OnDemand WTP Pricing Research

Prices are becoming more uniform and that’s to Amazon’s advantage | Digital Commerce 360

While e-commerce is driving retailers to change prices more frequently, it is also leading to more uniform pricing across online and offline retailers, according to a new National Bureau of Economic Research working paper by Alberto Cavallo, Harvard Business School professor. Those conditions are giving consumers less reason to comparison shop since it’s unlikely they’ll find a better price.

That could produce a significant benefit to Amazon.com Inc., given that 76% of consumers in a March Internet Retailer/Bizrate Insights survey said that Amazon was the first or second place they look online when shopping for a product. That far outpaced the next-most-visited online destinations: Google (37%) and Walmart (20%).

The working paper is based on a large data trove that examined several large multichannel retailers’ daily price changes from 2008-2017, along with other databases that examine 50,000 products sold by Walmart in March 2018 and that contain ZIP code-level pricing data from Amazon, Walmart, Best Buy and Safeway across 10,292 products.

The growth of e-commerce, and Amazon in particular, has led retailers to change the prices of products more frequently than they did in the past. For example, 15.4% of the products that Cavallo examined had a price change in the course of an average month from 2008-2010. That percentage nearly doubled to 27.4% between 2014-2017. And regular prices (excluding sales and other discounts) lasted 6.5 months, on average, between 2008 and 2010, nearly double the 3.7 months, on average, between 2014-2017.

Read complete article here:

Prices are becoming more uniform and that’s to Amazon’s advantage.

Post a Comment

WP-SpamFree by Pole Position Marketing