A whopping 76% of shoppers expect to do most of their holiday shopping on Amazon this year
A whopping 76% of shoppers expect to do most of their holiday shopping on Amazon this year, according to a study from CNBC.
Nearly half (45%) of respondents listed e-commerce as their top channel for holiday shopping this year, up from 40% in 2016, and Amazon is in position to once again capitalize on online shopping’s popularity.
Meanwhile, although Walmart is the second-most popular option, only 8% of respondents selected it as their main holiday e-commerce destination. This gap underscores how popular Amazon is, and how much ground US competitors have to make up.
Amazon’s control over e-commerce search, and its ability to convert searches into sales, makes it hard to overcome. The vast majority (65%) of consumers who shop online reported searching on Amazon all or most of the time. And Amazon has had great success bringing people from the beginning of the purchase process to the end, as 57% of those who usually search on Amazon buy from the e-commerce titan most or all of the time. This is an impressive conversion rate, and it gives competitors little opportunity to draw consumers away from Amazon, since many consumers start on Amazon and never leave the site.
Retailers should look to offer free shipping if they want to lure shoppers away from Amazon. Forty-three percent of respondents selected free shipping as the most important factor in online shopping. Retailers must find a way to make free shipping easily available to consumers, ideally in a less expensive format than an Amazon Prime subscription, as that would give them the upper hand on Amazon. Shipping is costly for retailers, making this difficult, but it would be a worthwhile investment if it successfully draws consumers away from Amazon.
If Amazon wants to extend its dominance, it will need to find ways to attract low-income consumers. Only 20% of US shoppers who do most of their shopping online have incomes equal to or below $30,000. Amazon is already very popular among more affluent consumers, but with Amazon Prime possibly becoming saturated in the US, it needs to find ways to make online shopping, and Amazon in particular, more amenable to low-income consumers. Amazon has already introduced a $5.99 per month Prime subscription for those with an Electronics Benefit Transfer (EBT) card, but if it wants to dominate this demographic, it will likely need to do more.
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