E-commerce giant Shopify, the provider of an advanced software platform for online buyers and sellers with millions of registered merchants, has invested an undisclosed amount in Israeli e-commerce marketing firm Yotpo and will embark on a multi-year platform partnership with the company to help clients grow their businesses.
According to a joint announcement on Thursday, the partnership will help drive Yotpo’s growth and product development trajectory as well as provide merchants with new ways to “connect with their customers and grow their businesses through innovative marketing tools and solutions.”
The two companies will work collaboratively to develop better shopping experiences and improve relationships between merchants and their customers as part of Shopify’s new development features, according to the statement.
Shopify was founded in Ottawa in 2006 and has become a leading global commerce company that helps entrepreneurs and sellers manage their retail business. The company says it works with over 1.7 million merchants in more than 175 countries including major brands such as Heinz, Steve Madden, and Gymshark. Shopify generated annual revenue of close to $3 billion in 2020, and managed nearly $120 billion in gross merchandise volume — the total dollar value of orders facilitated through the Shopify platform — that same year, according to its financial records.
Yotpo is a Tel Aviv-based company founded in 2011 that helps brands with marketing plans such as creating customer content by messaging users through email and text messages to get their reviews about a product they purchased. It adds marketing features such as coupons and enables customers to upload photos of themselves with the new product they have acquired. Yotpo says it specializes in driving customer engagement and retention, and has grown to include over 30,000 e-commerce customers worldwide.
Earlier this year, Yotpo raised $230 million in Series F funding, its largest investment round to date, at a valuation of $1.4 billion.
Tomer Tagrin, co-founder and CEO at Yotpo, said the new partnership with Shopify was “a significant milestone” for the company and builds upon the existing working relationship with Shopify. The companies have mutual customers like Steve Madden, online women’s clothing shop Princess Polly, and US lingerie shop ThirdLove.
Shopify merchants will be able to tap into “five cutting-edge products” developed by Yotpo, said Tagrin, including SMS marketing, loyalty and referrals programs, reviews and ratings features, and a tool that displays customer photos and videos across the buyer journey.
“We look forward to working even more closely with Shopify to provide smarter, more connected experiences that create real value for our mutual customers,” Tagrin said.
The platform partnership with Shopify “deepens the integration between our two technologies,” he added, “directly responds to the enormous amount of time and energy merchants currently are required to spend competing for customer attention.”
Brandon Chu, VP Product Acceleration at Shopify, said Yotpo was “a shining example of what is possible in the Shopify Ecosystem of partners and developers. We have watched the team deliver incredible value to merchants and have admired their tenacity and passion for building a better version of e-commerce where independent brands own relationships with their customers.
“Their marketing technology solutions have become trusted by thousands of merchants, and we are thrilled to invest in their growth and create even more impact, together,” added Chu.
Yotpo integrates with the tools online businesses use every day, including Google and Instagram, and is available on all major e-commerce platforms, including Salesforce Commerce Cloud, Magento (an Adobe company), and BigCommerce.
The firm has offices globally including in New York, London, and Tel Aviv, and is backed by investors such as Bessemer Venture Partners, Tiger Global, Claltech Investment, Coin Ventures, Hanaco, Vertex Ventures, and Vintage Investment Partners.