Shopify Glossary Terms

TCO is the all-in cost of running an ecommerce platform for a year. It's the only honest way to compare platforms because the licence fee is rarely the biggest line item.

A complete TCO includes: platform licence (Shopify Plus is the licence; Magento Open Source has none but Adobe Commerce does), hosting (zero on Shopify; significant on Magento, WooCommerce, custom builds), CDN and security (bundled on Shopify; separate on most others), development cost (in-house team or agency retainer), app and plugin subscriptions, payment processing fees, integration licence fees (ERP connectors, ETL tools), maintenance and patching, and operational headcount.

Magento and Adobe Commerce often have a low licence number but high hosting, dev, and patching costs. Shopify Plus has a higher licence but bundles hosting, security, performance, and reduces dev hours significantly. WooCommerce has no licence but the plugin stack often runs $30K to $100K+ per year and dev cost scales with plugin count.

A typical mid-market brand on Shopify Plus runs at $250K to $500K annual TCO including platform, apps, and a partner retainer. The same brand on Magento usually runs $400K to $900K because hosting, patching, and dev rates are higher.

TCO comparisons are easy to game. The honest version uses real numbers from the last 12 months on the current platform and a benchmarked range from comparable brands on the destination platform. Anything else is a brochure.