What: Shares of Shopify (SHOP -2.44%) popped 25% in June, according to data from S&P Capital IQ. The cloud-based commerce platform is a member of the IPO class of 2015, and by all accounts, it looks as if its growth is just getting started.
So what: Shopify's stock price got a boost from the announcements of two big deals in June. First, it was the news that Shopify would be the first e-commerce platform to offer small and medium-sized businesses the opportunity to sell goods on Pinterest using its new "Buyable Pins" feature.
Pinterest's new Buyable Pins feature allows users to buy items without ever leaving the Pinterest app. Source: Pinterest.
Then came news that Shopify will also give its merchants the chance to advertise and sell their products on Facebook via its new "Buy" button. The two companies had been testing the program since September, and Shopify will now be expanding it to more of its customers.
Now what: The deals with Pinterest and Facebook are big news not just for Shopify, but also for the entire social-media and e-commerce industries. By allowing users to shop for items without leaving Pinterest or Facebook, these initiatives will help to position social media as a source of not just leads and referrals, but also of outright sales. It should also help to improve engagement on these sites, while allowing for a more direct measure of the return on investment for advertisers.
All told, Facebook's Buy button (and, to a much lesser extent, Pinterest's Buyable Pins) is likely to be true game-changer. And with Shopify positioned as a first-mover within this emerging trend, the company -- and its shareholders -- stand to benefit tremendously in the years ahead.
