Magento users: Is it time to upgrade—or switch?

By Sameer Shah

Based on the number of merchants using it, Magento Version 1  is one of the most popular and widely used ecommerce platforms on the market. Its Community Edition is free of licensing fees, and it offers a wide variety of features ranging from large catalogs and product capabilities to advanced pricing options.

Unfortunately, however, Magento plans to discontinue its support for both Magento Commerce 1 (aka Enterprise Edition) and Magento Open Source 1 (aka Community Edition), leaving legacy users with a difficult choice: Upgrade to Magento 2 or switch to another platform. Based on our experience and focus on revenue generation through ecommerce, Khaana believes the best option is to switch to either BigCommerce or Shopify. Here’s why.

Sales, sales, sales

First and foremost, ecommerce is about creating a profitable business. The easiest way to drive new customers to your site and generate sales is to run advertising funnels on social media platforms like Facebook and Instagram. Doing so requires a tight integration between the ecommerce catalog and the social media platform. In our experience, this connection is very weak on the Magento platform.

A practical example illustrates this problem: We recently tried to run dynamic Facebook ads for a Magento client. Dynamic ads are powerful because they serve images based on what Facebook thinks a particular user will like. The ads failed to work because the Magento catalog couldn’t sync properly with Facebook, and as a result, the client failed to generate sales during an important holiday period. To make matters worse, the pages were slow to load, which also hindered sales.

Magento 1 also lacks basic features, such as a native abandoned cart saver. This functionality helps you capture sales from users who have added items to their cart but have not made a purchase through an email or text notification nudging them to complete the order. Generally speaking, abandoned carts are the easiest sales in ecommerce, and platforms like Shopify and BigCommerce make this very easy.

Lastly, both BigCommerce and Shopify have more ready-to-use site themes, meaning a richer customer experience at lower cost. Magento sites require a greater degree of custom development to achieve the same results.

Ease and cost of maintenance

A number of factors make Magento a more complex and expensive platform to maintain, including:

• Hosting: Magento requires the merchant to host its platform while BigCommerce and Shopify are SaaS (software as a service) offerings, meaning they host your merchant website for you. Hosting yourself requires finding the right partner, paying their fees, and managing that partner relationship. The merchant is also ultimately responsible for making sure that platform updates are made in a timely manner. If for some reason the site goes down, it’s up to the merchant and its IT provider to fix the issue. BigCommerce and Shopify handle hosting and make sure the site is always up. Magento does offer a cloud-based (SaaS) version that offers features similar to Shopify and BigCommerce, but its pricing is much higher. Both BigCommerce and Shopify’s base plans start at $29.99/month, while the cost of a Magento Enterprise Cloud site begins around $1,667/month (20,000/year).
• Site management: Because Magento Community Edition (1 and 2) is an open-source platform, it requires significant developer involvement to maintain the code, make updates, ensure security, and make any needed updates. SaaS platforms (Shopify and BigCommerce) manage all of that for you so your store is always selling. (A note about upgrading to Magento 2: If a merchant chooses to upgrade to the newer version of Magento, that shift will require a change to a new architecture and database structure, which equates to significant cost. Switching to BigCommerce or Shopify is likely far cheaper.)
• Payment processing and shipping costs: Magento does not have its own payment processing capability. This means the merchant has to select, implement, and manage its chosen payment gateway. Shopify offers the choice of using its payment gateway or third-party options (although there is a surcharge to using a third party). BigCommerce offers pre-integration with 65 gateways, including popular names like Stripe, Square, PayPal, Apple Pay, and Amazon Pay. When it comes to shipping, Shopify in particular aggregates the volume running through its platform to offer reduced-price shipping. One of our clients was able to cut shipping by almost half through the United States Postal Service just by switching from Magento to Shopify.

Security considerations

Magento’s approach to securing customer’s credit card data creates risk and cost for the merchant. Magento is not compliant with the Personal Payment Card Industry Data Security Standard (PCI DSS), which is a required security standard for companies and organizations that process credit and debit card transactions. Adherence to this standard reduces the risk of fraud and other malfeasance, and it is required to process transactions on Visa, Mastercard, American Express, and Discover cards.

Unfortunately Magento puts the burden of PCI compliance on the merchant, while Shopify and BigCommerce ensure the deepest level of compliance out of the box. This means you are compliant from the day you launch your store and you don’t have to worry about the risk or cost of maintaining this critical aspect of your ecommerce business.

The bottom line

We strongly recommend Magento users consider upgrading to Shopify or BigCommerce. This need is especially important for users facing the end of Magento’s support for its Version 1 platforms.

Switching platforms may be cheaper than upgrading to Magento Version 2, and more importantly, doing so will create a much more successful ecommerce business. A more modern platform will ensure a much better user experience and deeper integrations with selling tools, all resulting in higher sales.

Have questions? Not sure about your next move? Email us at info@khaanamarketing.com and we can help you figure out the best path forward.