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11/11/2021

The online retailer with the lowest prices is …

Dan Berthiaume
Senior Editor, Technology
Dan Berthiaume profile picture
One online retailer offers the lowest prices in almost every category.

One retailer has the lowest online prices in every category except pet items, but another is gaining on it.

Amazon is the cheapest online retailer in the U.S. for the fifth consecutive year, according to the fifth annual “U.S. Price Wars” study from Profitero. The report analyzed prices for 15,530 products across 15 categories from 12 leading online retailers, including Amazon, Best Buy, Target, The Home Depot and Walmart.

Amazon had prices that were 14% cheaper on average than competitors. The e-tail giant beat 11 of the 12 retailers examined in every category, with online pet retailer Chewy being the only company to match its low prices in any category (pet items).

Highlights of Amazon’s competitive price standing include its being found, on average, 13% less expensive than Best Buy, Target and Walmart for electronics; 15% cheaper than Target and Walmart for video games; and 11% cheaper than The Home Depot, Macy’s, Target and Walmart for toys and games.

However, Walmart’s prices are now, on average, within 4% of Amazon across all categories, a decrease of one percentage point from the 2020 Price Wars study. Prices at Walmart were found to be within 5% or less of Amazon in 13 of 15 categories.

The discount retailer was most competitive for beauty items, food and beverages, and home furniture, all of which were within 1% of Amazon prices. Walmart struggles most to match Amazon’s prices for electronics and video games, which were 9%, and 13% more expensive, respectively.

While Amazon and Walmart continue to fight for the lowest prices, the study found Target is slipping further behind. The discounter was 15% more expensive than Amazon, an increase of two percentage points from 2020. Target’s online prices for beauty products, home furniture, vitamins and supplements, health and personal care, and food and beverage were, on average, 22% higher than those on Amazon. Target’s most competitive category was baby products, although prices were still 6% higher than Amazon.

For the third consecutive year, Chewy has matched Amazon’s prices on pet food and supplies. Meanwhile, The Home Depot is not far behind Walmart in keeping pace with Amazon, with prices that were only 6% more expensive. The home improvement retailer was also within 4% of Amazon for tools and home improvement supplies, a decrease of four percentage points from 2020, and within 5% or less for appliances, home furniture, and sports and outdoor supplies.

 “Supply issues and rising manufacturing costs will make the 2021 holiday season the most expensive of all time,” said Sarah Hofstetter, president of Profitero. “We have found that online prices are up nearly 6% since last October and for some categories, like fashion and home furniture, they are up by almost 9% and 11%, respectively. The good news is that you may be able to find the right price if you shop around and know where to look. The battle between Amazon and Walmart is closer than ever before, and it may come down to whether you are an Amazon Prime or Walmart+ member.”

Profitero monitors prices and other data on more than 70 million product pages across hundreds of unique retailer sites and mobile apps. For this study, Profitero analyzed online prices of 15,530 identical products across 15 categories over a 12-week period beginning July 12 and ending October 3, 2021. Retailers examined include Amazon, Best Buy, Chewy, CVS, The Home Depot, Macy’s, Nordstrom, Staples, Target, Walgreens, Walmart, and Wayfair, which were chosen based upon online traffic, assortment of products, and a high level of consumer interest.

View Profitero’s full 2021 Price Wars report here.