It is the season of online sales, online companies are up for offering heavy discounts with the year ending.
On one hand some merchants are offering heavy discounts, while on the other hand others are holding on to their own primitive ideas that worked last year of offering lesser cuts to the customers.
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Amazon played it well during the holiday season from Thanksgiving up to the Cyber Monday. It offered the best prices during these 5 days long holiday period. As per Profitero, the analytics firm Amazon had 13.8% less expensive prices of products than other retailers with similar items.
Profitero carried out its analysis on the prices of thousands of exactly matched products collected from a line of products from Nov. 21–26, 2018, in five groups namely —electronics, appliances, tools & home improvement, video games, and toys & games. The analysis was conducted at Amazon.com, which stands No.1 in the list of Internet Retailer Top 1000, Walmart.com, Target.com, Jet.com amongst other select retailers. In the time period studied, any price collected at the item level was checked across all retailers within a 24-hour period.
The next in line with the closest priced retailer to Amazon was Walmart, which had a 6.5% gap in pricing during the analysis. Jet and Target.com were the next with 15.9% and 16.0% pricing difference respectively against Amazon.
Keith Anderson, Senior Vice President, strategy and insights Profitero said that “During the latest five-day holiday shopping period studied, Amazon was really aggressive on price compared with a three-month study we did for Q2.” The statement further said, “Amazon’s prices were nearly 14% cheaper, on average, than other retailers carrying the same items in five key holiday categories. In Q2, the price gap was 10%.”
Amazon won the lowest price cut race but it is also necessary to find out whether the retailers promoted their offers well or not as compared to 2017. As discounts may lead to heavy sales but can adversely affect the retailer’s margin.
Wayfair Inc., the online furniture and décor retailer did extensive promotions during the holiday season. And the strategy proved positive as the Wayfair sales grew up to 58% during the 5 day holidays. Over the past two years, Wayfair’s Q4 growth rates have averaged 80-85% of the “Cyber Five” growth rate.
Wayfair says it has created massive promotional campaigns to achieve such high sales. Remarking about the holiday sales, Niraj Shah, CEO, co-founder and co-chairman, Wayfair said that, “We anticipated the continued shift of dollars online and were well positioned to confine that growth on Black Friday and throughout the weekend with an extraordinary number of flash deals and holiday promotions.”
However not all the retailers are showcasing heavy discounts or sales during the holiday season. For instance, financial services firm Canaccord Genuity Group Inc. in its Black Friday promo tracker of 14 lifestyle brands and retailers, uncovers that this year the promotions were “largely consistent with or shallower” as compared to the last year. Out of the 14 retailers it tracked, six had lesser promotion levels, seven had same promotions as last year, and there was only one retailer that was more promotional as compared to last year.
The Canaccord Genuity Group Inc. in a note writes, “The promotional stance should come as little surprise as the consumer is healthy, inventory levels at retail are clean, and innovation across many brands has ramped up this year,” the financial services firm writes in a note.
For customers with plenty of shopping to do, you can find the best deals on Shopbrain. Last month Shopbrain initiated a browser extension that helps the customers to search the prices of more than a billion products from more than 10,000 retailers, vendors and search engines, like Amazon, Best Buy, Home Depot, Walmart, Target and Google Shopping, to assist shoppers in making the best deals.