Amazon.com’s “Brand” is Important

Internet Retailer magazine, is reporting that Amazon is one of the most trafficked Internet sites this holiday season. The site is referencing a research study done by Majestic Research holiday shopping survey. Amazon is still proving its power as the gateway to e-Commerce transactions much like Expedia is to online travel, Google is to online search, eBay is to finding value on the web, and Yahoo is to portal like services (personals, email, news, finance, gaming, etc.). Amazon’s huge selection, innovative technology, low prices, free shipping, and easy to navigate website combine to create a brand that has been unappreciated. What I mean is “brands” are huge on the Internet and are often ignored in analysis of barriers to entry. This is one reason why Amazon (and the other names mentioned above) will have staying power over the next 10 years while competition in online retail gets hotter. See the text from the article:

Amazon, Best Buy, Wal-mart, eBay and Target were among the web sites most often visited by consumers during the holiday shopping season, according to Majestic Research Corp.’s Holiday Shopping Survey released yesterday.

More than 50% of the 300 consumers surveyed by Majestic reported visiting Amazon.com, regardless of whether they made a purchase. More than 45% said they had visited eBay, Wal-Mart and Best Buy.

85% of visitors to Amazon and eBay said they went directly to the sites, while 82% of visitors to Victoria’s Secret and Target said they went directly to those sites, according to Majestic.

More than 50% of visitors to eBay and Amazon said they had completed at least one transaction since the beginning of the holiday season, compared to the average 22% among all web sites included, according to the survey. Among those responding to the survey, only 10% of eBay’s and 17% of Amazon’s customers were first-time buyers.

The survey also found that shoppers who were aware of shipping discounts on a site were more likely to make purchases at the site. While 54% of Amazon.com visitors made holiday purchases at the site, 70% of visitors who were aware of shipping discounts completed at least one purchase. At Overstock.com, the proportion of visitors making purchases rose to 41% from 23% among those who were aware of shipping discounts, Majestic said.

Shipping promotions on Amazon.com were the most commonly noticed, with 63% of visitors saying they were aware of shipping promotions on the site. 47% of Overstock visitors indicated they were aware of shipping discounts—which were as low $1—at the site.