Study: Digital commerce sites competing and collaborating with Amazon
Having physical stores is often touted as a primary differentiator against Amazon.com. A survey of digital commerce decision-makers, however, identified a number of other ways to compete.
The survey of 500 U.S. and UK senior digital commerce decision-makers from Wunderman Thompson found 61 percent having confidence they can compete directly with Amazon.
Asked which areas “they can win” against Amazon, the top answer was loyalty, cited by 27 percent, followed by customer service, delivery and packaging — all at 24 percent. Other areas where digital commerce leaders felt they can compete against Amazon were innovation, cited by 23 percent; choice of products, 22 percent; sustainability, 21 percent; creating a community, 19 percent; and standing for something (e.g. a purpose), 18 percent.
Yet the study found online players have a conflicted relationship with Amazon.
Thirty-four percent of digital commerce leaders considered Amazon their biggest competitor, 56 percent viewed Amazon as a barrier to their organization’s growth and the same 56 percent said the digital commerce industry would be better without Amazon. Sixty-seven percent said their organization is concerned that consumers want to buy all their products in one place.
At the same time, most found benefits in Amazon as a partner and as digital’s leader:
- Sixty-seven percent agreed they need to work with Amazon if they want to remain competitive;
- Seventy-two percent said they need to invest more money in Amazon because that’s where most products are searched for;
- Seventy-seven percent believe Amazon has been inspirational to their business, and their organization uses its innovations to drive its own strategy;
- Eighty-one percent agreed that Amazon has been good for the digital commerce industry.
Raghbir Rana, senior marketplace consultant at Wunderman Thompson, said in the study, “Amazon should be viewed by brands and organizations as an integral part of a balanced commerce strategy. However, working with Amazon is very different to traditional retailers, so to be successful, organizations need to ensure they plan for this.”
- Ready Or Not? The Digital Commerce Leader – Wunderman Thompson Commerce
- In What Areas Do Digital Commerce Leaders Think They Can Beat Amazon? – MarketingCharts
DISCUSSION QUESTIONS: Which of the areas identified in the Wunderman Thompson survey will best enable online retailers to compete with Amazon? What advice would you have for online players about partnering and competing with Amazon at the same time?