NEW YORK — A story on the Wall Street Journal’s MarketWatch, published Monday, identified Amazon.com as the latest value-oriented retailer to pose challenges to more traditional brick-and-mortar retailers.
In a report titled “More retailers struggling to navigate Amazon’s surging current,” William Blair & Co. analyst Mark Miller compared merchandise overlap and relative pricing of 24 retailers against Amazon. Miller found that Amazon’s prices represented an 11% discount to the competition, on average.
And it’s not all Amazon’s merchandise, necessarily. Nearly half of the items were available via Amazon.com from a third-party seller. Third-party sellers represent more than 60% of the online retailer’s offerings, the report noted.
Such specialty retailers as Best Buy and Dick’s Sporting Goods stand the most to lose; Walmart and other mass merchandisers are at less of a risk because of their perishable foods departments — a category that cannot easily be replicated online. Similarly, drug retailers face a below-average risk of share loss to Amazon — outside of prescriptions, many items sold at pharmacy satisfy an acute need, such as cough and cold relief, for example.
Target has a 45% product overlapping with an 11% price gap against Amazon, MarketWatch reported, citing the William Blair analysis. Walmart has a 28% assortment overlapping with Amazon priced 5.4% lower on those identical items, the report added.