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Amazon still has the lowest watch, jewelry prices
While Amazon continues to have the lowest jewelry and watch prices online, other retailers slowly are gaining ground on the Internet giant, a recent report by think tank L2 shows.
New York--While Amazon continues to have the lowest jewelry and watch prices online, other retailers slowly are gaining ground on the Internet giant, a recent report by think tank L2 shows.
For its recent “Intelligence” report, L2 examined 27,517 Amazon.com listings of 315 brands in six categories: beauty, fashion, hair care and color, home care, personal care, and watches and jewelry.
The survey showed that Amazon still has the lowest prices for products in these categories relative to other retailers online. Watches and jewelry, specifically, were priced lower on Amazon 81 percent of the time.
L2 said that Amazon continues to have low prices across all categories through a number of mechanisms, with a key feature being that multiple sellers can offer the same product. If more than one eligible seller offers a product, they compete for the product listing with the “add to cart” option or the “buy box” option for that item (the “buy box” algorithm promotes the merchant with the best balance of sales performance and low product price).
Ninety percent of Amazon’s customers make their purchases through the “buy box” rather than searching through other options. Since price is the input over which merchants have the most immediate influence, the others being sales performance analytics like feedback scores, reviews and shipping times, merchants will price their listings to undercut other sellers, L2 said.
Despite Amazon’s price advantage and market share--the Seattle-based e-tailer accounts for one in four online purchases--many brands have started to push back against the e-commerce giant, L2 said.
They’re gaining ground as Amazon’s growth slows. For example, 92 percent of the top 50 e-tailers now offer some form of free shipping, a big draw for consumers.
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Retailers also are beginning to realize the potential of their brick-and-mortar locations as fulfillment centers, with data suggesting that consumers overwhelmingly prefer in-store pick up to next-day shipping. Nearly one in three retailers now support fulfillment of online orders from physical stores, including major retailers like Walmart, Nordstrom and Macy’s leading the way in the movement.
All three beat out Amazon in e-commerce growth in the first quarter of this year, and are starting to compete in terms of delivery time.
“Retail price intelligence companies have observed Amazon’s price competitiveness wane across several price categories over the past year,” according to L2, with Best Buy,
Target, Walmart, and Sears especially making gains in price competitiveness.
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