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A Clarion Call To Retailers

As if merchants needed another reminder of Amazon’s growing dominance, a new study suggests that most of its customers are bypassing brick-and-mortar altogether. 4/03/2014 05:00:00 AM

As if merchants needed another reminder of Amazon’s growing dominance, a new study suggests that most of its customers are bypassing brick-and-mortar altogether.

According to Consumer Intelligence Research Partners (CIRP) in Chicago, 80 percent of Amazon shoppers begin and end their buying forays at the No. 1 e-tail site.

“A significant percentage of Amazon buyers don’t shop around at all,” observed CIRP partner and co-founder Josh Lowitz. “They start their shopping at Amazon.com and make their purchase at Amazon.com.”

Of the 20 percent of customers who do start out at a physical store, 5 percent visit Walmart, 4 percent choose Best Buy, 2 percent go to Target and 9 percent shop other stores, the research showed.

And while CIRP found that the incidence of showrooming is actually low, Lowitz said the reason why should worry retailers more than showrooming itself: legions of loyal, committed Amazon customers who are bypassing physical stores.

It’s also proving a challenge for other e-tailers. Only 6 percent of Amazon customers start their Internet shopping at another e-commerce site, led by eBay at 2 percent and Walmart at 1 percent, while the balance begin with searches on Google (12 percent) or  some other search engine (1 percent).

“Amazon buyers start their shopping at Amazon.com almost seven times more often than they start at Google and 15 times more often than they start at another online retailer like eBay or the website of a multichannel retailer like Walmart,” said CIRP partner and co-founder Mike Levin. “It’s not a surprise that customers start shopping where they plan on buying, but online, where there are very low barriers to shopping around, Amazon’s apparent power is significant.”

The CIRP report should serve as a clarion call to retailers of all stripes and distribution channels. Thanks in large measure to Amazon’s ferocious efficiencies, consumers have now come to expect low prices, snappy service, accurate information and minimal hassle.

For better or worse, these are the new opening stakes; ignore them at your peril.

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