023, which is more than double the number since 2019.
Shopify is popular because it provides easy-to-use tools for businesses of all sizes to get online. There are currently 4.61 million live websites using Shopify, with most of them (57.69%) in the United States, followed by the UK and Australia. They even have a special plan for bigger businesses, Shopify Plus, which is used by 50,556 live websites. By December 2021, Shopify had 2.06 million merchants, and now they just say “millions of merchants” use the platform.
However, with such rapid growth, some issues have come up for Shopify. One recent concern involves certain merchandise sold on the platform. Shopify has defended its clients’ right to sell antisemitic and Holocaust-denying items, including parodies of Anne Frank. This brings up important questions about what e-commerce platforms should allow and how it affects consumers who want to make ethical choices. It’s especially tricky when such sales might go against laws, like Canada outlawing Holocaust denial in 2022.
Another point of contention for Shopify, particularly in Europe, revolves around data transfers. German data protection authorities have looked into how Shopify and its services, like Cloudflare, transfer customer IP addresses to the US. This is an issue because of the US Cloud Act, which allows US authorities to access data even if it’s stored on servers in the EU. While an IP address is considered personal data under European law, it’s not deemed highly sensitive. The German authorities suggest that transfers of more sensitive information, like login details, remain problematic as long as the US Cloud Act is active. The EU-US DPF might offer sellers and buyers some comfort, but its shoddy foundation does not inspire confidence.
To future-proof your online presence within the world’s biggest single market, you should consider staying away from Shopify.
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Amazon’s Market Dominance and Its Problems
While Shopify helps many individual sellers, Amazon’s massive size and market share create a different set of challenges. In Germany, for example, Amazon’s platform (amazon.de) handles about 60% of all online retail sales. This huge presence gives Amazon a lot of power to influence competition and shape the overall e-commerce market.
One major concern is how Amazon controls the prices set by sellers on its Marketplace. Germany’s competition authority, the Bundeskartellamt, is worried about Amazon’s “price control mechanisms.” These mechanisms can lead to products being removed or hidden from prominent spots, like the “Buy Box,” if Amazon decides the prices are too high or not competitive enough. The Bundeskartellamt believes this practice might be illegal under German and EU competition laws because it stops sellers from setting their own prices freely. It can even make it impossible for sellers to cover their costs, potentially forcing them off the platform. Essentially, there’s a concern that Amazon is using its power to make Marketplace prices match its own pricing ideas, which could harm competition and limit what consumers can choose from.
Beyond pricing, Amazon has been heavily criticized for the large number of fake and counterfeit products sold on its platform. Most listings on Amazon come from third-party sellers, and unfortunately, many of these are selling fakes. Investigations have found that Amazon has listed “thousands of banned, unsafe, or mislabeled products,” including dangerous kids’ items and electronics with fake certifications. There have even been cases where expired food, including baby formula, was shipped to customers. Because of all the fakes and Amazon’s apparent lack of action to stop them, well-known brands like Birkenstock and Nike have stopped selling on Amazon.
A report from the Department of Homeland Security in January 2020 stated that “many consumers are unaware of the significant probabilities they face of being defrauded by counterfeiters when they shop on e-commerce platforms,” and that these chances are “unacceptably high and appear to be rising.” Fake products aren’t just a rip-off; they can be dangerous. There have been reports of fake chargers causing electrocutions and phony cosmetics leading to severe reactions. It’s even harder to deal with this problem because sellers who are caught selling fakes can often just set up shop again under a different name.
Amazon says it’s fighting counterfeits with programs like Brand Registry and Project Zero. While these efforts are a step in the right direction, critics argue they aren’t enough. Manufacturers are also hesitant to fully participate in these programs because it makes them more dependent on Amazon and requires them to share more of their sales data.
The “Race to the Bottom” and Its Impact on Society
Amazon’s business model, particularly its reliance on third-party sellers and its system that often promotes the lowest price, can create a “race to the bottom.” This means that legitimate sellers find it hard to compete with counterfeiters who can offer products much cheaper because they don’t have the costs of developing and ensuring quality for their goods. This kind of environment can stifle new ideas and discourage ethical business practices.
The effects go beyond just individual sellers and buyers. When a platform primarily focuses on the lowest prices, it can limit consumer choice, as smaller, higher-quality brands might struggle to survive or decide to leave the platform. This also encourages a cycle of buying cheaper, often lower-quality goods that are easily replaced, rather than investing in durable, ethically made products, which can have negative environmental consequences.
And it is gone
The e-commerce world is complex. While platforms like Shopify help many small businesses thrive, and giants like Amazon offer convenience, there are also significant issues. Shopify has faced questions about what content is allowed and how data is handled, while Amazon’s dominance raises concerns about fair competition, the spread of fake products, and the broader impact on ethical consumerism and market diversity.
As it stands today, both platforms experience growth while eroding privacy, safety, environment and choice. Will the trend continue?
- https://engity.com/blog/data-protection/shopify-case-eu-us-data-transfers-under-scrutiny/
- https://backlinko.com/shopify-stores](https://backlinko.com/shopify-stores)
- https://www.nytimes.com/wirecutter/blog/amazon-counterfeit-fake-products/
- https://www.bundeskartellamt.de/SharedDocs/Meldung/EN/Pressemitteilungen/2025/2025_06_02_Amazon.html
- https://www.yahoo.com/news/indiana-pacers-step-local-mom-121500417.html
Jarek Rozanski is the Founder of Wide Angle Analytics. After a successful career in investment banking and financial services, he decided to explore the world of start-ups and eventually start his own. Privacy, one of our basic human rights, needs strong protection according to Jarek
