Amazon’s Far Reach

As if being the largest CSE (comparison shopping engine) on the planet isn’t enough, Amazon’s long tentacles reach further than just the site itself. Amazon ads are also placed prevalently on what used to be premiere shopping comparison sites, as seen below.

 

Sites like Pricegrabber, Nextag and others used to be the go-to places for the best prices, but this is no longer the case. Amazon’s marketing techniques are diverse and very much widespread, utilizing the sites that were once considered powerhouses in the market for their own gain. This tactic draws shoppers in from many different avenues—not only to their own site, but to all other comparison shopping sites as well.

The Amazon effect on once-powerful competitors can be seen below:

Let’s take a look at how a company with humble roots (Amazon was started by 3 guys out of a garage) grew to be the Goliath it currently is today. Amazon was founded 18 years ago, in 1995, and the founders vision was for it to simply be “the worlds largest bookstore”. It saw sales of a half-million dollars in the first six months in operation. The following year its sales grew to $15.7 million and the following year, its revenue was a whopping $147.8 million. Amazon’s exponential growth is attributed to their genius marketing techniques, which include three things—selection, convenience, and operational efficiency. In 2005 Amazon’s stock was $34.74. Compare that to its current price $293.64 and you get a glimpse of how well the company has been doing. 

 

Through the years, Amazon has successfully diversified their core business (while sticking to their initial successful approach), from books to other “verticals,” such as electronics, home and garden, etc. This is how Amazon has managed to dominate the CSE market and differentiate themselves from the rest of their competition.

 

With respect to convenience, Amazon has rolled out some great customer loyalty programs, such as free shipping, one-click shopping, and Amazon Prime, which makes shopping at the site extremely efficient and easy.

Finally, with respect to operational efficiency, Amazon has opened warehouses all around the country. Each location is near well-established logistics services, which makes the process very easy and convenient. Their FBA (Fulfilled by Amazon) feature allows merchants to stock their merchandise at these warehouse locations, making shipping to end-users a breeze.

About Wiser

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Wiser’s core product is WisePricer, full-featured dynamic pricing and merchandising engine that monitors, analyzes and reprices retail products in real-time. WisePricer enables retailers to boost profit margins and revenue, price with confidence, and improve merchandising through powering the development of a sound pricing strategy.

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Gil Rozenblatt