Wednesday, December 02, 2015

Is Amazon the search engine for online shopping?


It's obvious that Amazon has changed the way many consumers shop. Today, consumers walk into Best Buy with no intention of buying; rather, they use Best Buy as a showroom for the products they ultimately purchase on Amazon! Additionally, many consumers looking to make an online purchase go directly to Amazon rather than Google or a brand-specific website. Clearly Amazon has changed the way people shop, but to what extent?

A recent 2,000 person survey by Bloomreach confirms that Amazon is quickly becoming the dominant player in online shopping search!

  • 44% of consumers start product searches on Amazon! 34% use search engines and only 21% go directly to a specific retailer.
  • 75% of consumers say Amazon personalizes their shopping experience the best! This is probably a result of Amazon's retargeting campaigns and "Customers...Also Bought" sections which show you product ideas that similar consumers like.

As for online retail stores, a survey of 500 companies showed:

  • 44% say their biggest online threat is Amazon
  • Personalization is their top priority (further evidence they are trying to compete with Amazon!)
What does this mean for the future of online shopping? Online retail companies will increasingly compete with Amazon's vast product offerings and competitive prices. Perhaps Amazon hopes these companies will ultimately be forced to list prices directly on Amazon via Fulfillment by Amazon (FBA). Amazon receives a ~30%+ margin per item sold via FBA, so it's not unlikely they are working to push more smaller digital shops to list product on their site. No wonder Amazon's stock price has been skyrocketing lately!



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