Shopify buys Montreal startup Return Magic to beef up return game

Shopify’s own collection of unique apps and the developers that create them is paying dividends.

The Canadian ecommerce engine has acquired Montreal’s Return Magic in a deal that should see Shopify improve its return capabilities for online store owners. Return Magic was developed within the Shopify app ecosystem.

Cofounders Guillaume Racine and Raff Paquin announced their firm’s acquisition in a Medium post. The two credit Shopify’s partner program with helping to grow their company from the early beginnings and say that for that reason the acquisition “felt natural.”

Founded in 2016, Return Magic was aimed at simplifying the returns process, which involves a complicated mix of user experience, financial processing, inventory management, logistics and more. Unsurprisingly, returns are typically of great concern for online retailers to manage.

Racine told the National Post that managing returns well can lead to repeat customers, whereas a bad experience can turn people off.

“Some people may think that a return means that a sale has gone wrong. Actually, that’s not always the case,” he said.

“Returns are kind of essential to the shopping journey.”

Return Magic has just four employees including the company’s two co-founders. Racine told the Post that they work with nearly 2,500 retailers, with “99 per cent” coming within the Shopify ecosystem, which caters to more than 600,000 merchants worldwide.

Shopify’s motives to add the startup seem transparent in its drive to position itself as one-stop shop for retailers, providing e-commerce, inventory management, marketing and other services.

Louis Kearns, head of shipping services for Shopify, told the Post that the move represents a shift for the company, taking returns from an add-on to core aspect of the Shopify platform.

“We feel really good about our ability to really go deep in this space, and provide native capabilities within the Shopify platform itself,” he said.

“By bringing in Guillaume and Raff and their team, we get an injection of that DNA and subject-matter expertise that will help us build the best native solution within Shopify.”

Kearns added that for the time being, Return Magic will continue to function as a stand-alone app in the Shopify app store.


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