Amazon has a big selection, but does it have the products consumers want?
August 18, 2015 05:17 PM
Amazon.com Inc. endeavors to sell everything from A to Z, but its assortment mix is missing some hot products, according to analytics vendor Ugam.
Ugam studied Amazon’s and other e-retailers’ product assortments in two product categories—women’s running shoes and baseball bats—and found that while Amazon carried the most SKUs in those categories it did not always carry the most sought-after products on the market. Its assortment also included a greater proportion of lower-priced items than specialty competitors.
The study, run using Ugam’s Assortment Intelligence software, found that Amazon carried 729 bats and 723 types of women’s running shoes, where Amazon was the seller of record. The assortment analysis excluded products offered by marketplace merchants. The sellers with the next greatest number of SKUs in those categories—an unidentified baseball specialty e-retailer and a running footwear specialty e-retailer—offered 518 bats and 642 shoes.
At the close of the second quarter, Amazon.com offered approximately 365 million products for sale, according to an analysis from Colin Sebastian, an investment analyst from R.W. Baird. That total is up 63% year over year and up roughly 29% from the close of Q1. The analysis includes products offered for sale by sellers on the Amazon marketplace. Merchants selling on the marketplace accounted for 45% of the units sold in Q2, Amazon says.
But the Ugam analysis of the top 25 “trending” products in the women’s running shoes and baseball bat categories reveal gaps in Amazon’s own inventory. Ugam identified the trending products by studying Google search data, product reviews and a mix of social signals, such as tweets on Twitter and pins on Pinterest. In women’s running shoes, Amazon did not sell 12 of the trending products, and in baseball bats, it did not sell four of them. Much of the gap in women’s running shoes is because Nike Inc. does not let Amazon sell its athletic shoes, and six of the top 25 trending running shoes are Nikes. Any Nike shoes sold on Amazon are sold by marketplace sellers.
A greater proportion of the SKU mix Amazon offers in running shoes and bats are lower priced than specialty e-retailers selling shoes or sporting goods. 70% of the women’s running shoes listed for sale by Amazon were under $100. That’s compared to 62% for the running footwear specialty retailer, 56% for a sports footwear specialty retailer, 55% for a sports retailer and 40% for a footwear specialty retailer. The product mix trended similarly for baseball bats, with the median price of a bat offered on Amazon at $110. The median price at a baseball specialty retailer was $144 and $150 at a sporting goods retailer. The competing specialty retailers focused a greater proportion of their SKU mixes on more costly merchandise. 33% of the sporting goods retailer’s bat stock carry prices of $200 or more, while 30% of the baseball specialty retailer did. 22% of Amazon’s baseball bat SKUs were $200 or more.
Amazon devotes a greater proportion of its product mixes to less popular brands, according to the study. In women’s running shoes, 60% of SKUs carried come from the 10 most popular brands, excluding Nike, and 40% from other brands. Specialty retailers focused more of their assortments on the 10 most popular brands.
On price, Amazon had the lowest price on one of the 13 trending shoes it carried. In bats, Amazon had the lowest price on six of the 21 trending bats it carried and tied another retailer on the price of three others.
Greg Girard, a program director for merchandise strategies at research firm International Data Corp., says studying data is a way for retailers to spot sales opportunities. “Only by collecting the right product intelligence data and analyzing it for opportunities can retailers make fact-based decisions that create a competitive advantage.”
Amazon.com is the leading e-retailer in North America by sales and is No. 1 in the Internet Retailer 2015 Top 500 Guide.