Shopify’s tortuous path to restricting gun sales
When Tobi Lütke set out 13 years ago to build an online site for selling snowboarding equipment, he had little idea just how complicated the whole enterprise would become.
Today he is piloting a $1-billion-a-year corporation whose technology underpins the operations of more than 600,000 online retailers who sell everything from cosmetics to guns.
That’s still the case despite the revision on Monday of Shopify’s user agreement policy to restrict the sale of particularly lethal weapons like semi-automatic firearms. Shopify’s online merchants continue to sell sporting rifles, handguns and related gear. The company also offers help in setting up storefronts that offer guns and military supplies.
Shopify declined to say how many of its customers will be affected by this week’s ban on heavy metal, noting that it involved only a “small number”. Given Shopify’s huge base of merchants, that could mean ten or ten thousand.
Certainly the U.S. weapons market is huge, encompassing more than 64,000 retailers (according to a recent report by Business Insider). And this business is moving online, according to American Outdoor Brands Corp. (formerly Smith & Wesson), the country’s largest gun manufacturer.
“Although firearms currently cannot be delivered direct-to-consumer,” the company noted in a recent filing, “firearms are increasingly sold on e-commerce websites and delivered to licensed firearm retailers near to the consumer.”
Shopify helps online retailers set up storefronts and also charges for services ranging from payment systems to shipping.
The issue facing the firm now is how its shifting user agreement will affect retailers’ willingness to continue relying on Shopify’s proprietary technology.
Even before this week’s move to restrict the sale of certain firearms, the company had posted a long list of other prohibited activities. These included the sale of anything that might support a terrorist organization, the publication without consent of personal information, the exploitation of children, or the sale of goods and services that defame, harass or promote violence on the basis of race, religion or gender.
Shopify is certainly within its rights to enforce its policies where it concerns the use of its technology. But will customers bolt if they sense Shopify is becoming too heavy-handed? Certainly they have options, even if moving from one supplier to another isn’t exactly straightforward. Two of Shopify’s competitors — BigCommerce and Volusion — happen to be headquartered in Texas in the heart of gun country.
For the moment, Lütke is playing things carefully, probably more deliberately than many of his 3,000-plus employees feel comfortable with.
For instance, early last year Lütke published a blog in which he defended Shopify’s willingness to supply the technology that supports Breitbart.com — the alt-right website that offers a decidedly non-liberal take on immigration, health care and U.S. President Donald Trump.
“I’m a liberally-minded immigrant leading a predominately liberal workforce,” wrote German-born Lütke.
“I’m against exclusion of any kind — whether that’s restricting people from Muslim-majority nations from entering the U.S., or kicking merchants off our platform if they’re operating within the law.”
And so Shopify continues to supply the tools that help Breitbart run its online store.
But Lütke’s thinking on restrictions in general has evolved, including the idea of allowing the sale of everything legal.
“Solely deferring to the law in the age of political gridlock is too idealistic and functionally unworkable on the fast-moving internet,” he wrote earlier this week. “So we have found ourselves in a position of having to make our own decisions on some of these issues.”
This, he noted, was what prompted the most recent update in Shopify’s user agreement, which prohibits the sale of heavy-duty weapons. The new policy “allows space for all types of products, even the ones that we disagree with, but not for the kind of products intended to harm.”
Even so, the line remains unclear. The company confirmed Wednesday the sale of many types of weapons, such as rifles and pistols, are still permitted from storefronts built using Shopify software.
There is a very tentative quality about Shopify’s willingness to take on the role of enforcing its view of the world. Lütke quietly penned his thoughts about a revised user agreement on a blog that does not appear on the company’s website. Shopify minimally informed the affected online merchants by email late Monday night.
This may just be Shopify’s way. The company depends on U.S. customers for more than 70 per cent of its revenues and must be wary of offending that country’s many gun owners. Lütke wants to assess the reaction to this prohibition. Only then will he think about expanding his firm’s list of restricted firearms.