Amazon (NASDAQ: AMZN) and (NYSE: SHOP) represent two ways to invest in the e-commerce sector. Amazon, the world's largest e-commerce company by annual revenue, sells its products through its first-party marketplace and a network of third-party sellers. Shopify doesn't operate its own marketplace. It provides self-service e-commerce tools that enable merchants to build websites, process payments, fulfill orders, and manage marketing campaigns.

Amazon's core e-commerce strategy is to lock merchants into its own ecosystem, while Shopify's approach encourages merchants to forge their own online identities without joining a massive marketplace. But their interests and strategies have also been overlapping in recent years.

Last year, Amazon launched its "Buy with Prime" buttons, which tether independent merchants to its payment processing and fulfillment services. Shopify's Shop app, which launched in 2020, serves as a centralized marketplace for finding local businesses, making online payments, and tracking orders.

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Source Fool.com