What Shopify app should you build in 2023?

One of the most common questions I get is one variation or another of "What Shopify app should I build?". My reply is always, talk to merchants as you should never build a solution without first identifying what problem it solves and which specific merchants will benefit. Before even writing one line of code, you should have a few potential customers that you've spoken to who expressed interest in paying for any potential solution.

This leads to a second question: "Where can I find Shopify merchants in order to identify app ideas?" My reply is always to attend local meetups and insert yourself into the conversation, whether it's on LinkedIn, Twitter, or another social media platform. If you're in a larger city, the local meetup option is the best, as you can meet a large number of merchants in person very quickly. I find it best to take this advice and apply it to a specific aspect of a merchant's business, such as checkout, fulfillment, fraud, marketing, etc. Find a problem space within commerce that you find particularly enjoyable, and then find merchants who are having problems they're willing to pay to solve within that space. Building and scaling a profitable Shopify app takes time, and it will be much easier if you enjoy the journey.

I tend to focus on either new or growing areas of Shopify. Every year, Shopify introduces new APIs and features that unlock new behaviors, which in turn unlock new opportunities for third-party apps. Building with new APIs provides an opportunity to partner with Shopify and compete with legacy apps that have to adopt the newer APIs or risk being overtaken by newer solutions. Let's take a look at some of the best problem spaces for third-party Shopify app developers in 2023.

To get an idea of where Shopify's focus will be in 2023, we can take a look at their Q3 earnings report which provides some clues as to Shopify's ongoing and future investments. Thankfully, Shopify explicitly mentions the new market segments they are pursuing under "Enter new segments":

Looking at the above slide, we can see that Shopify plans to focus on Markets (Global commerce), POS (Retail), and B2B. With the economic uncertainty of 2023, I'd focus on larger merchants who are less likely to churn and still provide growth opportunities for your business. Additionally, Shopify wants to grow its GMV and this becomes much more achievable with large established merchants.

B2B

In 2022, Shopify doubled down on B2B by providing native APIs and functionality built directly into the platform. Previously they required using either their Wholesale sales channel app or spinning up a separate b2b Shopify Store. Now merchants can use one store and set up company accounts, price lists, and unique B2B checkouts all within their existing Shopify store. This opens the door for GMV growth of new B2B-focussed merchants. I've already seen an uptick in B2B merchants looking for 3rd party apps to solve new problems unique to B2B. It's hard to overstate just how large of a market B2B is and how much of an opportunity this presents to Shopify developers.

As Shopify states in their earnings report, B2B is multiple times larger than B2C which means there's an incredible amount of space for new products and solutions on the Shopify platform dedicated solely to B2B merchants.

Shopify POS (Retail)

According to the Q3 earnings report, POS GMV is growing quickly for Shopify while retail accounts for a majority of commerce revenue at the industry level. Merchants leveraging Shopify POS in retail settings are often more established and less likely to churn. Additionally, Shopify has continued to invest heavily into their retail platform (Shopify POS) and I expect a number of product announcements in 2023 focussed around their POS product. If you look at the Shopify app store, the number of 3rd party apps that are compatible with Shopify POS is fairly low. By building a Shopify POS app, you will have fewer competitors within an important and growing product segment for Shopify. Find local Shopify merchants using Shopify POS and talk to them to learn more about product gaps that you can help fill with a 3rd party solution.

Hydrogen (Headless Commerce aka API-First)

Over the past two years, Shopify has shown a growing investment and commitment to headless commerce. Over the past several years, Shopify has quickly advanced its Storefront API into one of the most flexible and performant APIs on Shopify. In 2021 Shopify released Hydrogen which reduces the complexity and accelerates the adoption of headless commerce. In 2022 Shopify released Oxygen which provides a no-code hosting solution for Hydrogen and in October Shopify acquired the Remix team to further accelerate the Hydrogen product. Most recently, Shopify announced the launch of Commerce Components which opens up the platform even further with a focus on API-first solutions.

Few apps on Shopify's app store have a public API that developers can leverage and integrate with. By building out a Shopify app that is built API-first for Hydrogen and headless commerce, you can reach very large merchants that require the flexibility that existing apps do not provide due to their tight integration with Shopify liquid and themes.