New eCommerce Math: The changing economics of

CSS Commerce' Rob Neumann and Shopware's Jason Nyhus discuss the changing eCommerce economics along with strategies to help manufacturers and distributors manage growth in the eCommerce channel.

Key Takeaways
The e-commerce landscape has shifted dramatically since 2016, with smaller platforms like Shopify gaining market share from enterprise solutions. The biggest change has been in the economics of eCommerce, with platforms increasing fees and leveraging payment processing fees for revenue.

Companies need to carefully evaluate "good costs" that drive growth vs. "bad costs" that create bloat or risk. One big change to note is that open, flexible systems allow merchants to leverage their scale and negotiate better rates as they grow.

Evolution of E-commerce Platforms
Around 2016, major acquisitions (e.g. Salesforce buying Demandware) signaled big software companies entering e-commerce. Smaller platforms like Shopify and BigCommerce, initially seen as niche players, have since gained significant market share. Acquisitions often led to price increases and reduced innovation for acquired platforms. Newer platforms like Shopware represent the latest generation of e-commerce solutions

Changing Economics of E-commerce
Platforms like Shopify initially offered very low fees (0.25%) but have since increased rates and focused on payment processing revenue. Many platforms now use revenue share models, which can be challenging for low-margin businesses.

Rob and Jason discussed how Merchants with $20-25M+ in online revenue have negotiating power and how they should leverage their scale. Open systems, in particular, allow more flexibility in choosing providers vs. being locked into platform-mandated solutions.

Good Costs vs. Bad Costs
Good costs drive growth, increase productivity, or reduce other expenses. Examples include enabling self-service, digital sales rooms, and creator/influencer marketing in the B2B arena.

Bad costs often start as good intentions but create bloat or risk over time.
Some examples are overuse of apps sharing data, uncontrolled AI experimentation, and revenue share models for low-margin businesses.

About CSS Commerce
Based in the USA, we provide Commerce Software Solutions to give distributors and manufacturers a full 360° view of the eCommerce ecosystem. 

By integrating and implementing tools like a Product Information Management System with an ERP system and Advanced Search, we enable distributors and manufacturers' ability to gain ROI while also enhancing the buyer's experience.  We are experts in building eCommerce platforms, connecting all data needs, workflows, approvals, pricing and unique attributes of your particular business.

Open your world to the latest in B2X!


Visit or call us today: www.csscommerce.com
Office: 713-364-2940
Based in Houston, Texas with offices around the world.

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