Magento v1 was sunsetted at the end of June 2020 making way for Magento v2 as the standard for launching new Magento stores, or migrating existing Magento v1 stores to. Previously, Magento v2 was known as the Magento Enterprise, but after Adobe acquired Magento, they decided to bring everybody onto Magento v2 with both a Community and Enterprise edition. Overall, eliminating the cost and complexity of maintaining two codebases is a net positive for the Magento community.
Magento Community vs Enterprise Edition vs Commerce Cloud
Now that Magento has a Community and an Enterprise edition, naturally the question for e-commerce developers is “What features and benefits does Magento EE provide that CE does not?”
Magento EE is licensed as a subscription ranging anywhere from $22,000 to $125,000 per year depending on the transactions & turnover of your e-commerce business. With this subscription, you get a Magento account manager and 24/7 technical support from Adobe, in addition to features that will benefit larger operations with over $1M in annual revenue, or B2B e-commerce stores the most.
Although the differences between the Enterprise and the Community edition are too many to cover here, some of the additional features of Magento EE include: a drag-and-drop visual merchandising tool, customer loyalty tools (e.g. points, in-store credits, gift registries), advanced order management (OMS), support for multiple languages and currencies, and PCI-compliant payments with the Magento Secure Payment Bridge.
If you need just a few of the Magento EE features, there is the possibility of installing paid extensions to Magento CE to achieve similar functionality without the annual commitment of an Enterprise subscription. Magento CE supports the official Stripe Payments extension (free) where checkout is integrated with Stripe.js, simplifying PCI compliance without redirecting customers to a separate payment page.
Commerce Cloud is a hosted (SaaS) edition of Magento Enterprise where you do not have to provide your own servers to host Magento like is required with the Community or Enterprise editions. The cost of Commerce Cloud ranges from $40,000 to $300,000 for e-commerce sellers who don’t have the technical expertise to manage their own Magento Enterprise instance with a conventional cloud provider.
TLDR: If your e-commerce store is targeted at B2C customers, operates in one language and currency, and makes less than $1M in annual turnover, then Magento CE is the most cost-effective edition of Magento to choose.
Magento vs E-Commerce as a Service (e.g. Shopify)
As a mature & time-tested open e-commerce solution released since 2008, Magento CE is an amazingly powerful platform to build an e-commerce store on. There are no hard limits to the number of products, admin users, customers, or transactions – even with the Community edition of Magento; the main limiting factor is the capacity of your server, which can always be scaled in the cloud with professional Magento consultants.
Compare this to Shopify, a software as a service that many novice e-commerce entrepreneurs launch their first stores with. Although the upfront investment of Shopify may seem to be very low at only $29/month for the Basic Shopify plan, Shopify sneaks in a 2.0% fee for using a third-party payment provider versus Shopify Payments.
Not all countries or types of e-commerce stores qualify for Shopify Payments (including some drop-shipping stores), and although upgrading to the $299/month Advanced Shopify plan will reduce your online credit card rate with Shopify Payments to 2.4% + 30¢, large retailers can negotiate individual pricing agreements for merchant accounts that handily beat this rate. With Magento, your developers are free to use any payment integration without Shopify’s 0.5%-2% tax.
Instead of being locked into Shopify’s ecosystem and paying for each feature you need through the Shopify App Store on a recurring basis, starting your e-commerce store with a self-hosted edition of Magento gives you complete ownership over your storefront. Shopify has changed its pricing plans in the past, eliminating the $9/month Lite plan, and increasing the Advanced Shopify plan (formerly called Unlimited) from $179 to $299/month – a 67% increase.
Which cloud provider to host Magento Community Edition?
As of Magento 2.3, Magento Community can be hosted on any cloud provider that supports at least PHP 7.2 – although PHP 7.3 is preferred. Setting up a Magento website on a VPS is not too difficult, but optimizing it for security and performance can require the expertise of a Magento e-commerce consultant.
For a sufficiently large store, Magento can also be set up in a load balanced configuration with multiple application servers and/or a database cluster in the backend. This makes your store more resilient to any traffic spikes from launching a new marketing campaign, and allows servers to be maintained with minimal or no downtime.
We would never suggest hosting Magento in a shared hosting environment because it is a fairly memory and computationally intensive application. Since search engines such as Google consider page load time as a ranking factor, using shared hosting for Magento can be “penny wise and pound foolish.” Studies have shown that each incremental second of load time can drive away visitors or measurably reduce e-commerce conversion rates.
Besides, you can face frustrating timeouts when uploading large CSV files with thousands of rows of new products and product attributes if you host Magento on a slow, shared hosting server.
Also, many Magento extensions assume that you should have SSH root access to properly configure the permissions & ownership of the files on the server. When you self-host Magento with any VPS or cloud provider, you or your developers benefit from full access to make any changes or customizations to the store.
Moving your Magento instance to a cloud instance on AWS, Google, or Oracle Cloud means that you can always resize your Magento servers, secure your customer data in-transit and at-rest with encryption, and use content delivery networks (CDNs) to accelerate the loading of product listings and images.
Get in touch with us with an estimated number of products, customers, and transactions you expect per month and we will provide you with a quote for a customized Magento infrastructure — built by expert cloud architects who will tune & secure Magento Community Edition for a future-proof e-commerce store.