Does Amazon Usually Have the Lowest Price Online?

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Among online retailers, Amazon.com consistently offers the lowest prices on products in various key consumer categories, according to a recent report from L2.

The report was based on an analysis of 27,517 Amazon listings of 315 brands in six verticals: beauty, fashion, hair care and color, home care, personal care, and watches and jewelry.

Amazon had the best prices online for 95% of the beauty listings examined, 92% of the fashion listings, 90% of the hair care and color listings, 81% of the personal care listings, and 81% of the watches and jewelry listings.

Amazon also consistently had the lowest prices for popular brands within those categories. For example, 92% percent of L’Oréal products were priced lower on Amazon than on any other online retailer site, and the same was true for 87% of Procter & Gamble listings.

Wal-Mart undercut Amazon’s price more than any other e-commerce site, accounting for 16% of the instances when Amazon had the higher price.

Below, additional key findings from the report.

The Secret to Amazon’s Success

Amazon offers the lowest prices in many of the verticals examined in large part because it encourages competition between third-party merchants on its platform.

The company does this largely by promoting merchants with the best balance of sales performance and low product price in the lucrative “Buy Box” (the product listing with the “add to cart” option).

Across categories, L2 found a direct correlation between the number of merchants competing for this “Buy Box” placement and the average discount available on product listings:

Search Competition

Amazon is now bidding on a significant number of the high-volume searches in the verticals examined. In particular, it is competing heavily in the beauty and personal care categories—bidding on more than two-thirds of common search terms.

About the research: The report was based on an analysis of 27,517 Amazon listings of 315 brands in six verticals: beauty, fashion, hair care and color, home care, personal care, and watches and jewelry.

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