The Canadian company added just 71,000 net traders in the first half of 2022, according to YipitData research shared exclusively with Reuters. It added 680,000 at the peak of the pandemic in 2020 and 314,000 last year.
Shopify helps these merchants set up their online stores and payment systems and, in return, receives compensation ranging from $29 per month for the basic offer to $2,000 for Plus subscriptions that provide access to advanced tools.
Chart: Shopify’s global merchant growth plateaus,
A decline in online shopping has hammered the company’s profits this year and forced it to cut jobs, unwinding a bet that the pandemic-era demand boom would last.
“Unless Shopify adds roughly twice as many merchants in the second half of 2022 as it did in the first, we estimate they could be on course to see the lowest net merchant additions in a year since at least 2018. “, said analysts at YipitData.
Chart: The rise and fall of Shopify stocks, 
They added that the slowdown was concentrated in Non-Plus traders, smaller companies that are more exposed to decades-high inflation and rising interest rates.
It could also jeopardize the growth of Plus merchants – the main drivers of Shopify’s gross merchandise volume – as a portion of those subscriptions come from brands moving to Plus.
“You need to get people to the top of the funnel….If you don’t get members today, it will likely affect your Plus conversions in the next quarter or quarters to come,” said Neil Saunders, analyst at GlobalData.
To be sure, Shopify said in its latest results that Plus did “extraordinarily well” and that total merchant growth in the second half would be greater than that of the first.
Company president Harley Finkelstein told Reuters that ASICS and Hewlett Packard were among the big brands that have migrated to Shopify Plus, while many “local success stories” have also embraced the offering.