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TL;DR
Watson Weekend on Shopify: Shopify has promised for years that it won’t compete with its own merchants. Shop.com makes that promise harder to keep.
The News You Did Not Know You Needed: Walmart’s new membership bundle costs less than Prime or a Costco Executive card, and it includes both a warehouse club and home delivery.
Weekend Reading: Less candy at Halloween? and trading cards stolen
THE WATSON WEEKEND
Shopify Might End Up as Just the Checkout Button
Shopify now owns shop.com. It bought the domain from Market America and hasn’t said what it paid. Shopify has spent years putting the word Shop on its app and its checkout button, so the .com was the obvious missing piece, and it was never going to be cheap.
I’ve heard nine-figure guesses, and nobody has confirmed any of them. The number we do have is $375K, which is what Shopify paid for shop.ca and shop.us last year. Generic domains can go much higher than that, and cars.com was once valued at $872 million.
Shopify says the new domain makes Shop easier to use on the web. Right now most people, me and Jess included, open the Shop app to see when a package will turn up. Shop Cash tends to expire before I remember I have any. Shopify has also always said it won’t compete with its merchants. A shopping destination at shop.com, where every AI agent will find it, moves closer to that line than anything it has done before.
The bet I care about is checkout. If agents do the browsing, the storefront matters less and the payment step matters more, and Shop Pay already sits at that step for a lot of shoppers. In one version of the future, Shopify is mostly a purple button at the bottom of the page. That’s a better business than it sounds, because owning checkout captures most of the value without the cost of fighting over everything above it. Jess thinks Shopify sees PayPal as weak and wants its share, and I suspect that’s most of the motive.
Inside the company, efficiency is Tobi Lütke’s favorite word. Every few months teams get measured on whether they have the right number of people, and coming out heavy is bad news for whoever is on that team. Revenue per employee bounced along for years and then climbed fast after 2023, and Wall Street has rewarded it.
It reminds me of Amazon’s old order of priorities, with customers first, sellers sometimes and employees last, except Shopify puts merchants on top. Tobi was early in telling staff to use AI and has since sounded more cautious, because the same tools make it easy to produce a long deck that says nothing. People have started calling those slop grenades, and Jess has sat through her share.
What I can’t square is the efficiency push next to the size of the bets. Harley Finkelstein wants Shopify to own agentic commerce, and bets like that usually need slack, meaning people with time to try things that may not work. Jess quoted someone on the show who said efficiency is where innovation goes to die. I haven’t decided how much I agree.
If agents start bringing buyers to Shopify merchants, Shopify collects at checkout either way. I still haven’t heard Shopify explain how the merchants come out ahead, and the enterprise brands it’s courting will be asking the same thing.
LISTEN TO THE LATEST WATSON WEEKEND EPISODE
THE NEWS YOU DID NOT KNOW YOU NEEDED
Walmart’s $120 Bundle Goes After Prime and Costco Members
Walmart now sells Walmart+ and Sam’s Club Plus together for $120 a year. The offer started October 20, and Walmart says it saves members almost $100 compared with buying both separately.
Existing Walmart+ annual members can add Sam’s Club Plus for $22 more a year. Basic Club members pay $60 more to move up to Plus and get Walmart+ with it, while current Plus members get Walmart+ at no extra cost. The cheapest route into a Sam’s Club Plus membership now runs through Walmart+, which tells you Walmart wants more of its delivery customers shopping in the clubs.
The press release compares the bundle to $139 for a retail membership with delivery and $130 for a warehouse club. It doesn’t name either company, but those prices match Prime and Costco’s Executive tier.
Walmart says the cost won’t materially change its fiscal Q3 or full-year guidance from August 20.
U.S. field associates at Walmart and Sam’s Club will get both memberships as a benefit.
Fee income carries very high margins in club retail, and Walmart is giving some of it up to win more of the weekly shop. I’d want to see renewal rates and how many Plus members actually start using Walmart+ delivery before calling this a good trade.
WEEKEND READING
Retail Dive: Halloween spending could be down, does that mean less candy?
NBC News: Sports trading cards and Pokemon cards worth nearly $1M was stolen this week. New target for crime?
FRIENDS OF WATSON
Private Dinner in LA
Date & Time: Wednesday, October 28 | 6 to 9 PM
Location: Élephante, Santa Monica (private Cactus Garden room)
Hosts: Opensend + InterMedia
Description: It's a small group of ecommerce and brand leaders in a private garden room with its own fireplace and bar, with Spark Group and Felina already joining. Lots of time for good food and real conversation.
