Forget Amazon! Shopify Just Became The Better Bet For Sellers Transcript, AI Summary & Key Points

00:00 So, Amazon made a decision last year that I believe will go down as one of the worst strategic calls in e-commerce history. It's affecting almost every major seller on the platform. And when you learn what they did, you'll understand why 84,000 sellers already quit Amazon in the last 14 months alone. Now, what makes this really interesting is that another platform did the exact opposite of what Amazon did.

00:21 and they just posted a quarter with numbers so lopsided that the sellers in my e-commerce community are all making the same move right now. Now, I still sell on Amazon and it's a small percentage of my revenue at this point. But what happened this year has convinced me the smart play for any serious seller is to build somewhere else. And I'm going to walk you through why.

00:41 So, let me start with what happened first because most sellers haven't fully connected the dots yet. In 2026, Amazon added almost every major AI platform to its block list. Google's AI crawlers, ChachiPT, Perplexity, Claude, Meta, Huawei, Mistrol. If it's a bigname AI LLM, it can no longer read Amazon's product listings. Amazon even sued Perplexity to stop its shopping agent from operating on the site.

01:06 Now, Amazon's bet here is that shoppers will all start their product search on Amazon. So, blocking outside AIS from reading their listings forces people into Amazon's own walled garden and Amazon's own AI shopping assistant. That's their entire strategy. Now, the problem with that strategy is that it's based on a version of the world that no longer exists.

01:26 Only 10% of 16 to 24 year olds now start their product search on Amazon. 56% of them start on Google, YouTube, or Gemini instead. Amazon's own share of Gen Z shoppers who visit first when they know what they want to buy fell from 40% to 34% in just one year. And 47% of Gen Z say they're actively trying to shop less on Amazon. Now, where are they going instead?

01:52 Well, 66% of 18 to 24 year olds now use Chat PT to find information. And 53% of genzers now prefer Tik Tok, Reddit or ChatPT for search. Which means that Amazon is walling itself off from the exact platforms where the next generation of shoppers is starting their product search. So if you're only relying on Amazon, you are shooting yourself in the foot because all the other AI platforms are gaining traction month over month and Amazon is functionally invisible on every single one of them.

02:22 That is the decision I think is going to hurt Amazon going forward. And then in August of this year, Amazon did something else that hurt sellers directly. They killed the field that let FBM sellers add custom return instructions. Things like, "Please return an original packaging with all the accessories are now gone." Amazon also removed buyer seller messaging during returns entirely and then forced everyone to use Amazon's prepaid return labels regardless of price.

02:50 Now, we get junk returns all the time on Amazon. Sometimes it's not even our own merchandise. And now we have zero control over any of it. This is going to be catastrophic for anyone selling apparel or anything with a high return rate because Amazon just shifted the entire return cost onto the sellers with no way to fight back. Now the third thing Amazon did in the past year is a huge tell about what's really going on inside the company.

03:14 They launched a program called Amazon Shop Direct. When a shopper searches on Amazon, they may now see results from other retailers sites with a button that takes them to the merchants's website. Amazon's own AI can even complete the purchase for them on the merchant site. Now, as of March of this year, that program includes over 100 million products for more than 400,000 sellers, which means that Amazon is conceding that some shopping should happen off of Amazon.

03:42 They'd rather be the search engine that takes a cut than lose the search intent entirely. So even Amazon knows the future e-commerce discovery isn't that everything happens on Amazon. And on top of all that, the squeeze on sellers is suffocating. Fees went up in January. Amazon added a 3.5% sir charge on top of the fee hikes in April. Amazon PPC costs are up 8 to 12% year-over-year.

04:07 And it's all obfiscated on purpose. You have to look through a whole bunch of different reports to figure out what's actually happening to your bottom line or sign up for an Amazon accounting app just to understand your own P&L. The Amazon search page is also a disaster because it's all ads now. That is their primary growth lever. They don't want to be an e-commerce platform anymore.

04:28 They want to be an ad platform. And the seller numbers tell the entire story. In 2025, only 165,000 new sellers launched their first listing on Amazon.com, which is down 44% from the year before. And in fact, it is the lowest number since 2015. And the active seller count fell from 584,000 in January of 2025 to 500,000 by March of 2026. That is 84,000 sellers gone in about 14 months.

04:57 At my annual e-commerce conference of seller summit this year, the hallway conversation I kept having was people quitting Amazon and looking for something else because everything has to line up perfectly on Amazon now. If anything bad happens, you can be in real trouble with your cash flow. So, bottom line, Amazon blocked AI while an entire generation of shoppers moved to AI.

05:19 They gutted seller control and returns, quietly routed traffic to competitors, squeezed margins, and 84,000 sellers already voted with their feet. Now, where did they go? For most of the sellers I know personally, the answer is one platform, Shopify. And here are the two main reasons why. By the way, if you're interested in learning how to create your own profitable Shopify store, make sure you sign up for my free 6-day e-commerce miniourse below.

05:43 100% free and I guarantee you'll learn a ton. Now, I want to be upfront about something before I keep going. I don't actually run Shopify for my own store. I built my own shopping platform and I maintain it with AI, but I'm watching what Shopify is doing right now with more interest than at any point in the last 10 years. And for anyone starting out or anyone still Amazon only, this is where the momentum is.

06:07 And here's why. In Q2 of this year, Shopify reported that AI referred traffic and orders both tripled year-over-year. Not only that, but AI referred shoppers convert at nearly 50% higher rates than traditional traffic. Half of those AI referred sessions land directly on a product page, which is 2 and a half times the rate of traditional search. Shopify posted $3.6 billion in Q2 revenue up 34% year-over-year with gross merchandise value up 32% to 116 billion.

