Watch out Amazon…Home Depot narrowing price gap

Ottawa, Canada – Home Depot is narrowing its price gap with Amazon.com, which typically offers the lowest overall prices on home improvement goods.



According to a recent study from pricing analytics provider 360pi, “Building Up to Home Improvement Season,” Home Depot was the most aggressively priced home improvement “category killer,” with an average price of just more than 5% above Amazon, narrowing down to around 3% above Amazon by the end of the sampled period (May 1 – June 16, 2015).



The other major home improvement category killer, Lowe’s, was pricing the sampled assortment at an average of 11%-13% higher than Amazon. There was minimal overlap in home improvement products sold by both Wal-Mart and Amazon. However, there was a sizeable SKU overlap between Wal-Mart Marketplace sellers and Amazon, with Wal-Mart Marketplace being one of the most uncompetitive in this chart, along with ATG Stores.



Amazon leads in lowest price in the home improvement category, offering the lowest or same-as-lowest price 96% of the time in 360pi’s sample set. Several of the other retailers employ a variety of non-price promotional tactics including financing offers, cardholder exclusive discounting, and contractor pricing allowances that influence price.



Amazon’s high proportion of lowest and same-as-lowest prices was followed by Home Depot, who was playing aggressively against Amazon, and by online pure plays: eFaucets, Wayfair, Lighting New York, and Faucet Depot.