- Online retailer is taking share from store with Web sales
- Warehouse network, quick delivery drive jump in spending
Amazon.com Inc. is increasing its share of U.S. online spending during the holiday season, even as Wal-Mart Stores Inc., Target Corp. and other rivals seek to attract consumers with promotional sales and free deliveries.
Amazon took in 39.3 percent of e-commerce spending from Nov. 1 through Dec. 6, up from 37.9 percent during the same period a year earlier, according to Slice Intelligence, which gathers data through e-mail receipts of 3.5 million shoppers. You’d have to combine the Web sales of the next 21 retailers, including Wal-Mart, Target, Best Buy Co., Macy’s Inc. Home Depot Inc., Nordstrom Inc. and Costco Wholesale Corp., to match Amazon’s share, Slice data shows.
Amazon has spent almost two decades and billions of dollars building a network of warehouses and shipping hubs in 69 U.S. cities specifically designed to deliver merchandise to homes and businesses. After getting online shoppers accustomed to two-day deliveries, the Web retailer is pushing to grab a bigger chunk of sales from brick-and-mortar stores. Amazon upped the ante this year by expanding its one-hour Prime Now delivery service to big cities. Total online shopping is on track to climb 11 percent in November and December to $95.5 billion, according to Forrester Research.
"Jeff Bezos was beaten up for a long time about the infrastructure investments he made and the drain on profitability it caused," said Ken Cassar, vice president of analytics solutions at Slice. "He is seeing the payoff on those investments."
Craig Berman, a spokesman for Seattle-based Amazon, declined to comment.
Data from ChannelAdvisor Corp., which helps 2,900 merchants sell goods on various online marketplaces, also indicates that Amazon continues to increase its share of online spending. Merchants using ChannelAdvisor software to sell on Amazon’s marketplace saw sales jump 19.5 percent in the second week of December, faster than the overall e-commerce growth rate of 15 percent.
"Amazon has done well on the basics of selection, convenience, value and trust, and it continues to build on those things," said Scot Wingo, ChannelAdvisor’s chairman. "They invested a lot expanding their Prime Now service around the country, and that’s been a real big win this holiday."