An early look at holiday toys’ online winners and losers
November 30, 2015 02:29 PM
For this holiday season, Amazon has a dedicated 2015 Holiday Toy List with just over one thousand products – approximately 0.02% of its Toys & Games assortment of more than 4 million products. (For context, a typical Walmart Supercenter contains about 150,000 products.)
After analyzing these products on Amazon and on other retailers’ websites, we found:
- No retailer matches Amazon’s scope
- Toys “R” Us, where 68% of Amazon’s Holiday Toy List products are sold, comes closest
- Amazon is the price leader on these products (including versus Jet.com and Walmart)
- Mattel & Hasbro comprise ~20% of Amazon’s Holiday Toy List
- Popular products include dolls, Star Wars items, and playsets
- These products have an average of 241 reviews and relatively high star ratings (4.5) on Amazon
No retailer matches Amazon’s scope
Even when Amazon curates its massive assortment to a more manageable list of products for its holiday promotions, other retailers have difficulty matching the breadth of Amazon’s listings.
Selling 68% of Amazon’s Holiday Toy List, Toys “R” Us was the retailer listing the most, followed by Jet.com at 63%. Walmart and Target sold just 59% and 57% of Amazon’s Holiday Toy List, respectively.
Given that other retailers cannot feasibly — and probably should not attempt to — match Amazon’s assortment, it becomes much more important to choose the right products. Analyzing best-sellers for trends, carrying the proper pack sizes and configurations (more important for non-Toys categories), and finding the products with the most unique shopper bases can help retailers compete even with limited assortments.
Amazon offers the lowest prices on its holiday toy List
Given the importance of the holiday season to retailers, Amazon is pricing its holiday toy List aggressively.
We analyzed pricing for 1,129 products from Amazon’s Holiday Toy List across multiple retailers, including Toys “R” Us, Jet.com, Target and Walmart. The chart below shows the average of the item-level price index across retailers. A price index of 100 means that a retailer priced its products, on average, the same as other retailers’ average prices.
Amazon, excluding third-party sellers, is the cheapest on these products, at six percentage points lower than average. At a price index of 96, Walmart is also price competitive here. Target, Jet.com, Toys “R” Us and Amazon’s third-party sellers all are more expensive than average.
This comes just four months after Profitero’s Jet.com vs. Amazon pricing study revealed Jet undercutting Amazon by 8% on average. On these holiday toys, at least, Amazon is not allowing Jet to win on price
Products highly reviewed
Back in October, I wrote how reviews influence each stage of a shopper’s online path-to-purchase by influencing search results, impacting which product pages shoppers visit, and finally impacting purchase decisions (conversion).
On Amazon’s Holiday Toy List, 94% of products had at least one review, with an average of 251 reviews. And 89% had a star rating of at least 4.0 — the threshold number that influences whether a shopper clicks a product. Star ratings of 4.5 are in line with Profitero’s Amazon benchmarks for the Toys & Games category, where best sellers had an average of 992 reviews each and a 4.5 product rating.
Although it’s no surprise that Amazon’s products have more reviews than other online retailers — a significant competitive advantage for Amazon — it is notable that Toys “R” Us is closest with 75% of products reviewed. Target and Walmart have similar, lower shares of these toys products reviewed (62% and 61%, respectively).
Profitero will continue to monitor how inclusion on the Holiday Toy List impacts review counts and star ratings throughout the gifting season.
In short, Amazon has built an enviable holiday toys shop
Amazon’s Holiday Toy List has currently the largest curated assortment, the lowest prices and the most reviews — an enviable position as we enter the gifting season.
Profitero provides retailers and manufacturers competitive intelligence on online pricing, promotions and product assortments.