Cracks in Amazon’s Armor Show Opportunities for Retail Brands to Steal Share Back, According to New SmarterHQ Survey
INDIANAPOLIS–(BUSINESS WIRE)–Retail bankruptcies have jumped 24 percent year-over-year and consumers are increasingly favoring online and mobile shopping as retail brands try to grapple with headwinds ahead of the important holiday shopping season. Much of this evolving retail landscape is attributed to the enormous impact of Amazon, which has more than 310 million active shoppers worldwide and $136 billion in U.S. sales. However, a new report from SmarterHQ, the leading multichannel behavioral marketing platform, shows cracks in Amazon’s armor that retail brands can exploit to start stealing market share back from the e-commerce behemoth.
“The Amazon Report: Consumers Share How Brands Can Win Them Back”
In fact, SmarterHQ’s survey of more than 1,200 people ages 18 to 65+ shows that without free two-day shipping, 82 percent of Amazon Prime users said they would cancel their membership.
“Amazon’s dominance in retail has been the primary focus of retail executives, investors, and board members – yet, the solution to steal back both market share and consumers’ loyalty have evaded most traditional retail brands,” said Michael Osborne, CEO of SmarterHQ. “But our report tells a surprisingly upbeat story for retail brands – consumers can be persuaded to ditch Amazon and shop in their store or on their web site. We found that people aren’t going to Amazon to browse; rather, they have very specific items in mind. Free two-day shipping is very important to Amazon Prime members – so much, in fact, that they would cancel their membership if it wasn’t offered. And consumers have a price threshold of $200 they’re not willing to cross when shopping on Amazon, a good sign for luxury brands. While Amazon is viewed as Goliath by the industry, there are certainly weaknesses that retail brands can exploit to help drive their bottom line.”
A summary of the survey findings includes:
- People really use Amazon to shop for very specific items: 57 percent of buyers on Amazon are looking for a specific product, and 63 percent of all shoppers already know what they want before they start shopping. Potential customers aren’t browsing Amazon, and they are 25 percent more likely to purchase branded products from the e-commerce site.
- Without free two-day shipping, Amazon Prime users will cancel their membership: 84 percent of buyers who had a specific goal in mind also demanded speedy, free shipping. Customers are likely purchasing a retail brand’s products on Amazon simply because they have better shipping options.
- Customers will shop with a retail brand more often if they’re provided relevant messages based aggregated shopper data: In a retailer’s marketing messages, it’s important to include products their customers have engaged with and to suggest new ones based on their customers behaviors. If not, 47 percent of shoppers are moving from a brand’s website and straight to Amazon’s with their personalized product reminders and suggestions.
- Customers may seem like die hard Amazon fans, but it’s really only a few things that tickle their fancy: Between 37 to 57 percent of shoppers on Amazon are purchasing electronics, books, movies and leisure products like toys and hobby items. Luxury brands should find this especially comforting; people chose not to purchase products above $200 on Amazon.
To review all of the survey findings and additional tips that retail brands should consider to better compete with Amazon, you can download the report, “The Amazon Report: Consumers Share How Brands Can Win Them Back,” here.
SmarterHQ is the leading multi-channel behavioral marketing platform, empowering B2C marketers to personalize individual customer interactions in real-time. We work with some of the world’s largest brands – such as Bloomingdales, Santander Bank, Carrentals.com and Finish Line to drive phenomenal business results. We’ve been recognized by Forbes as technology to push B2C companies into a new era of personalization and Forrester’s Total Economic Impact study to deliver 667% in ROI. Visit SmarterHQ.com for more information.