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Wix’s Competitive Advantage: Penetration and Expansion


Wix.com is a leading do-it-yourself (DIY) platform that has recently gone public.  It is the first of its peers to do so.  Now that the opportunity to invest has presented itself to everybody, the question arises as to how Wix compares to its competitors. 

A good friend, Phil McKeating raises some points about whether Wix could be the right play. Phil gets a 10 out of 10 on creative titling for his post, “Wix-ful thinking”… I wix I would have thought of that… but unfortunately, that was his best content 😉

Today, I want to talk about 2 key indicators for success: market penetration and money spent on growth.  This will respond to Phil’s 1st and 2nd points.  Phil questions: 1 – The growth strategy of Wix and 2 – Wix’s differentiating factors.  His mobile comment (3rd point) is terrific and will get a dedicated post (stay tuned).

The short version

  • Wix has market penetration in the right areas.
  • Wix is spending more money than its peers to expand.
  • Wix will see long-term gains.

The full story

Market penetration

In understanding who might lead an industry, you have to make comparisons among competitors. There are many ways to do this. Phil argues that Wix lacks an open-source portal but perhaps he hasn’t seen the Wix App Market, launched in 2012. 1 2


For now, let’s assume that all the platforms are created equal. The next question, then, is market penetration.

The chart posted below is a Google trends chart comparing relative popularity of search terms globally.  It compares Wix, SquareSpace, Weebly, and WordPress.  As you can see, WordPress is way ahead (in green).


It is a known fact that WordPress has the most market share but I would not consider them a direct competitor. WordPress is not a (DIY) platform as it requires coding for any real customization and it is definitely not drag-and-drop. The bigger issue from a business standpoint is that they monetize less than 1% of their users and are not in much hurry to change that. In fact, doing so runs a bit counter to their open source philosophy.

So taking WordPress off the table, let’s get a bit more granular on the true Wix competitors.

Here, again, we have a global Google trends chart.  As we can see, Wix is ahead, with Weebly close behind and SquareSpace lagging a bit.


Another way to look at it is Alexa.com rank:



Screen Shot 2013-10-30 at 5.24.17 PM

This shows Weebly ranking in first place in the USA and narrowly above Wix globally. SquareSpace, again, is lagging a bit.

While the above is a good start, I think it is also prudent to look more closely at which geographic areas each platform has penetration in- this way we can look at areas where there is more long-term growth potential.  The previous link is a look at my article on internet growth globally.


As we see below, Weebly has most of their penetration in English speaking places such as Australia, New Zealand, the United States and the United Kingdom. These countries are also areas that have some of the most mature internet populations.



Here, again, we see penetration in the United States, Australia, Canada, etc. These mature markets are ones that are already largely developed from an internet standpoint.



Looking at the chart below, Wix is way ahead of the game with respect to penetration in emerging internet areas. Beyond what you see on the list, places like India and China are also more colored in than the charts for Weebly and SquareSpace.


Penetration final thoughts

Working in mature internet areas is fine, since there is still significant growth to be had, and there is generally more purchasing power in those regions. But in thinking about 5-10 year growth and beyond, it is better to look at markets that will see exponential growth.


So we have seen that Wix has penetration in the right areas as far as long-term internet growth goes. But the other piece to this puzzle is expansion in these areas. One of the key indicators for expansion is how much companies are spending to expand. So lets take a look…


SquareSpace has decided to grow more organically. They have 190 employees with $38 million in total outside investment. 1 2 While they are focused on growth as well, basic math tells us that their commitment to organic growth means they can only expand with the money they are making.


Weebly has taken very little outside funding (650K) and says it funds growth organically as well. They say they are adding about 500 more employees and have expanded into a 50,000 sq. ft. building in San Francisco. 1 But, same as the point above, running profitable means less money with which to expand.


Wix raised over 100 million dollars in its IPO for the company to continue to fund its growth. Wix has seen three consecutive years with over 100% growth in revenue each year. Wix CEO, Avishai Abrahami, said, “The growth potential is huge, particularly in trying to penetrate globally into more regions. The decision was to raise money now so that we could continue to improve R&D and to invest more in marketing to pursue those other users.” 1 Wix is hiring at all its international locations. So basic mathematics shows us that Wix has more money to expand with than the other platforms.

If reasons behind the value of quicker expansion aren’t too obvious, here’s a nice visual to help reinforce the point.  This shows that the more you spend on expansion earlier on, the more you lose in the short term, but the more you gain in the long term.




Wix has penetration in better markets globally and is spending more money on expanding. I believe this will create a situation that generates more long-term value for Wix compared to its competitors.

And Phil, just because Microsoft and Apple compete doesn’t mean investing in one or both is a bad idea.  Next time I’m wix you we’ll talk about wix one is best.  I hope you have your wix about you.  Wix or wixout you, Wix is going places.  (I couldn’t think of anymore).


I personally hold a long position in Wix. As always, my posts are my personal opinions and are not portfolio advice.

James Murphy is an entrepreneur, avid boater, and philanthropist. He looks to take on projects of integrity that are working to make a difference in the world. He is an investor, board member, and blog contributor of EquityNet.

Visit his Google+ profile HERE or visit some other projects he is proud of:

DrPerlmutter.com, EquityNet.com, SlideMoor.com, LEVEFoundation.org, SitwayenDevelopmentGroup.com, ProtonEnterprises.com

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