French tech company PrestaShop has developed a free platform to build an online store. Founded back in 2007, the software company has helped approximately 250,000 online stores come to life.
This year, PrestaShop released a cloud version of its software, and established a $1 million fund for developers who contribute ideas of new features for the service.
Tech.eu caught up with Stefan Devroey, PrestaShop's chief internationalisation officer, to discuss how e-commerce has changed in recent years, what online stores should do to be (and stay) competitive, and why community matters.
Tech.eu: How did PrestaShop come about?
Stefan Devroey: In the early days of e-commerce, people clearly wanted to sell online and we jumped on that wagon very soon, as we recognised the need. There was not any open source content management system or e-commerce system that enabled people to sell online. People had to make their own websites or get very expensive websites from an agency or a developer. But there was no solution easily available.
We found it important that a merchant can really manage his business. That’s why in our back office, we have incorporated a lot of statistics not only on the number of sales, but also a forecast of an amount of sales, what he can expect in the coming days or coming months with the product he has and sales he had in the past.
How has e-commerce evolved since PrestaShop started in 2007?
The Internet has really boomed: you have much more competition from huge stores like Amazon or Ebay, which makes it hard to have a competitive e-commerce offer. We think that merchants really need to make a difference by offering a specific service, catering to niches, or looking at the way they are presenting their products. Localization may be really a good solution, but competition is tough.
It is important to have a good search engine monetization of your store to be found on Google and any other search engine that is available. The design has also changed a lot: particularly the responsive design has gained importance. You need to have your software available on the tablet or mobile phone as well as on the desktop of PC. We also see that there appeared a lot of regulations in each country - and not only in Europe. Germany, for instance, is really particular in all kinds of regulations for an e-commerce store. And we were able to incorporate that in our new version 1.6.1; there we are fully aligned with all those regulations.
You’ve mentioned that competition is much more intense now than several years ago. How do you plan to tackle that?
Actually we have only one competitor, especially for fashion: Magento. We try to differentiate from them by focusing a lot on performance. Ease of use, of course, is very important: we want to be very easy for a merchant to start his online store, and our back office is very user-friendly.
How does PrestaShop’s cloud version work?
We made an agreement with OVH, which is one of the biggest hosting servic providers in the world, and we offer a full version of PrestaShop on their services; it is completely hosted, with one click you can start your store. The merchant can choose a domain name and after that the store is completely created. It is based on the same code as our downloadable software, but it is completely located in the cloud. We saw that, in the past, the installation of the downloaded version was still too difficult for some users, so we’ve decided to introduce a cloud version as well.
PrestaShop recently raised $9.3 million. What is your business model?
We have actually two revenue streams in our company.
The first one is our marketplace, where we have more than 6,000 modules that can be downloaded, to extend the possibilities and features of PrestaShop — being it purely by themes and templates or specific modules to increase SEO. The second stream is from our partners, such as payment providers or shipping providers who pay us a fee to be presented in our back office. In that way we keep our software completely free for the merchant, being it a downloadable version which the merchant need to host himself, or our cloud version where we include hosting as well.
This year company has established an Integration fund of $1,000,000. What’s the idea behind that?
It is created more for our community of developers. If they have an idea how to extend the PrestaShop functionality through a module, they can present us their idea and we will fund it. We will pay them and create that module available in our marketplace.
Do you already have any outcomes from this program?
We are currently in the selection procedure; we have over 300 applicants who sent us proposals for modules; we have an internal judge who is looking at those proposals and will select the most interesting ones. It is a very broad range — it can be a shipping module in a country where we do not have specific shipping module yet, it can be an idea to extend certain type of payment, something to connect with existing European systems, and whatnot.
You constantly emphasize the importance of the community for PrestaShop. How do they contribute?
We rely very heavily on our community; today we have a community of more than 850,000 merchants, of which 250,000 are running e-commerce stores. We have more than 80,000 developers working in 65 different languages all over the world. In every country in the world, we have at least one Prestashop store and one PrestaShop developer.
If they want to propose new features we can put it in the core, but it can also be a translation of the software. People in different countries can contribute to the translation of PrestaShop to make sure that we have it in every language. This, we rely on the community to do the translations. Within the forum, a lot of support is given to merchants between each other: merchants to agencies, merchants for merchants, people from PrestaShop to the merchants. We have annual meetups in every country, where Prestashop users meet each other and discuss the best practices of the software or give each other hints and tips on how to improve their stores.
E-commerce is getting extremely popular in emerging markets. Which countries are now the most important for you?
The markets that are the most important for us, are those where we have our country managers, starting with France and the USA. Besides that, we have country managers in Spain, Italy, Germany and soon one in the UK. But we are looking very much at the Scandinavian countries, and countries like Poland, Bulgaria, Russia and China are growing very well. We even have requests from Iran, Iraq, Saudi Arabia, which is very difficult for us because of the language barriers of course.
We are looking for ambassadors in specific emerging countries, and thinking about hiring a country manager in some to develop the local teams.
What do you think about the state of e-commerce in general? Has it reached a ceiling, or is there still plenty of room for growth?
If we look at the European numbers, we still see that there is 17 percent of average growth every year in e-commerce revenue. We still see a steady growth of new users, but of course there's consolidation in e-commerce as well: a lot of smaller players stop, while the bigger ones consolidate. The trend now is going from the desktop environment to the mobile environment; people are shopping more and more from mobile devices. I think that for the next five years, it will still be a very interesting market, and we are still riding the development wave.
Are you looking to hire more people, then?
We now have 131 people working for PrestaShop, but we are still looking for 25 new employees, including designers, agency managers, developers etc. We are expanding as fast as possible.
What are your plans for the coming year?
Our focus is on the performance and usability. We have now released a major update of PrestaShop, which is focused on the performance of the software and complying with EU regulation.
Our cloud version is still a baby: we launched it at the beginning of this year, but we expect a lot from that. It will take one to two years to fully see the results of that extension. However, we will just keep going in the way as we did in the past, so there are no major changes in the next 6-12 months.
(All images credit to PrestaShop / Parts of this interview have been condensed and paraphrased)