06:38 Now, here's why this matters. ChachiBT, Perplexi, Gemini, Copilot, Claude, and Grock are the fastest growing acquisition channels in e-commerce right now. Shopify storefront are readable by all of them, and Amazon's are not. Which means that every AIdriven purchase in your category is a coin flip that lands on Shopify. And Amazon isn't even in the game.

06:59 Let me show you what this looks like with my own store. Check this out. on every major AI platform right now. If you type in what is the best place to buy wedding handkerchiefs, we come up number one. And we aren't paying any money for this. The AI is telling the shopper and we are the answer. Now, here's what I actually did to get there because it's not magic and it's a playbook that any of you can run.

07:22 In November of last year, I ran a content and FAQ schema audit across 26 of my category pages. I looked at the questions shoppers were actually asking in AI answers for my category and I made sure my pages answered those exact questions in plain English with FAQ schema wrapped around them so the AI could find and site them cleanly. 9 months later, I pulled the search console data and compared the before and after.

07:47 22 of those 26 pages improved their ranking position and that is an 85% hit rate on a really simple content playbook. And the one page that made the whole exercise worth doing was my bridal handkerchiefs category. Before the work, that page was sitting at position seven in Google. Nine months later, it was at position four and pulling in five times the traffic.

08:08 And all I did was structure the content differently with better schema. And that same page is the one AI answers site when someone asks where to buy wedding handkerchiefs. Now, I want to be straight with you about what didn't work either. Not every page paid off in traffic even when the rankings went up. My napkin category pages moved from position 30 up to 12 and the rankings improved but the clicks did not because position 12 is still below where people click.

08:34 But if you're in a category with real search volume and you do the content work right now, you will start ranking in AI search. AI referral traffic on my store is still a singledigit percentage of overall sales, but it's been growing exponentially over the last 6 months. mainly chatbt and Google and that channel did not exist two years ago. Now I belong in several e-commerce communities and here's the big mistake I'm seeing sellers make.

09:00 They are waiting for AI shopping to mature before they set up their own store. But by the time it is obvious to everyone the AI models will already be citing the sites that were there first. So every month you wait, you're falling further behind. But AI traffic is only the first reason sellers are moving to Shopify. The second one is a customer acquisition channel Shopify built that most people aren't using enough, which is the Shop app.

09:24 Now, the Shop app is Shopify's own shopping app. Kind of like their answer to the Amazon app. Customers download it, get one login, one universal checkout, a feed of product from every Shopify store, any place to track every Shopify order they've ever placed. And it now has tens of millions of active shoppers using it. Now, here's where their strategy is brilliant.

09:46 Every time someone buys from any Shopify store, they get prompted to download the shop app to track their order. There's order confirmation, shipping confirmation, the order status page. Everyone gets three separate app installed prompts per purchase. And then once the app is installed, they can connect to the customer's Gmail or Outlook and start tracking every other online order they've ever placed automatically.

10:09 So, the Shop app becomes their default order tracking app for everything and not just Shopify orders, which means that every Shopify merchant is unknowingly onboarding new users onto Shopify's marketplace app. Merchant A gets a customer, that customer installs Shop for tracking, and now merchant B, C, and D can reach that same customer for free. Every checkout in every Shopify store makes the entire network stronger.

10:35 Now, here's a number that got my attention. 48% of orders placed through or referred by the Shop app are the buyer's first purchase from that brand. And nearly half of Shop app order volume is net new customer acquisition. And the best part is that the Shop app is free. And then they rolled out something called Shop Campaigns. A brand sets a target customer acquisition cost.

10:58 Shopify runs the campaign across the Shop app, Shopify storefronts, and external app platforms like Meta, Google, and Tik Tok. But the brand only pays money when the campaign delivers a verified new paying customer, which is a completely different pricing model from what Meta or Google offers. They also built automated retargeting through the shop app itself.

11:18 Someone abandons your cart on your site, your product resurfaces next time they open the shop app. Now, students in my class have been turning shop campaigns on and getting a lot of sales from it. And if the momentum continues, Shopify's app could eventually become a real competitor to Amazon as a one-stop shopping app, which is a piece nobody's paying attention to yet.

11:40 Amazon is a deteriorating monopoly trying to bully everyone around. Meanwhile, Shopify is quietly building a network of stores that acts like one big store, and it's free. So, here's my take on all this. Shopify is more poised for growth in the future than Amazon is. And that reason is AI. AI is changing everything about how people find products. And Amazon is taking a defensive approach, blocking every AI can, squeezing sellers to protect its ad business, and trying to force shoppers back into their walled garden.

12:11 And the problem is that garden is leaking badly. An entire generation of shoppers has already moved their product search to Chach BT, and Amazon just walled itself off from all of that. Now, I don't know if that bet is going to work out for them, but history would say no. Every company that tried to fight a distribution shift by walling itself off has eventually lost.

12:32 Meanwhile, Shopify is building for exactly the world that's coming. AI traffic tripled last quarter. The Shop app is stitching stores into a network that acts like one big store. And Amazon itself is quietly routing traffic off Amazon through Shop Direct, which tells you everything about where they think this is heading. So, keep a small Amazon presence if that makes sense for your customers.

12:53 Some buyers just want to buy on Amazon, and that's perfectly fine. But if you're building for the next 5 years of e-commerce, you're building somewhere else. And now that you understand the shift that's happening right now, make sure you watch this video next on how to find winning products to sell in today's