Amazon wins the online price wars, according to study

One retailer has the lowest online prices across 15 categories and against 13 leading U.S. retailers in a new study.

Amazon claimed the top spot as the cheapest online retailer in the U.S. for the sixth consecutive year, according to the sixth annual “Price Wars” study from e-commerce analytics firm Profitero. The report compared the everyday online prices on nearly 15,000 items in 15 categories across 13 leading retailers.

The data was collected daily over 12 weeks (Jul 11 - Oct 2), with daily prices averaged over the full period for comparison and analyzed online price competition (among online retailers in both the U.S. and the U.K.)

Profitero found Amazon to have the lowest online prices among all retailers studied, with prices that were on average 13% less expensive than competitors. By comparison, Amazon’s prices averaged 14% less than other retailers in last year’s study. (Amazon also ranked first among U.K. retailers.)

The study found that online competition for typical holiday gift categories was close, with retailers such as Walmart, The Home Depot and Nordstrom coming within 2% to 5% of Amazon’s prices, and pet retailer Chewy matching Amazon’s prices exactly for pet supplies. But Amazon blew its rivals away when it came to video games and electronics.

Amazon Vs. Walmart, Target

Among the 3 biggest online retailers (Amazon, Walmart and Target), Amazon continued to lead the pack with prices that were an average of 6% less expensive than Walmart and 16% less expensive than Target.  

But Target’s pricing has become more competitive with Amazon’s compared to last year. The retailer gained ground in eight out of 15 categories studied, most notably beauty, health & personal care and vitamins & supplements. Toys & games was Target’s most competitive category, with only a 6% price difference compared to Amazon.

“This is the sixth year in a row Amazon has had the lowest online prices in the U.S. and third year in a row in the U.K., wrote Mike Black, chief marketing officer of Profitero, in a post on the company’s site. “It’s a testament to their sophisticated price matching technology as well as their bull dog toughness when negotiating with suppliers on cost.”

Black added that, as consumers cut spending due to inflation (especially on the discretionary categories most popular during the holidays), “it will be interesting to see if Amazon can translate low prices into more sales versus rivals.”

In addition to Amazon, the following U.S. retailers were included in the Profitero study:

• Best Buy;
• Chewy;
• CVS;
• The Home Depot;
• Macy’s;
• Petco;
• Petsmart;
• Nordstrom;
• Target;
• Walgreens; 
• Walmart; and
• Wayfair.