Yahoo Finance Amazon Leads in Online Retail ‘Price Wars’
In its fifth annual e-commerce “Price Wars” study, researchers at analytics company Profitero found Amazon to be the price leader in fashion apparel. The results stem from an analysis of more than 15,000 products across 15 categories from 12 leading online merchants.
Overall, Profitero found “Amazon to be the cheapest on average by 14 percent, beating out 11 of the 12 retailers examined in every category — but Walmart and others aren’t far behind,” the company said.
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In fashion apparel, the analysis revealed that Amazon’s prices were 16 percent less expensive on average. “Walmart was the only retailer who managed to close the price gap with Amazon, decreasing 5 percentage points from our 2020 study. Macy’s on the other hand saw the gap widen by 18 percentage points,” the company said.
The study showed that Nordstrom was 7 percent more expensive than the same products on Amazon, on average, which is an increase from 5 percent in last year’s report, while Target was 12 percent more expensive than the same products on Amazon, which is a slight increase from 11 percent in the previous study. Macy’s was 31 percent more expensive than the same products on Amazon, which Profitero said reflects “a massive increase” from 13 percent last year.
Authors of the report said supply shortages and rising manufacturing and shipping costs “are having a big effect on price. Our latest eCommerce Price Index shows that prices at online retailers rose again in October 2021, and are up 5.5 percent year-over-year.”
“What this means is that consumers are going to have to work hard this coming holiday season not only to find retailers with products in stock, but the best prices, too, as there’s little incentive for retailers to discount too deeply with such heavy demand and little supply on hand,” the company said.
Across all categories, the report said the only retailer “currently matching Amazon on prices is Chewy, in pet. But other competitive retailers narrowed the price gap versus Amazon in 8 of the 15 consumer product categories featured in this study, with the biggest threat coming from Walmart.”
The report noted that Walmart Inc. “is giving Amazon a run for its money, closing the price gap in 10 of 15 categories versus where it was a year ago.” The research found that Walmart’s prices are within 4 percent of Amazon across all categories, which is down 1 percentage point from last year’s study. “Prices at Walmart were found to be within 5 percent or less of Amazon in 13 of the 15 categories studied,” the report stated.
Profitero also found that Target’s prices are, on average, 15 percent more expensive, compared to Amazon across the categories studied, which is an increase of 2 percentage points from the prior study. “Notably, Target’s prices are more expensive, on average, than Amazon in many general merchandise categories, as well as beauty, this year versus last year,” the report noted.
The product comparisons were done between retailers on the same day, and the company stated in the report that items “were matched exactly. Profitero’s methodology includes comparing online prices between retailers only on items that are identical (same UPC, brand and pack configuration).”
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