Reports surfaced this week about Amazon quietly removing “listing prices”, aka original prices advertised in comparison to discounted – and supposedly discounted – items. The new move could signal Amazon is moving away from discounts as a differentiation point and instead relying on loyal customers, repeat orders, and variety of products available. According to Clarkson University professor of consumer studies Larry Compeau said Amazon’s strategy was to lose on every sale but make it up on volume. “It was building for the future, and the future has arrived. Amazon doesn’t have to seduce customers with a deal because they’re going to buy anyway.”
L2’s 2016 Amazon Fashion study finds that the e-tailer is becoming a go-to destination for basics like jeans, flip flops and t-shirts as basic items perform better than the latest trends. This is reflected in the price of best-selling items on the e-tailer. For example, 24% of best-selling footwear SKUs on Amazon cost less than $50 whereas just 6% of Nordstrom best-sellers in footwear fall in that category. The gap narrows in the $50 to $100 price range, where 41% of best-selling Amazon footwear and 45% of best-selling Nordstrom footwear fall. And when it comes to higher-end items (shoes that cost more than $150), Nordstrom is clearly in the lead.
Fashion brands have yet to embrace Amazon: across the 29 Fashion brands tracked in L2’s Amazon Fashion study, 81% were sold via third-party sellers. However, Amazon’s niche in casual fashion – Skechers, Adidas, and Crocs – could be enough to sustain repeat customers.